Bubs Australia’s 1H24 results showed a dramatic drop in net loss, with rapid growth in the US and pleasing growth in the Australian market playing a major part. The company also announced Federal Court proceedings brought by founder and former CEO, Kristy Carr, and former executive chair, Dennis Linn, had been mutually discontinued.
Bubs reported a net loss before tax of $7.7 million compared to 1H23’s level of $44.4 million. Revenue was $39.4 million, up 25 per cent on the prior corresponding period (pcp).
Snapshot
- Group revenue $39.4m, up 25% pcp;
- Australia net revenue: $11.7m, up 36.8% pcp;
- US net revenue $18.2m, up 84.6% pcp;
- China net revenue $7.1m, down 30.3% pcp:
- US now accounts for 53% of group gross revenue;
- holds 52% of Australian goat infant milk formula market; and
- accounts for 5.3% of total Australian IMF market.
CEO Reg Weine said improvement in its underlying gross margin (38 per cent versus 35 per cent 1H23) was driven by several factors - strong sales volume of higher value goat products, improved inventory management, and geographic and channel optimisation.
Operating expenses reduced to 53 per cent from 78 per cent pcp through effective cost discipline and providing a pathway to profitability in FY25, Weine said.
“Momentum in our business continues to build and H1 was a very strong six months with gross revenue up 29.8 per cent on the prior corresponding period driven by our rapid growth in the US,” he said.
The US market remains the focus and as a result its Deloraine manufacturing plant is now running a second production shift and has doubled daily production volumes.
In China, the inventory overhang from the company’s previous exclusive distributor will be cleared by the end of FY24.
