Wellnex Life on track to meet guidance as sales continue to growBy
Danica Cullinane-
April 12, 2023
Wellnex Life expects to hit its $29 million revenue target as its brand offering expands.
Consumer healthcare business
Wellnex Life (ASX: WNX) has announced it is on track to meet its guidance of $29 million for the 2023 financial year, up 55% on the previous year.
This growth has primarily been the result of growth in both the company’s brand offering and its intellectual property (IP) licensing.
Over the last 18 months, Wellnex has launched or acquired five new brands and secured IP licensing agreements with some large domestic and international pharmaceutical companies that are expected to accelerate revenue and margins even further in the next financial year.
““Wellnex over the last 18 months has been laying the foundations to be a significant player in the healthcare market and that work is starting to pay dividends,” Wellnex chief executive officer George Karafotias said.
“We will continue to see new products coming to market throughout 2023 that will further strengthen the financial performance of the company,” he added.
Higher guidance budgeted for FY24Wellnex today also confirmed its guidance for the 2024 financial year as $47.2 million, which is 63% higher than its FY23 guidance.
This would coincide with an increase of gross margins as the company’s wholly-owned brands increase as a portion of total revenue.
Wholly-owned brands currently account for 15% of FY23 revenue although this is budgeted to increase to 27% for FY24. Meanwhile, the lowest margin segment, being distribution arrangements, is expected to reduce from 52% of total revenue to 5% in FY24.
In addition to brand recognition and increased distribution channels, Wellnex said continued growth would come from extending the brands with new product being brought to market throughout 2023.
Joint venture brands with Chemist Warehouse and OneLife Botanicals are budgeted to increase from 4% this year to 21% of FY24 revenue, providing a healthy margin for Wellnex.
Profits from IP licensing arrangements also go straight to the bottom line as there are minimal costs in facilitating these relationships, Wellnex said.
New brands launchedWellnex launched three brands in the first half of FY23:
Pharmacy Own medicines (offering consumers competitively-priced equivalent products to major brands), Mr. Bright premium teeth whitening products, and The Set.Co skincare range.
For this second half of FY23, the company and its joint venture partner Chemist Warehouse is planning the launch of medicinal cannabis products for the Special Access Scheme Category B (SAS-B) market.
(20min delay)