Bubs Australia Limited (ASX: BUB), a company from food, beverage and tobacco industries which is the manufacturer of infant milk in Australia announced the release of additional 5,844,242 Options from its ASX escrow account. It had also raised 47,959,050 ordinary shares in the previous month which was published on 17 December 2018. The company has also issued 38,401,340 ordinary shares during the acquisition of Nulac Foods on 20 December 2018. The company along with Nulac Foods is stepping towards its global vision where the stock was released from the escrow to continue the strong trading fundamental. In this regard, the company has already declared the release of additional 5,844,242 Options on 17 December 2018.
The application of quotation of released share highlights that Bubs Australia Limited holding the registration number 63,060,094,742 can issue 64,728,114 further fully paid ordinary shares to the market. At present, there are around 441,505,867 shares which are quoted on ASX. Also, there are about 5,844,242 IOC Options which are still not quoted on ASX where dividend policy is not applicable.
There are around 47,959,050 other securities which are fully paid ordinary shares, and the quotation is sought. These fully paid ordinary shares rank equally in all aspects. The reason for the request of quotation of these shares was that 3 January 2019 was the end of ASX Imposed Restriction Period. These shares have got quoted on ASX.
Bubs Australia Limited remains an average performer amongst its peer group. Its performance in the past five years was 290% which is quite impressive. The previous year performance of the company was -40.91%. However, a negative performance is seen in many companies falling under the same industry.
The entire FY2018 highlights the gross sales of $18.4 million with a year on year increase by 330% in net revenue. The net revenue for the period was $16.91 million with a gross profit of 14%. However, the net loss incurred during the period was heavy as per the financial statements. The gross margin was adversely affected as a result of product mix during the acquisition of Nulac Foods. The gross revenue was majorly driven by the domestic sales account which accounts for 84% of the total revenue. However, the integration of Nulac Foods helped in increasing the sales volume in the second half of FY2018. The increase in the sale of domestic sales of Infant formula helped the company in increasing the sales volume.
Although through the acquisition of Nulac Foods, there is a growth in its gross profit but the fact that impact on the gross margin and the loss made during the period might have created an adverse influence of the investors and the shareholders of the company. It might be possible that the investors are a little skeptical about the future performance of the company and they are also not ready to take a further risk which has led the share price tumble by 1.099%. By the end of the market close on 3 January 2019, the closing price of the share was $0.450 which is 0.005 points below its previous day’s closing price with the market capitalization of $200.89 million.
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