Skin Elements’ (ASX: SKN) June quarter focused on SuprCuvr product expansion - Kalkine Media

Highlights

• Skin Elements’ (ASX: SKN) June quarter was focused on business development activites
• During the quarter, SKN made progress regarding distribution agreements and product expansion of SuprCuvr
• The company’s Soleo Organics Sunscreen witnessed good traction during the quarter

ASX-listed natural skincare company Skin Elements Limited (ASX: SKN) has provided updates for the quarter ended 30 June 2022. It was a busy quarter for SKN, with a major focus on business development activities. Let us see how the company fared during the quarter.

Distribution Agreements for SuprCuvr

Pacific Health distribution agreement

SuprCuvr, made wholly of plant-based formula, is a TGA-registered hospital-grade disinfectant. As per Skin Elements’ research, SuprCuvr is the first and only certified disinfectant worldwide with a 99.99999% effectiveness against COVID 19.

In January 2022, Skin Elements entered into a binding agreement with Pacific Health Care Pty Ltd (Pacific Health) for the exclusive supply of SuprCuvr in Australia and New Zealand.

During the quarter, Pacific Health made robust progress in the distribution of SuprCuvr, with a focus on the retail, corporate, and government sector.

SuprCuvr is sold in 168 IGA and 15 Good Grocer IGA supermarkets in Western Australia. It is also available through Pacific Health’s online store: www.pacifichealthcare.com.au.

Progress in the government sector – In the June quarter, Pacific Health took a substantial step to secure contracts for SuprCuvr with Western Australia and Queensland governments. It has completed the process to get SuprCuvr included in the formal tender lists for government departments in these provinces.

For SKN, the government sector is a major focus area for the rollout of SuprCuvr. It offers the prospect of implementing the product across various government bodies and departments in huge settings. Pacific Health also made presentations to major private hospitals in WA and other states.

Additionally, it executed trials with education campuses, mining companies, and transport and logistics centres in WA.

Distribution opportunities in international markets – During the quarter, Skin Elements advanced distribution opportunities, including SuprCuvr in New Zealand and for SuprCuvr and other SKN products in Taiwan and Indonesia.

Further, it also started discussions regarding a potential distribution pact for the Soleo Organics sunscreen range in the United Kingdom.

Expansion of SuprCuvr product range

Skin Elements is studying the development of new products of SuprCuvr at a lower price and is currently in discussion with a major global retailer regarding the same.

Skin Elements has also studied the possibilities of expanding the use of SuprCuvr beyond a hospital-grade disinfectant. It carried out independent laboratory tests during the quarter to test the anti-fungal capacity of SuprCuvr. The tests resulted in a positive outcome, widening the scope for SuprCuvr’s applications. SKN plans to advance these opportunities for expanding SuprCuvr ‘s product range.

The quarter also saw SKN make efforts towards sales and marketing of SuprCuvr. On this front, SKN worked on video advertisements and marketing materials, and updated SuperCuvr packaging to reduce costs and simplify production.

Soleo Organics Sunscreen

Image source: © 2022 Kalkine Media®, SKN website

Image description: Sunscreens from Soleo Organics

During the quarter, the company’s organic sunscreens – Soleo Organics’ High-Performance Coconut Sunscreen and Face Moisturising Sunscreen were both selected as finalists in the Clean Beauty Awards for 2022. 

The Soleo Organics sunscreen range is now fully available on the company’s updated online store websites to draw more international sales and notch up larger sales volume.

Corporate activity

SKN received a research and development rebate advance of AU$363K for the R&D expenditure invested in the period to May 2022.

In April, SKN entered an agreement with LDA capital under which the latter has committed to providing equity capital of AU$20 million for three years.

Financial update

Even though SKN’s business during the quarter took a hit due to COVID-19, the company is looking forward to brighter times ahead as restrictions have eased. As part of its strategy to adapt to living with COVID-19, SKN sees strong opportunity to expand sales of SuprCuvr and the Invisi Shield® natural sanitiser product.

The breakdown of the operating cashflow is as following:

• Customer receipts - AU$208k
• Product manufacturing, staff and research and development - AU$574K