Founder and CEO of Bubs Australia Kristy Carr has been ousted by the company’s board, with its statement to the ASX saying her termination was effective immediately due to “failure to comply with reasonable board directions”.
Former executive chair Dennis Lin's employment was also terminated, effective immediately.
Carr founded the brand in 2005 to become a leading organic goat milk infant milk formula and other infant food products brand on the market. She has led the company through growth from its first product to listing on the ASX, accessing the Chinese market despite the tightening of rules around IMF imports, two capital raises, and its hugely successful Operation Fly Formula into the US market last year. In November, it was awarded Australian Exporter of the Year at the annual Australian Export Awards. In FY22, it recorded its first profit.
On 11 April, Katrina Rathie was elected chair, replacing Lin. Reg Weine was appointed as an independent non-executive director and Paul Jenson had joined the board weeks earlier.
Lin’s removal was attributed to the 1H FY23 poor performance of the company, with gross revenue down 10 per cent on the prior corresponding period. Strong growth in Australia and the US (gross revenue up 116 per cent in the quarter for the US) was offset by poor sales in China and other overseas markets. Meanwhile, group branded gross revenue was up 26 per cent on pcp and group infant formula gross revenue rose 46 per cent, with the two segments accounting for 72 per cent of the group's quarterly gross revenue.
The board said it was time for a change in leadership and to also ensure the governance framework of the company aligned with ASX Corporate Governance Principles.
The company started a strategic review of the business in late April, focusing on expenditure management in the Chinese market. The review is due to be completed by 30 June 2023.
Rathie said the board "acknowledge Kristy's long service to Bubs and the role she has played in building the Bubs brand to the position it enjoys today".
Richard Paine will act as interim CEO.
