Else Nutrition (BABY.V) Shakes it Up, Expands Product Range on iHerb to Over 180 Countries

Babies suck. They are arguably the world’s biggest narcissists, crying if you don’t give them attention, only caring about themselves, and expecting everyone else to do things for them. Have they tried working a nine-to-five job? Jokes aside, I think starting a family is something to cherish and look forward to. However, finding a baby food that is safe for your child is more of a monumental task than people think. According to a report from the US House Committee on Oversight and Report, several commercial baby foods are tainted with dangerous levels of arsenic, lead, cadmium, and mercury. Keep in mind, this report was based on information from just four baby food companies, including Nurture, Beech-Nut, Hain, and Gerber. To make matters worse, when Walmart, Sprout, and Campbell’s Soup were asked to provide the same information about their baby food products, they declined.

Let’s take a moment to consider that the Global Baby Food Market was valued at USD$67.3 billion in 2019. By 2027, this market is expected to reach USD$96.3 billion, expanding at a respectable CAGR of 6% from 2021 to 2027. As the number of working women increases, there is less time for food preparation and breastfeeding, which necessitates the use of baby food. Before you get your pitchforks out, I am not making a misogynistic assumption that women are expected to take care of the children. While the number of stay-at-home dads has increased, men only made up 17% of all stay-at-home parents in the US in 2016. In the same year, mothers spent an average of 14 hours a week on child care.

With this in mind, the number of women participating in the labour force has increased steadily since the 1950s, where about one-quarter of women aged 25 to 54 participated in the labour market. By 1990, the participation rate for women grew by 93% while the participation rate for men fell from 96% to 93%, according to Statistics Canada. As previously mentioned, an increase in working women has led many families to rely on baby food in order to substitute meal preparation and breastfeeding. However, that doesn’t make what we feeding our children any less important.

Else Nutrition Holdings Inc.

$180.259M Market Capitalization

Else Nutrition Holdings Inc. (BABY.V) is an Israel-based food and nutrition company focused on the development of innovative, clean, and plant-based food and nutrition products. The Company’s products are intended for infants, toddlers, children, and adults. Furthermore, Else Nutrition has developed a plant-based, non-soy, formula that is a clean-ingredient alternative to dairy-based formula. It is worth noting that the Company’s formula has been tested for heavy metals of concern such as arsenic, cadmium, lead, and mercury. Test results demonstrated that Else Nutrition’s formula did not contain any of the aforementioned metals. What is this, an episode of Jerry Springer?

What has Else Nutrition been up to lately? On October 20, 2021, the Company announced that it had closed its previously announced marketed public offering of units for aggregate gross proceeds of approximately $17.3 million, including the exercise of the over-allotment option in full. Else Nutrition issued 8,050,000 units at a price of $2.15 per unit, each unit consisting of one common share of the Company and one-half of one common share purchase warrant.

According to the terms, each full warrant will be exercisable to acquire one common share at a price of $2.70 per common share until October 20, 2026. Additionally, Else Nutrition has received conditional approval from the TSX Venture Exchange to list the warrants issued pursuant to the offering, and the warrants are expected to be listed and posted for trading on the TSXV under the ticker BABY.WT.A, effective on or about October 27, 2021. According to Else Nutrition, the net proceeds from the offering will be used to establish a manufacturing facility, acquire inventory, fund R&D, fund sales, and marketing for general corporate purposes.

Most recently, on October 28, 2021, Else Nutrition announced that it would be expanding its current line of Plant-Based Nutrition products with iHerb, a US-based, international online retailer of nutritional and healthcare products. Headquartered in Morena Valley, California, iHerb offers supplements, herbs, bathing and beauty products, grocery, kids accessories, and sports goods. Planned for November 2021, Else’s Plant-Powered Complete Nutrition Shakes for Kids will also be made available on iHerb, in both chocolate and vanilla flavours. In addition to expanding Else Nutrition’s offering on iHerb, this agreement will also improve the Company’s gateway to global online customers in more than 180 countries.

Our distribution partnership with iHerb Inc. continues to grow with great progress…Our relationship with iHerb continues with great momentum through iHerb’s online sales platform and ensures Else products are accessible to Plant-Based wanting consumers worldwide, she added,” said Hamutal Yitzhak, CEO and Co-Founder of Else Nutrition.

Financials

According to Else Nutrition’s Q2 2021 Financial Results, the Company had cash and cash equivalents of CAD$15,946,000. For the three months ended June 30, 2021, Else Nutrition’s reported revenue increased to CAD$1,114,000 compared to CAD$210,000 year-over-year (YOY). In the same period, the Company reported a net loss of CAD$4,753,000 compared to CAD$4,495,000 YOY. In terms of milestones, Else Nutrition successfully launched its second product, Complete Nutrition for Kids, on the Company’s online platform as well as on Amazon.com. With this in mind, Else Nutrition was able to substantially increase its online sales by 40%. Furthermore, the Company was able to achieve a significant US retail presence in more than 1,000 listed stores, including Big-Y, Vitamin Cottage, and PCC Community Market stores, to name just a few.

“I am very proud of our achievements this quarter. We continued to demonstrate rapid growth in our online business while we successfully launched many more retail stores, reaching 1,000 listed stores. We successfully launched our second product line and grew our product range, and we expect growth to continue and accelerate throughout the remainder of the year,” commented Hamutal Yitzhak.

Overall, Else Nutrition has made a name for itself as one of the few plant-based companies in the global baby food market. Else Nutrition also has several achievements under its belt, including the “2017 Best Health and Diet Solutions,” which the Company won at the Global Food Innovation Summit in Milan. Additionally, the Company’s Else Plant-Based Complete Nutrition for Toddlers was recently ranked as the #1 Top Seller in the Baby and Toddlers Formula category on Amazon. With this in mind, Else Nutrition is addressing a market where there is a serious need for safe baby food alternatives. Making sure your kid isn’t shoving Legos down their throat is hard enough as it is; choosing the right baby food shouldn’t be nearly as difficult. That being said, I am interested to see what Else the Company has in store.