Q2 2024 Biogaia AB Earnings Call Transcript
Key Points
- BioGaia AB (BGLAF) reported a 22% increase in sales for Q2, driven by strong growth in Asia-Pacific and the Americas.
- The company's EBIT grew by 42%, with an EBIT margin of 35%, indicating improved profitability.
- BioGaia AB (BGLAF) successfully launched direct business operations in Australia and New Zealand, expanding its market presence.
- The company won an arbitration with its former Italian distributor and signed a long-term contract with Recordati, enhancing its distribution network in Italy, Spain, and Portugal.
- BioGaia AB (BGLAF) is making strategic investments in marketing, sales, and R&D to drive future growth, including a global advertising campaign and new product development.
- Adult sales decreased by 6% in Q2, primarily due to lower sales of Protectis tablets in South Africa, Belgium, and Japan.
- Operating expenses increased by 13%, driven by higher sales and marketing costs and investments in subsidiaries.
- The gross margin for adult health products decreased from 67% to 61%, mainly due to a mix effect with lower-margin products.
- The company is projecting additional costs of SEK75 million to SEK85 million in the second half of the year, which may impact short-term profitability.
- BioGaia AB (BGLAF) does not provide specific guidance on future sales growth, creating uncertainty about the immediate impact of its investments.
Hi, this is Theresa Agnew, CEO of Biogaia, and Alex and I are here to share our Q2 results. For Q2, our sales were SEK384 million, which is growth of 22%. That was mainly driven by growth in Asia-Pacific as well as our Americas region.
Sales in Europe, Middle East, Africa increased by 7%, Asia-Pacific by 49%, and Americas by 22%. And we did have some orders due to quarterly variations in some of those areas, specifically in China and Brazil. Our EBIT was SEK134 million, which is growth of 42%, and our EBIT margin is 35%. Earlier in the month of June, we actually announced that we are taking our business direct in Australia and New Zealand. This is really exciting for us. It is one of our future investments.
Australia is actually the 12 probiotics market in the world, and we have a really big opportunity to grow in both Australia and New Zealand. Those are both markets where consumers understand probiotics. And coming in with our products, our probiotics drops in the beginning, and then we will be expanding our other
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