OptiBiotix Health reports 'strong' progress in first half

Life sciences company OptiBiotix Health reported a “strong” first half of trading on Wednesday, as sales revenue soared 195% to £0.35m.

The AIM-traded firm said considering the like-for-like increase, accounting for probiotic sales in the six months ended 30 June, the growth rate was an impressive 251%.

It experienced a substantial 154% boost in gross profit, escalating from £0.06m in the first half of 2022 to £0.16m in the current reporting period.

Administrative expenses decreased 17.3%, falling from £1.11m to £0.92m.

Existing partner sales gradually met expectations, with new order placements from notable companies, including THG and Holland & Barrett.

Meanwhile, Apollo Pharmacies in India and Nahdi Medical in Saudi Arabia demonstrated enhanced sales performance, with increases of 500% and 30%, respectively.

The company started partnerships with three new Asian entities, which initiated their business relationship by placing orders for OptiBiotix's SlimBiome product.

Its e-commerce channel meanwhile saw robust sales growth of the company's own-brand products, while an order worth £0.12m for SlimBiome from a US-based weight management and sports nutrition brand was achieved.

Looking at its online growth and product expansion, OptiBiotix successfully listed its SlimBiome Medical and Gofigure products on Amazon UK in February.

Future expansions on global platforms such as Amazon India, the Gulf states, Amazon US and Walmart US were planned throughout the year.

Its recently launched gut and digestive health product, WellBiome, received commendable feedback, reflected in increasing sales and repeated purchase rates.

Plans to amplify its marketing efforts and availability on global Amazon platforms were slated for the fourth quarter.

On the research and development front, OptiBiotix published the findings from its third human study on SlimBiome, showcasing the product's significant advantages in appetite and hunger management from a single dosage.

The firm also reported considerable advancements in manufacturing its microbiome modulators and SweetBiotix range, which it said held the potential for targeted human disease treatments and offered prospects for future growth.

OptiBiotix said it remained debt-free and boasted valuable assets in SkinBioTherapeutics and ProBiotix Health, strengthening its balance sheet.

“The focus for 2023 has been on moving the business to profitability by a reduction in costs, a focus on existing partners returning to forecast, bringing in new partners, particularly in the US and Asia, and expanding e-commerce channels to reduce partner dependency,” said chief executive officer Stephen O'Hara.

“Good progress has been made in each of these areas.

“This is all part of plans for each business unit - US, India, e-commerce, B2B - to reach profitability, at least on a monthly basis, by the end of the calendar year.”

O'Hara said the aim for the year's second half would be to maintain focus on managing costs, growing sales and closing out ongoing discussions with several more significant partners across first and second-generation products to ensure a return on investment from the expansion of the commercial and business development teams.

“We are particularly excited about our second-generation products approaching commercialisation given their uniqueness in the marketplace.

“Our sweet prebiotic fibres, called SweetBiotix, create the opportunity to replace unhealthy calorific and cariogenic sugars with healthy fibres in a wide range of food and beverage products.

“With growing health concerns over traditional sugars and sweeteners, the commercialisation of SweetBiotix meets a large global market need.”

After many years of work, Stephen O'Hara said the firm was equally pleased with the significant progress made in 2023 in the manufacturing scale-up of its microbiome modulators, which selectively enhance the growth rate of specific types of bacteria and create the potential for targeted treatment of a range of human diseases.

“We believe these unique products, individually and collectively, offer shareholders the potential for a significant enhancement in the value of the company.

“The group has no debt, a strong balance sheet, and retains significant exposure to the considerable growth potential of the microbiome through its shareholdings in ProBiotix Health and SkinBioTherapeutics.”

At 1007 BST, shares in OptiBiotix Health were down 9.09% at 24p.

Reporting by Josh White for Sharecast.com.