Despite challenging macroeconomic conditions and continued fallout from the COVID-19 pandemic during FY22, one ASX-listed life science company set itself up for future growth. 

Genomic-tech firm EZZ Life Science Holdings (ASX:EZZ) said it remains in a strong position for growth throughout FY23 building upon strong foundations put in place during FY22.

In his address in the annual report to shareholders for the year ended 30 June 2022, EZZ non-executive chairman Glenn Cross said the company continues to operate in uncertain times.

“In 2022, we continued to operate in uncertain times with the COVID-19 pandemic providing many challenges to the macroeconomic outlook,” he said.

“I am very proud of the approach the EZZ team has taken to sustain the company’s performance despite the social, health, and economic volatilities over the past year to deliver another solid financial result.”

EZZ listed on the ASX in March 2022 and develops, produces, and markets a range of health and wellbeing products under the EZZ brand both domestically and internationally.

The company also distributes a series of skincare products under the EAORON brand in both Australia and New Zealand.


Strong turnaround in H2 FY22

In the first half of FY22, Cross said a strategic decision was made to reduce marketing and advertising expenditure in response to continued market uncertainties.

He said this led to a decline in revenue by approximately 50% from $13 million in H1 FY21 to $6 million in H1 FY22.

However, EZZ’s financial performance rebounded strongly in the second half of FY22 generating revenue of $9 million.

“The EZZ team delivered a successful turnaround by diversifying key distribution channels, increasing revenue by 42% from 1H FY22 and bringing total revenue for FY22 to over $15 million,” Cross said.

He said in a challenging macro environment EZZ had maintained profitability and a balance sheet strength with $10.5 million cash at bank as of June 30, 2022, placing the company in a strong position to pursue growth initiatives.


CEO Search as China opportunities grow

EZZ continues to search for a new Chief Executive Officer is underway following the resignation of Luis F. Rodriguez Bravo.

Cross said the board was focused on strengthening the mix of skills, experience, and market knowledge to support EZZ’s long-term sustainable competitive advantage and growth.

Interim CEO Mark (Qizhou) Qin said EZZ had achieved another year of solid progress by capitalising on the team’s ability to capture emerging opportunities in an unpredictable and often challenging external market environment.

“Our omni-channel direct-to-consumer strategy has been optimised to deliver improved results with a focus on high growth markets and product categories,” he said.

“Momentum continues to build on top of market-driven product development, diversified distribution channels and digitally focused marketing strategies.”

Qin said instead of relying on one key distribution channel for the EZZ branded products in its key market of China, the EZZ team successfully expanded to multiple channels to build a future-proof distribution network.

“In addition to Tmall Global, the company commenced a cross-border e-commerce store on Douyin, mainland China’s version of TikTok, and delivered revenue growth exceeding management’s expectations in the first month of operation,” he said.

There were seven new products launched under the EZZ brand in FY22.  The L-Lysine Growth Capsule became another flagship product contributing 27% to the revenue derived from EZZ branded products.

“Our market-driven product development approach continues to differentiate EZZ from its competitors,” Qin said.


EZZ launches own e-commerce platform

EZZ’s own e-commerce platform has also been launched which Qin said would unlock data backed analytical capability to enable data driven decision making and improve efficiency of scale.

“The investment in our in-house e-commerce capability is expected to significantly reduce marketing expenses and generate strong incremental EBITDA growth over the next three years,” he said.

“It will also provide opportunities to upgrade the skills of EZZ’s experienced operations team and improve the way EZZ’s customers are served. “

“This platform will also enable new technology-backed services, strengthening our sustainable long-term competitive advantage and fuel our next phase of organic growth.”

With a vision of ‘improving quality of life and human health’, in March EZZ had its listing changed on the ASX from retail to a pharmaceutical, biotechnology and life sciences company.

“EZZ continues to build strong cross-functional support including genomic research, in-house manufacturing, omni-channel sales and marketing, and in-house data analytics technology,” Qin said.

Cross said EZZ was geared for future growth both domestically and internationally.

“EZZ is well positioned to emerge in both domestic and international markets with improved channel diversification, market driven product development, and a deeply knowledgeable leadership team as it drives sustainable growth,” he said.


This article was developed in collaboration with EZZ Life Science Holdings, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.