OptiBiotix reports solid first-half operational progress

20th Aug 2024 11:47

(Sharecast News) - Obesity-focussed life science company OptiBiotix Health updated the market on its commercial activities for the first half on Tuesday, reported significant advancements in expanding its presence in key markets, particularly in the United States and Asia, while also investing in direct-to-consumer e-commerce channels to drive growth and profitability.

The AIM-traded firm said that in the US, it had successfully increased its number of partnerships and sales.

A major development was the launch of its LeanBiome product within MuscleTech's Nitro Tech Ripped range - a leading sports nutrition brand in the US.

Furthermore, the company secured its first order from a Nasdaq-listed e-commerce company for a new tomato soup product, scheduled for launch in January 2025.

The company said it also achieved substantial progress in Asia, a region characterised by high growth rates and large consumer markets.

OptiBiotix said it had established new partnerships and initiated product launches in several key countries, including India, Vietnam, Thailand, Indonesia, and Malaysia.

A notable development was the agreement with Dr Morepen, a well-known brand in India, which was expected to contribute significantly to OptiBiotix's revenue, with projections of £6m to £7m annually within the next four to five years, supported by initial product launches set for the third quarter of 2024.

OptiBiotix said it had also placed a strong emphasis on growing its e-commerce business to reduce reliance on traditional retail partners and increase profit margins.

In the first half, its e-commerce sales surpassed the entire revenue generated in 2023, driven by strong performances on its online platform and Amazon UK.

SlimBiome, one of its flagship products, became a top seller on Amazon during Prime month in July.

Financially, OptiBiotix said it was on a positive trajectory, with sales orders in the first six months nearing £0.6m, almost matching the total revenue of £0.64m for the full 2023 year.

Looking ahead, OptiBiotix said it was optimistic about its growth prospects, particularly as new products were launched and existing partnerships continued to develop.

The company said it was also receiving significant interest in its second-generation products, such as SweetBiotix, which could lead to large-scale production and further revenue growth.

As the partnerships and products matured, OptiBiotix anticipated that its ongoing efforts would lead to substantial growth and profitability, potentially transforming the company's financial landscape in the coming years.

"We have made real progress this year in progressing our commercialisation strategy of broadening our partner base by securing a number of new corporate partners in key strategic markets like the US and Asia, investing in e-commerce channels, and selling more final product," said chief executive officer Stephen O'Hara.

"We continue to see sales momentum building in 2024 with sales orders received in the first half of 2024 approaching full-year 2023 reported revenue, and in July 2024 surpassing it.

"Having spent a number of years carrying out clinical studies to gain health claims on our first generation products, we are now gaining commercial traction with large partners in key markets."

O'Hara said the company anticipated that the trend would continue in 2024, and hoped to add to that, other partners who were interested in the company's "potentially industry changing" second-generation products.

"With appetite suppression, gut health, sugar alternatives, and modulation of the human microbiome attracting ever-increasing interest, we look to the future with a high degree of confidence."

At 1110 BST, shares in OptiBiotix Health were down 6.67% at 23.1p.

Reporting by Josh White for Sharecast.com.