Blackmores announces strong first quarter of sustained sales growth
Blackmores Limited (ASX: BKL) today announced a 17% increase in first quarter Group revenue,
compared to the previous corresponding period, to $54.7 million.
Sales in Australia increased by 14% to $44.9 million, compared to the previous corresponding period.
The natural health company’s stronger than expected results were further supported by record sales
growth in Asia, up 37% to $8.8 million - boosted by concerns about H1N1 which resulted in consumer
demand for immunity products in the early part of the quarter.
Movements in exchange rates and costs of raw materials impacted EBITDA, which increased by 7.8% to
$11.4 million, quarter on quarter. The Group delivered a $6.9 million net profit after tax, down slightly
compared to the same quarter last year reflecting the impact of increased interest and depreciation
costs associated with the investment in the new Blackmores Campus at Warriewood.
Blackmores’ Chief Executive Officer, Christine Holgate, was pleased with the sustained performance and
was optimistic about continued growth, but is mindful that the sales from Asia were positively affected
by the health environment, and the future contribution from the region will be impacted by the
strengthening Australian dollar.
“Blackmores out-performed market growth in our major markets this quarter,” said Ms Holgate. “We
have changed our sales structure to deepen the relationship we have with our customers and offer
better service, as well as securing new trading partnership agreements with our retailers.”
AUSTRALIA
Groundbreaking new research published in September revealed iodine supplementation to correct the
mild deficiency commonly found in Australian children led to significant improvements in cognitive brain
function. The iodine tablets developed for the New Zealand study were supplied by Blackmores.
The research attracted widespread media attention and, based on the body of evidence on the benefits
of iodine supplementation, Blackmores has improved its Child Development Range including the launch
of two teen multivitamin products and increasing the levels of this important mineral in Blackmores’
Kids Multi.
Coinciding with the opening of the Heart Research Institute’s new premises, Blackmores launched a new
range of products to support heart health which includes the first vegetable oil-derived plant sterol
supplement in Australia. The range, which includes CardiWell™ Omega Q10 for general heart health,
Blackmores Cholesterol Health™ with plant sterols for maintaining healthy cholesterol levels and
Blackmores CoQ10 which contains a powerful antioxidant to support healthy functioning of the heart.
The products are consistent with the latest scientific evidence and take into account current
recommendations from the National Heart Foundation of Australia.
The Blackmores Sydney Running Festival attracted record numbers of participants with more than
32,000 people competing in the marathon, half marathon, 9km bridge run and 3.8km family fun run
across the iconic Harbour Bridge to the Sydney Opera House. The event raised more than $1.9 million
for charities. Nearly 10,000 people registered for Blackmores’ B Your Best training program – testament
to Blackmores’ trusted position as Australians’ health coach.
Blackmores has an exciting pipeline of new products in development, including the upcoming addition of
Blackmores Executive B Sleep Formula™.
ASIA
Blackmores in Asia recorded a strong first quarter, sales up 37% on the corresponding quarter last year.
It included exceptional sales from Thailand following concerns about H1N1 and the resulting demand for
immunity products. Sales in Malaysia were supported by a national immunity-focused marketing
campaign.
“It is encouraging that in times of serious health concern, consumers have turned to Blackmores for
trusted, quality health products,” said Ms Holgate.
“Asia continues to be an important part of our business growth and, under the leadership of new
Director Asia, Peter Osborne, we expect to see the premium positioning of the Blackmores brand in Asia
continue to deliver growth in local currencies. We are optimistic about our ongoing prospects in the
region despite the strengthening Australian dollar diluting the impact of sales in Asia on the Group
result.”
In response to the devastating typhoon in Taiwan, Blackmores made a major donation of multivitamins
to the Public Health Bureau in Pingtung County, one of the areas affected by Typhoon Marokot.
NEW ZEALAND
Sales in New Zealand were up 7% compared to the same quarter last year, supported by the launch of
two new products. Kids Mineral Minds™, launched at the end of September, will join Blackmores’
successful children’s product offering in that market following the recent introduction of Kids Multi, Kids
Fruity Fishies™ and Immunoshield Junior™ to our New Zealand range.
OUTLOOK
Buoyant sales in recent months, boosted by global health concerns in Asia, have positioned the Group
well for the year ahead.
“The first quarter result has provided a pleasing start to the financial year,” said Ms Holgate. “Directors
remain confident that Blackmores is on track to achieve modest profit growth for the year.”
Contact: Sally Townsend - 0419 225 781
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