Just one day after releasing its annual results investor presentation, the infant formula and organic baby food products company Bubs Australia has revealed it wants a cash injection from investors.
Bubs Australia requested a trading halt on Wednesday morning, “pending an announcement regarding a proposed capital raising”.
Shares in Bubs had fallen sharply on Tuesday, by 7?? (or 10.2 per cent) to close at 61.5??, as the market reacted to its preliminary results for fiscal 2017.
When it started trading on the ASX in January, following a backdoor listing, its shares were worth 10??. In late July, before the rapid surge, Bubs was trading in the low 30?? range.
The company, which has a market capitalisation of about $117 million, reported a statutory loss before tax of $5.04 million, and revenue of $4.53 million for the year.
The brief ASX statement requested a trading halt until the commencement of normal trading on Friday, 1 September, or possibly earlier.
The company’s stock had risen sharply between late July and late August, hitting a peak of 96.5?? on 22 August.
In an ASX release on Monday, Bubs Australia chief executive Nicholas Simms said the company was pleased with the “strategic achievements” since Bubs listed on the ASX in January.
“Since listing, we have significantly reshaped the business and invested heavily in building channel capacity, both domestically by doubling our footprint, and internationally, principally into China with several ecommerce platform agreements and a strategic partnership with Brilite Nutritionals,” he said.
“The financial results for the year therefore reflect a business in transition following the transaction leading to the re-listing of the business on the Australian Securities Exchange,” he said.
Bubs Australia also told the market on Monday that the company had recorded “consistent sales growth quarter on quarter” during fiscal 2017, second-half domestic revenue was 33 per cent up on first half, and second-half China revenue was 67 per cent greater than in the first half.
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