The BWX Limited (ASX: BWX) share price finished 30% higher on Friday after reporting its half year result.
BWX is a wholesale distributor and owner of skincare and other wellness products for the beauty sector. It’s best-known for its range of Sukin skincare products, but it also owns Andalou Naturals, Mineral Fusion and Edward Beale. Its products are sold throughout Australia and USA, and the range is available online throughout Asia.
Why BWX Shares Are Going Bananas
The natural beauty business said that it grew revenue in the first half by 1.4% to $68.1 million. However, reported EBITDA declined by 40.5% to $7.2 million (click here to learn what EBITDA means) and net profit after tax (NPAT) fell by 51.8% to $2.6 million.
It was a mixed bag for each of its brands. Sukin sales dropped 36% to $23.2 million, Andalou Naturals revenue grew 182% to $23.1 million, Mineral Fusion revenue dropped 27% to $9.9 million and Nourished Life revenue increased by 53% to $10.4 million.
BWX said that Sukin revenue was heavily impacted by the ERP (enterprise resource planning software) rollout in the first quarter which resulted in lost sales.
BWX decided to not pay an interim dividend in light of its negative net operating cash flow of $7.3 million.
BWX Managing Director and CEO Myles Anceschi said: “We faced several challenges in the half as we re-set the business and executed our change programs. The major issues are now behind us and we are gaining momentum”.
Is BWX a buy?
Investors may have been pleased to know that Sukin revenue more than doubled in the second quarter compared to the first quarter and the market share continues to grow.
Management are now guiding underlying EBITDA will be between $27 million to $29 million. The botched buy-out certainly caused a lot of problems and it is currently being sued.
Whilst BWX’s share price did strongly today, it might be better to invest in other shares that aren’t facing a variety of issues such as the ones mentioned in the free report below that are growing rapidly internationally.
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