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How Holista Colltech (ASX:HCT) is fast-tracking its growth into FY22

Image Source: HCT website

Highlights

  • Holista has established a track record with strong sales performance in 2020 and continued growth momentum in 2021.
  • Ongoing efficiency drive and organic growth opportunities from the Company’s expanded product portfolio are anticipated to benefit its cash position. 
  • Holista is well-positioned for growth, backed by various factors like global reach of its proven products, and large addressable and growing markets in health/wellness.

The journey of Holista Colltech Limited (ASX:HCT) in 2021 has been nothing less than remarkable, laying the foundation for a stronger 2022. The Company continues to increase its sales by harnessing its world-leading technologies and reach in the US$4.5 trillion global health & wellness industry.

After recording sales of over AU$7 million in 2020, the group reported a 30% increase in revenue to AU$3.6 million in the first half of 2021. What’s more, the recently released figures reflect a 13% quarter-on-quarter jump in group sales to AU$1.9 million in Q3 ended 30 September 2021, while total year-to-date customer receipts edged up by 20% pcp across the group.

GOOD WATCH: How is Holista Colltech tapping market opportunities steered by Covid-19 outbreak?

The Company’s strong product portfolio ranges from low-GI food ingredients used by leading food manufacturers to all-natural sanitisers for consumer and industrial applications, market-leading dietary supplements, and disease-free ovine collagen.

These products are managed by the Company’s four divisions, which have proven to be growth engines and are positioned for solid growth.

ALSO READ: Holista Colltech (ASX:HCT) clocks robust sales revenue across all divisions in 1H  

Let us look at significant developments across all the four divisions and their growth outlook.

Healthy Food Ingredients - The fastest growing division

The fastest-growing division, Healthy Food Ingredients, saw its sales increase by 45% in Q3 2021 over pcp, driven by GI Lite™ and 80Less™.

Growth was driven by Costanzo’s orders despite the pandemic in the US. Costanzo’s plans to launch a marketing and promotional campaign next month to drive further sales of the low-GI white bread made with Holista’s GI LiteTM innovation.

In addition, the Company’s partnership with Berjaya’s Country Farms presents opportunities into several leading franchises in Malaysia, such as Starbucks, Kenny Rogers, and 7-Eleven. 

RELATED ARTICLE: Holista Colltech (ASX:HCT) in excellent shape with fast-growing Healthy Food Ingredients segment

Holista Colltech (ASX:HCT) healthy food products may be heading to Starbucks and 7-Eleven in Malaysia

Infection Control sees significant developments

Natshield™ brand received Trademark approval for sales in China. In persistence tests undertaken by SGS and Chemlab in Malaysia, Natshield™ has been proven to last up to 12 hours on skin and hard surfaces. 

Moreover, the Company plans to launch the world’s first Nasal Protecting Balm active for 12 hours in Q4 2021 in Malaysia, South America, and the US. The Nasal protecting balm contains 5% Path-Away® / Protectene™ that has been proven to kill SARS-CoV-2 99.9% within two minutes. Moreover, its PH 5.5 formulation prevents pathogen growth on skin.

Holista is also making headway to secure test kit opportunities in the US, South America, and the US, pending regulatory approvals. 

Source: HCT Presentation, dated 12 November 2021

RELATED ARTICLE: Holista Colltech (ASX:HCT) bags Chinese trademark labelling approval for Natshield™

Holista’s highly sought-after Ovine Collagen

Holista is the world’s first and only Company to extract ovine collagen from Australian sheep. The premium-grade ovine collagen is produced at a Western Australia-based production facility in Collie using patented technology. 

The Company has signed an agreement with China-based state-owned enterprise Guangzhou Sinbio Cosmetic Co Ltd to trial the unique collagen product. If the trial is successful, it will lead to a binding sales agreement that will see the Chinese conglomerate purchase all of Holista’s annual production. The deal will enable Holista to expand its plant capacity over the next four years and potentially generate over AU$40 million in annual sales.

Source: HCT Presentation, dated 12 November 2021

Dietary Supplements – The standout division  

Dietary Supplements saw double-digit growth in sales in Q3 2021 over pcp, driven by the rebound from COVID-19 and launch of new supplements such as Hydro D, a water-soluble Vitamin D. A rebound in retail spending bolstered the demand for the Company’s vitamins and supplements as Malaysia eased COVID-19 restrictions. 

The cash cow business contributed ~70% of 2021 Group revenue with market-leading products. 

ALSO READ: What’s fuelling growth of Holista Colltech’s (ASX:HCT) cash cow Dietary Supplements Division?

What contributes to improved outlook for 2022

Holista is positioned to grow in 2022, backed by several significant growth opportunities, improving trading conditions, cost optimisation, organic growth, and supportive global trends.

Image data: HCT Presentation, 12 November 2021

HCT shares traded at AU$0.053 on 15 November 2021.


 


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