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Cellmid sees growth in revenue from new distribution channels

The financial impact of the new distribution channels has started to show in the USA and in Australia, where sales were up 74% and 24% respectively.

Cellmid Limited - Cellmid sees growth in revenue from new distribution channels
Gross profit margins in 1H FY2020 were at 73% on a group level

Cellmid Limited (ASX:CDY) has achieved an improvement in operating performance in 1H FY2020 with total revenue up 5.5% on pcp (previous corresponding period) and the loss down 60% to $1.4 million.

There was an increased investment in new distribution channels, reflected in the selling and distribution expenses, that were 28% up on pcp to $1 million in 1H FY2020.

Inventory holdings increased 46% in 1H FY2020 on pcp to $2.4 million in preparation for scaling into the existing and newly established channels.

Sales growth in US and Australia

In total, Cellmid established and expanded 18 new distribution channels in 1H FY2020 including Priceline and openshop in Australia, Douglas Perfumeries and QVC Germany in Europe, Beauty Collection and Rymax in the US, as well as export sales into Korea, Singapore, Cambodia and China.

In addition, Cellmid has invested heavily in ecommerce capabilities across Australia and the USA.

The financial impact of these new distribution channels has started to show in the USA and in Australia, where sales were up 74% and 24% respectively on pcp.

This is expected to accelerate in 2H FY2020 and in the following years.

Diversified revenue base

In 1H FY2020, Cellmid successfully diversified its revenue base with 28% of all consumer sales in markets outside of Japan, up from 21% in 1H FY2019.

Cellmid CEO Maria Halasz said: “We are very proud of the enormous progress we have made over the past year in implementing our strategic growth plan.

“Our new senior management team has worked hard to expand our global footprint, diversify our revenue and expand our e-commerce and we are well positioned to accelerate revenue growth through these new distribution channels in the months and years ahead.”

Quick facts: Cellmid Limited

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ASX:CDY
Market: ASX
Market Cap: $12.15 m
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