EZZ Life Science’s (ASX: EZZ) fourth quarter results (Q4 FY2022) have been highlighted by a rise in sales, with receipts from customers increasing 16% to $4.6 million compared to the previous quarter.
The genomic life science company aims to improve the quality of life and human health through developing and selling products backed by genomic research and development.
EZZ’s products address four key human health challenges: genetic longevity, human papillomavirus (HPV), helicobacter pylori, and weight management.
The company, which was founded in 2019, remains focused on investing in the future of consumer health through promoting its products and distributing them through e-commerce platforms across Australia, New Zealand, China – expanding worldwide.
In Q4 FY2022, the New South Wales-based company launched a cross-border e-commerce store on Douyin, mainland China’s version of TikTok. This was a large contributor to the rise in receipts from customers during the period – having generated sales of $85,000 within the first 22 days.
The company’s operating cash inflow remained positive during the quarter.
As for the company’s cash position, it remained robust with a balance of over $10 million at 30 June 2022, which included a slight increase of $90,000 in the bank.
China’s 618 shopping festival
During Q4 FY2022, China’s 618 shopping festival was another opportunity to increase revenue from customers and recoup some sales lost to COVID-19.
EZZ’s sales from the festival passed $650,000, with the highlight product being its bone growth capsule. The bone growth capsules were ranked the number one product in its category of children’s nutritional supplements on Tmall Global for sales, generating a total revenue of 1.7 million CNY (A$364,000).
The company has exclusive wholesale distribution rights for the EAORON brand of skin care products to pharmacies, supermarkets and specialist retailers across Australia and New Zealand, as well as its own products which launched in 2020 under the EZZ brand.
The EZZ branded products, of which there are 17, are distributed to retailers and customers across Australia, New Zealand, and China, with plans to expand to other international markets in the near future.
Global skin care market
The global skincare market has expanded at a compound annual growth rate (CAGR) of 5% over the last five years to sit at a valuation of more than US$145 billion in 2021, according to industry reports.
Facial care accounts for more than 75% of the market, with body care and skin care kits contributing 14% and 6% respectively.
Experts forecast the global skin care market will continue to grow at a CAGR of 5% over the next five years to over US$192.7 billion by 2027.
The skin care market is dominated by the Asia Pacific, which accounts for more than 35% of the global market, through platforms such as Tmall and Douyin.
Australia’s skin care market experienced a CAGR rate of 4% over five years to US$3.7 billion in 2020.
Through a distribution agreement, EZZ has secured a slice of the Australian market by imports and distributing EAORON skin care products to pharmacies, supermarkets and specialist retailers across Australia and New Zealand.
Global health and wellness supplements market
The global health supplements market has risen at a CAGR of 6% over five years to be valued at more than US$358 billion in 2021.
Vitamin and dietary supplements accounted for more than 50% of the global market.
It’s expected to grow at a CAGR of 6.3% over the next eight years estimated to be worth US$620 billion by 2030.
Like the skincare market, the Asia Pacific region holds the largest market share, with around 35% of the total revenue.
EZZ has been expanding its footprint in this market since 2020. The company has been formulating, producing, marketing and distributing its own EZZ brand health supplement products, with a focus on ones with significant consumer demand including probiotics, immunity and energy tablets, hair growth spray and iron/coffee jelly.
Also during Q4 FY2022, EZZ released four new products, including a hair scalp scrub, anti-frizz hair spray, hair growth spray, and hair mask.
The products contain local and natural ingredients, with some organic elements.
EZZ has ambitious plans to expand and capitalise on the growing demand for skin care and various health products.
The company hopes to expand its distribution points overtime, both at the point of sale and the existing channels – adding to its collection of global stores, similar to its one launched on Douyin in Q4 FY2022.
EAORON is considered to be an integral part of the company’s operations, with plans for more pharmacy chains, supermarkets, and e-commerce channels in Australia and New Zealand anticipated for the future.
As well as continuing to distribute and endorse EAORON products, EZZ will continue working on its own products, continuing to keep up and compete with rivals.
EZZ aims to transition its manufacturing process in-house for the benefits of higher adaptability, enhanced quality assurance and improved cost efficiencies.
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