Bubs delivered its first half-year net profit of $3.6 million for the period ending December 31 last year, a jump from the $7.7 million loss during the same period a year ago.
CEO and MD Reg Weine said the results are a testament to the company’s sustained execution of its strategies.
“I am pleased to confirm that our focus on working capital, continued cost-out initiatives and reduction in one-off expenses has enabled Bubs to achieve its strongest half-yearly cash flow,” he continued.
The company achieved a positive operating cash flow of $3.9 million in the second quarter of this year, supported by cost-cutting, pack-size changes, and SKU rationalisation.
“Since 2023, we have eliminated 20 per cent of our SKU count, allowing us to focus on our higher-margin products,” Weine said.
Bubs’ revenue rose 23 per cent to $48.5 million, driven by strong growth in international markets.
In the US, sales increased by 28 per cent to $23.2 million, contributing 48 per cent of total profits.
Sales in China grew by 45 per cent to $10.2 million, driven by growth in cross-border e-commerce and the expanding Online to Offline (O2O) Mother & Baby store channel. Bubs’ products are now available in more than 1050 O2O stores.
In other international markets, revenue grew by 85 per cent to $4.6 million, led by demand in Japan and Vietnam.
Bubs reported a gross margin of 50 per cent, up from 49 per cent last year, reflecting better inventory management and cost efficiencies.
Looking ahead, the company expects continued growth in the US and forecasts gross profit for this year to be approximately 45 per cent, up from its earlier estimate of 40 per cent.
“We are very pleased with our results and remain cautiously optimistic about our full-year outlook,” Weine concluded.
