Whenever I have a question, I will normally email the company directly rather than just bla bla bla over the hotcopper...feel that most of the downramper here are just lonely and wanting attention so badly.
Email below is the reply I received from Deanne....everything are just so simply , ask and you shall find out.....
Hi Deanne,
Yesterday news state that "Bubs’ half-year loss blew out by 127 per cent to $8.8 million thanks to increased distribution, employee, marketing and administrative costs. "
Also please read below, just some of the many share holder who has lost faith in Bubs, can you please explain re the Sells Interests in Joint Ventures?
The user below also pointed out this few point:
1) right so most of the growth was from Nulac that they paid through their nose for...
2) they still have a huge earn-out, supposedly for good business performance post acquisition, yet had to write it down within 12 months...
3) gross profit margins from Nulac products is less than 8% hahaha can it get any better?
4) yes it can, they want to sell the JV back to them, at a profit they say. Don't look at the goodwill they say.
5) running out of cash by this year and morgans are angling for the next cap raise in FY20
888 Posts.
32
Date:01/03/19
Time:06:08:26
Post #:37613419 I've been looking at this again. Basically, they gave away 72 ml for no apparent benefit to the business. Where are the new staff we were meant to get in the last quarter? I no longer have any faith in our board and have sold out at a major hit to my investment funds. I may re-enter at some point but there will have to be a shake-up of our upper-level management. Good luck to those who still hold the faith.
500 Posts.
39
Date:01/03/19
Time:10:11:59
Post #:37616317
1) right so most of the growth was from Nulac that they paid through their nose for...
2) they still have a huge earn-out, supposedly for good business performance post acquisition, yet had to write it down within 12 months...
3) gross profit margins from Nulac products is less than 8% hahaha can it get any better?
4) yes it can, they want to sell the JV back to them, at a profit they say. Don't look at the goodwill they say.
5) running out of cash by this year and morgans are angling for the next cap raise in FY20
------------------------------------------------- Reply I received --------------------------------------------------------------
Dear Sam,
Apologies for the delay in responding to your email, however please find below some information in regard to your inquiry.
As you can see in the slide below from the Half Year Results presentation most of the sales growth was from Bubs product.
“Growth predominantly driven by sales of Bubs® products: +155% (3x) pcp, and +109% on 2H18.”
Gross profit from Nulac products for 1H FY19 is actually 10%. Please note the GP calculation excludes inventories write downs.
As Bubs have signed an agreement with Tatura for production of infant nutritionals the Uphamgo facility is no longer core to operations.
Therefore, Bubs Australia’s 49.9% interest in the Uphamgo dairy manufacturing joint venture, 49.9% interest in the Cambria Management Company Pty Ltd and Cambria Unit Trust and 49.9% interest in New Zealand Nutritional Goat Company Limited will
be sold back to the NuLac vendors for $3,493,000.
The sale generates a considerable saving in overheads previously required to maintain facility operations. Employee costs included approximately $500k for head office staff at Uphamgo.
The Uphamgo transaction does not affect the exclusive milk supply from the NuLac vendors’ goat herds, nor the ownership of the CapriLac®, Coach House Dairy®, and other brands acquired in December 2017.
During 1H team capabilities were strengthened with new appointments in Operations, Marketing, Supply Chain, Technical QA, Export Sales
and China market management.
The overall statutory net loss of $8.8 million, incorporates expenses incurred outside of the normal operations of the company, including $4.5 million expense relating to the fair value movement of contingent consideration of $13.4 million payable to the Nulac Foods vendors for future satisfaction of certain performance targets, $288K share based payments relating to options issued in FY18, and $241K inventories written off relating to discontinued products.
The operating loss reflects the fact the business is still in a strong growth phase including the high costs of new product development, expenses related to expanding the domestic and China sales channels and investing in systems and processes to improve the efficiency of the operations.
Cost of goods includes inventory build. Inventories on hand at 31 December 2018 was $12,470,685 (30 June 2018: $6,018,518) which is in line with Group’s inventory holding requirements, to service delivery commitments.
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(20min delay)
