Conference call will be held on Friday, March 31 at 10 AM ET
VANCOUVER, BC, March 31, 2023 – ELSE NUTRITION HOLDINGS INC (BABY) (BABYF) (0YL.F) (“Else” or the “Company”) the Plant-Based baby, toddler, and children nutrition company, today reported fourth quarter and fiscal year 2022 financial results for the period ending December 31, 2022. The financial statements and MD&A are available on SEDAR under the Company’s profile.
Fourth Quarter and Fiscal Year 2022 Financial Highlights
Recent Business Highlights
Management Commentary
Hamutal Yitzhak, CEO of Else Nutrition, commented, “We are very pleased with the significant progress we made in 2022, as we continue our journey to become a global leader in the plant-based nutrition arena. We are becoming a recognized national brand in the US, carried by major grocery and drug retailers. We ended 2022 with Else products listed in over 11,000 store locations, an incredible growth from roughly 1,200 stores at the end of 2021. Our customers now include prominent retailers such as CVS and Walmart, as well as leading e-commerce sites such as Amazon, Walmart.com, Tmall, and JD. We expect to reach 20,000 retail locations in 2023. We also expanded our geographic reach during 2022, as we entered the Canadian and Chinese markets. Furthermore, we widened our product assortment, from a single SKU to more than 15, adding Nutritional Kids Shakes, Baby Super Cereals, and Toddler Omega. We expect to double our SKU count in 2023 which should further accelerate our growth.
We are pleased to announce that the product shortages which limited our ability to supply our customers, thus hampering our sales growth in recent months, are essentially behind us. We worked diligently to secure two additional manufacturing facilities in the US and Europe and have been manufacturing at our new US facility for weeks. The two new facilities have more than tripled our current production capacity, mitigating the risk of future out-of-stock situations. We estimate the revenue impact due to the product shortage to be roughly $1.5M during the second half of 2022, roughly over 15% of our annual sales.
As we look out into 2023, we remain focused on our growth objectives. We continue to be enthusiastic about our international expansion. Growing our sales in China will be a priority in 2023, following our successful launches on Tmall Global and JD.com. China is the world’s largest infant formula market, valued at roughly $33 billion and expected to grow to $40 billion by 2025. Our entry into Canada in August had a much greater than-anticipated start, and the outsized demand has continued. We expect to roughly double our store base in Canada in 2023. Furthermore, we are excited to enter the UK and Australia in the second half of 2023, as demand for an alternative to dairy and soy formula continues to increase in those regions.
In 2023 we will begin our infant growth clinical study for the FDA and European permits, with expected conclusion in 2024. Receiving FDA approval is a very high priority for Else Nutrition, as we believe that becoming the first non-dairy and non-soy FDA-approved infant formula will be transformational for the valuation of the Company.
FDA Update
As part of the pathway to bring its Infant formulation to market under FDA and other authorities approvals, Else concluded two successful preclinical safety studies during 2021 and 2022 on its plant-based infant formula, to demonstrate safety and nutrient bioavailability of the infant formula and its ingredients. The results demonstrated proper growth, similar to dairy-based infant formula, in a neonatal preclinical model, as well as the infant formula protein efficiency and quality. Those are the key two steps out of three, on the path to obtaining the FDA and other regulatory permits to bring the product to market.
In February 2023, the Company announced that the Institutional Review Board (the ethical committee) approved the infant growth study protocol for the testing of the Else Infant Formula.
As a final step before initiating the study, the Company has now submitted the infant growth study protocol to the FDA for review and is awaiting the FDA response, as well as a comparator formula availability, currently unavailable due to the continuous infant formula shortage followed by several recent product recalls in the US. In 2023, a second clinical growth study on the healthy toddler population has started as part of the company’s plans to continue research activity demonstrating the safety, tolerability, and efficacy of its product range.
Conference Call
Hamutal Yitzhak, CEO and Co-Founder, will hold a conference call to discuss the quarter’s financial results at 10:00 a.m. (Eastern Time) on March 31, 2023.
Interested parties can listen via a live webcast, from the link available in the Investors section of the Company’s website or at https://app.webinar.net/MDxXRYw6vqg.
A replay will be available after the call, in the Investors section of the Company’s website at https://app.webinar.net/MDxXRYw6vqg.
About Else Nutrition Holdings Inc.
Else Nutrition Holdings Inc. is a food and nutrition company in the international expansion stage focused on developing innovative, clean, and plant-based food and nutrition products for infants, toddlers, children, and adults. Its revolutionary, plant-based, non-soy formula is a clean-ingredient alternative to dairy-based formula. Else Nutrition (formerly INDI) won the “2017 Best Health and Diet Solutions” award at Milan’s Global Food Innovation Summit. The holding company, Else Nutrition Holdings Inc., is a publicly-traded company, listed on TSX Venture Exchange under the trading symbol BABY and is quoted on the US OTC Markets Q.X. board under the trading symbol BABYF and the Frankfurt Exchange under the symbol 0YL. Since launching its Plant-Based Complete Nutrition for Toddlers, made of whole foods, almonds, buckwheat, and tapioca, the brand has received thousands of powerful testimonials and reviews from parents and gained national retailer support from Sprouts Farmers Market, and achieved rapid sales growth. Else became the #1 Best Seller on Amazon in the Fall of 2020 in the New Baby & Toddler Formula Category. It recently won the ‘Best Dairy Alternative’ Award 2021 at World Plant-Based Expo and was a Nexty Award Finalist at Expo West 2022 in the Plant-Based lifestyle category.
Investor Relations Contact:
Lytham Partners, LLC
Mr. Ben Shamsian
New York | Phoenix
E: shamsian@lythampartners.com
P: 646-829-9701
RBMG – RB Milestone Group LLC
Trevor Brucato, Managing Director
E: Baby@rbmilestone.com
www.rbmilestone.com
Toronto Stock Exchange
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Caution Regarding Forward-Looking Statements
This press release contains statements that may constitute “forward-looking statements” within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as “will” or similar expressions. Forward-looking statements in this press release include statements with respect to the anticipated dates for filing the Company’s financial disclosure documents. Such forward-looking statements reflect current estimates, beliefs and assumptions, which are based on management’s perception of current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. No assurance can be given that the foregoing will prove to be correct. Forward-looking statements made in this press release assume, among others, the expectation that there will be no interruptions or supply chain failures as a result of COVID 19 and that the manufacturing, broker and supply logistic agreement with the Company do not terminate. Actual results may differ from the estimates, beliefs and assumptions expressed or implied in the forward-looking statements. Readers are cautioned not to place undue reliance on any forward-looking statements, which reflect management’s expectations only as of the date of this press release. The Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.