BWX, the company behind natural skincare brand Sukin, has announced the completion of a A$40 million placement on Friday morning, as part of a $50 million equity raising to build a manufacturing facility in Victoria.
The company will raise the additional $10 million through a share purchase plan.
“We are very pleased with the strong support from our institutional shareholders who are right behind our plans to transform BWX’s operating model with the development of a new world-class manufacturing facility, BWX chief executive officer David Fenlon said on Friday.
BWX said that $33.7 million of the equity raising would go towards building the manufacturing facility and support office. Three sites in Victoria are currently under consideration.
The site will have four highly automated, high-speed production lines, enabling the company to triple its manufacturing capacity. It is expected to be completed by December 2021.
“Importantly, this initiative supports local manufacturing and Australian jobs at a time when the retail landscape is being heavily disrupted, and as more companies look to future-proof their business models,” BWX chief operations officer Rory Gration said.
The announcement comes as the company reported strong earnings growth in its unaudited full-year results.
In the 12 months to June 30, revenue was up 25 per cent to $187.6 million, and earnings, before interest and tax, were up 30 per cent to $27.5 million, boosted by strong online sales in the second half.
Net profit after tax jumped 48 per cent to $14.1 million, as the company pivoted to produce hygiene products, in high demand due to the pandemic. All core brands performed well and continued to gain market share.
“Following a strong FY20 trading performance, we are committed to using the Placement proceeds to invest in the new facility which we expect can solve capacity constraints, unlock significant efficiency gains, and deliver growth over and above our Three Year Strategic Plan,” Fenlon said.
Inside FMCG chats to David Fenlon about Covid challenges and much more in the latest issue of Inside FMCG magazine.
