While consumption is getting weaker, there is an area which is...

While consumption is getting weaker, there is an area which is still doing quite well : healthcare supplement and vitamins.
I am quite surprised that this area is not mentioned much, but it is probably due to the fact that most of the listed companies are microcaps : Biome (BIO), EZZ Life Sciences (EZZ) and Vita Life Science (VLS).

Most recent update by company :
- Biome : sales doubled during FY 23. The company expects another 50 % increase in FY 24.
The company has also indicated that they just had two consecutive quarters of positive EBITDA and cash flow from operation;

- EZZ Life Sciences : Q3 receipts from customers increased by 111 % yoy (some one offs due to delayed payments).
This week, their chairman said that their (net) cash increased to around 19 m$ at the end of June vs 14.5 m$ at the end of March, which seems to indicate a strong cash flow for Q4 (confirming the good cash flow in Q3, after a negative cash flow from operation during H1 24);

- Vita Life Science : the company increased its sales and EBIT by 10 %+ during FY 23 (ending in December 23).
The company just gave a guidance for H1 24, expecting another 10 %+ increase for revenues and a weaker growth for its pre-tax profit for H1 24 (ending in June 24).

Based on elements I have found, all the growth of these companies is only organic.
The profile of the 3 companies is a bit different :
- Vita Life Science is a rather mature company, with a good level of margin (EBIT margin of 16 %),
- while Biome and EZZ are new companies, which are in a high growth phase.
Their main brand was launched respectively in 2019 and 2020.

So far Biome was selling almost exclusively in Australia, but it is now expanding rapidly in new geographic areas.
Vita has still a strong presence in South East Asia (its origin) with 59 % of its sales in Australia (including exports to China).
EZZ sales are mainly from China, but the company is now expanding fast in other geographic areas (rest of Asia and North America).

This industry looks worth studying into more details given its growth, the good margins that can achieved at maturity and a rather low Capex requirement.
Looking at their low number of employees, Biome and EZZ have an asset light business model.

As microcaps, these stocks can also be quite volatile and some have a limited liquidity.