Slide 1: FY18 Annual Results Presentation
FYI8 ANNUAL RESULTS PRESENTATION 28.09.2018
Slide 2: Inspiring new generations of happy, healthy bubs
Inspiring new generations of happy, healthy bubs.
Slide 3: Bubs provides quality nutrition for every stage of a child's development
BUBS® PROVIDES QUALITY NUTRITION FOR EVERY STAGE OF A CHILD'S DEVELOPMENT Our portfolio currently caters for the first NEWBORN TODDLER PREGNANCY days of life
Slide 4: A period of transition
A PERIOD OF TRANSITION BUILDING STRONG FOUNDATIONS FY18 | pray 10 SCALE git + Strengthening domestic foothold. + Transformative acquisition of vertically integrated supply chain assets. + Establishing strategic partnerships in China to drive sales and distribution. POISED FOR STRATEGIC AND uy FY19 S
Slide 5: Financial Overview
FINANCIAL OVERVIEW ——= _-
Slide 6: Financial Overview
FINANCIAL OVERVIEW The financial results reflect the significant and essential investment made into vertically integrating our supply chain and production capabilities, whilst building a platform to scale through product and market development. FY18 GROSS SALES $18.4M NET REVENUE $16.91M GROSS PROFI
Slide 7: Performance Update
PERFORMANCE UPDATE FY18 gross sales triple to $18.42M with 330% net revenue growth YOY. A significant portion of planned future growth is expected to come from China direct sales (CBEC & MBS). FY18 GROSS SALES REVENUE BY REGION $16M $14M $12M $10M $8M $6M $4M $2M 1H FY17 2H FY17 1H FY18 2H FY18 Aust
Slide 8: Gross Sales Revenue by Product Group
GROSS SALES REVENUE BY PRODUCT GROUP Infant Formula jm Baby Food m Milk Powder lm Fresh Dairy Other PRODUCT MIX Group product mix spread across dairy segmentation: Nutritionals, Chilled and Powder. KEY DRIVERS ° >) >) ° @ Infant Formula revenue accounts for 30% of total gross revenue in FY18. Infant
Slide 9: CEO message
The past year has been one of many milestone achievements as we continue to build a strong foundation, enabling scale. We now shift our focus to accelerating the growth of our infant nutrition products in China. This optimisation of our product and market mix will improve margins and drive profitabi
Slide 10: Strategic Priorities
STRATEGIC PRIORITIES
Slide 11: Continued Momentum
CONTINUED MOMENTUM (ASX: BUB) Bubs Bubs Bubs launches Refreshed Bubs Dennis Lin Australia launches in onRED.com new “SMILE” launches on appointed as commences Chemist inChina packaging vip.com in Chairman trading on Warehouse design China ASK FEB MAR JUL 2017 2017 2017 (@> (@) © O © JAN FEB MAY JUL
Slide 12: Continued Momentum
CONTINUED MOMENTUM (ASX: BUB) Bubs Founder Bubs Acquisition of Bubs signs $17M deal Bubs launches on Nulac Foods & agreement with Times. Capital and Managing Kidswant.com Exclusive Milk with New Asia for Raising Director in China Supply JD.comin China's $40 million appointed ocT Agreement FEB China
Slide 13: Strategic Priorities
STRATEGIC PRIORITIES INCREASED INNOVATION Ee MARKET Awe PENETRATION DEVELOPMENT KEY PILLARS CRITICAL TO DELIVERING THE FUTURE 5: Ne Asian cocus GROWTH OF THE BUSINESS: AWARENESS AND IMPACT EEE Eee + Bubs Organic® + Coles + eCommerce + Brand design re-launch Cereals + Woolworths partnerships + B2C we
Slide 14: Supply Chain Integration
(@b) SUPPLY CHAIN INTEGRATION
Slide 15: Goat milk nutrition and digestion
=a Bete cont MMM eR ITION “~ Digestion is a key criteria for parents when choosing which infant formula to feed their child. The unique protein and fat structure in goat's milk makes it easier for the body to break down and can be absorbed more gently. Goat milk formula is particularly suitable for
Slide 16: Chinese Demand for Goat Milk Formula
CHINESE DEMAND FOR GOAT MILK FORMULA AI Goat milk formula is experiencing rapid growth in China. MARKET SIZE (RETAIL VALUE) | BN RMB CATEGORY POTENTIAL [CAGR +28% > a © Goat milk based formula is experiencing 1 5,5 rapid growth, now accounting for 5-10% share of total category 11,6 © Category leader
Slide 17: Australia's goat dairy leader
AUSTRALIA'S In December 2017, Bubs Australia acquired 100% of Nulac Foods, transforming the Company into a clear leader in the goat dairy landscape, supplying >60% of Australia’s total goat milk production Guarantees ongoing exclusive access to locally sourced quality fresh goat milk at a fixed pric
Slide 18: Vertical Integration
VERTICAL INTEGRATION Supply chain integration and strategic manufacturing partnerships provide Bubs® with a unique positioning, offering consumers and retailers product integrity, traceability, scalability and provenance. ()-0-(7 )-0-(at)-0-(&)--0-( 6 ) FARM GATE MILK PROCESSING NUTRITIONALS CANNING
Slide 19: Specialty Dairy Portfolio
SPECIALTY DAIRY PORTFOLIO DIVERSIFICATION DELIVERS INCREMENTAL REVENUES AND BALANCES MILK ALLOCATION Our specialty dairy portfolio includes CapriLac® yoghurt, fresh and powder goat milk products, as well as Coach House Dairy® award-winning flavoured Jersey milk. Provides a margin accretive channel t
Slide 20: For personal use only
For personal use only
Slide 21: China Routes to Market
CHINA ROUTES TO MARKET ~ Multi-channel strategy to stimulate demand outbound from Australia and in-market in China. PUSH FROM AUSTRALIA op ° \ e S \} PULL FROM CHINA iy / ’ Mother B2C Cross-border, and Baby eCommerce stores and 020 Australian shelf (CAC - presence in major Daigou supermarkets and KO
Slide 22: Strong Domestic Performance
Be 3 Retail Pharmacy STRONG DOMESTIC PERFORMANCE 2,500 Australian retail touchpoints Bubs® was founded in Sydney in 2006 and upholds an established premium positioning in the domestic infant nutrition category with a loyal and growing consumer base. The Company maintains that a strong brand presence
Slide 23: C2C eCommerce Daigou Engagement
23 C2C eCOMMERCE DAIGOU ENGAGEMENT The Company has commenced actively engaging the Australian Daigou community, by sponsoring industry events and Key Opinion Leaders (KOL's). This activity promotes the syndication of Bubs® digital content and product reviews, resulting in increased brand awareness a
Slide 24: B2C eCommerce
m= B2C eCOMMERCE 0) STRATEGIC ALLIANCES WITH ALL MAJOR eCOMMERCE PLATFORMS Throughout the year, significant progress was made in the cross-border eCommerce channel via a strategic partnership with Times New Asia, securing a minimum sales volume _ commitment of $17 million in Y1, $24 million in Y2 an
Slide 25: Mother & Baby Stores
25 MOTHER & BABY STORES BUBS ORGANIC® BABY FOOD LAUNCHES IN MOTHER & BABY STORES Following successful import registration, Bubs Organic® baby food products have launched into the first Mother and Baby stores in China via a new partnership with QianJiaWanPu, the largest distributor of infant formula
Slide 26: Regulation Progress
26 REGULATION PROGRESS WELL PROGRESSED WITH SAMR APPLICATION In June 2018, Bubs Australia entered into a long-term Agreement with Australia Deloraine Dairy, one of the 15 infant formula manufacturing facilities in Australia licensed to produce infant formula for export to China. (>) Bubs® was nomina
Slide 27: Outlook
OUTLOOK AS . y sey” = ' Aad Bia iA
Slide 28: FY19 Strategic Growth Plans
FY19 STRATEGIC GROWTH PLANS With solid foundations in place, the Company is poised for sustainable growth: VERTICA INTEGRAT ION & SUPPLY CHAIN + Increase the milk pool to ensure supply meets forecasted growth demand, + Explore opportunities to further enhance the vertical integration of business ope
Slide 29: Disclaimer
29 DISCLAIMER This presentation and any materials provided (materials) have been prepared by Bubs Australia Limited (Bubs) and contains general information about Bubs activities. By accepting the Materials you agree to be bound by the below terms and conditions. Terms and Conditions ft This presenta
Slide 30: For personal use only
For personal use only