The Calmer Co is capitalising on the booming Kava health trend. Pic: Getty Images.
Health & Biotech
Special Report: The Calmer Co International (ASX:CCO) is capitalising on Kava as a health trend with sales booming in Australia and Coles expanding its range of the company’s product, while it also works to gain a foothold in the lucrative US market.
In CCO’s annual report founder Zane Yoshida said the past year had been transformative for the company and kava industry on several fronts.
“We continue to see strong interest and adoption of noble kava in markets in which we operate at a time when Pacific Island governments have just recently come together to launch the Regional Kava Development Strategy (RKDS), which will focus on a more resilient, inclusive and sustainable kava industry for the benefit of our communities and future generations,” he said.
“This supports our vision and mission and our commitment to bringing calm and balance to the lives of people around the world.”
The health and wellness company focuses on kava and other natural products that promote calmness, support mind and muscle relaxation and improve sleep.
Products are delivered to consumers as functional beverages, drinking powders, capsules, teas, shots and concentrates under three brands – Fiji Kava, Taki Mai and Danodan Hempworks.
The company sells direct to consumers online in Australia, the US, China and the Pacific islands in addition to growing blue chip retail partnerships with Coles Group (ASX:COL), Amazon and Walmart.com.
Formerly called Fiji Kava (ASX:FIJ), CCO is one of the first foreign companies to be granted approval from the Fijian government to operate in the kava industry.
“Our roots in FijiKava gave us a strong foundation in the natural wellness space, grounded in the rich traditions of the Pacific Islands,” Yoshida said.
“Today, as The Calmer Co International, we’re broadening our focus to encompass a wider range of kava formats that cater to the global demand for wellness products that are both effective and ethically sourced.”
Yoshida said CCO is committed to expanding its product portfolio, entering new markets, and innovating in ways that stay true to its core values.
“We remain deeply committed to the principles that guided us as FijiKava – sustainability, respect for nature, and a dedication to improving the quality of life for our customers,” he said.
Yoshida said 2024 had been a year of significant growth for CCO, which had expanded its reach across international markets.
“Our product lines have grown to include not only our premium kava products but also a range of other natural supplements designed to support mental and physical well-being,” he said.
“This year, we’ve invested in new research and development initiatives, exploring the potential of different extract formats and refining our existing products to meet the highest standards of quality and efficacy.”
CCO’s ecommerce sales showed strong growth month-on-month during FY24 and exceeded $18,500/day at the end of June 2024 and have grown to over $20,000/day in August, according to a recent shareholder update from COO.
Driven primarily by success in Australia CCO plans to roll out its ecommerce marketing process in the US market.
The company reported total sales eclipsed $4m with almost half of this revenue ($1.85m) recognised in Q4, FY2. Total ecommerce revenue for FY24 was $3m.
The sales acceleration has continued into FY25 according to the company’s annual report with Q4 results reflecting “annualized revenue of $7.2m … followed by a record monthly revenue result in July 2024 of $764k (unaudited, preliminary); representing an annualised revenue ‘run rate’ more than $9m.
“With the use of digital marketing we have been able to find a huge new market of health-conscious consumers looking to benefit from the therapeutic value of kava,” the company said.
The company has grown its consumer database to more than 50,000 people and during FY24 developed remarketing campaigns to generate repeat purchases from its customer base.
The Oceania market generated 65% of total revenues in FY24. Revenues in the region totalled $2.8m, up 627% on pcp, led primarily by ecommerce.
“Following one out-of-stock event, we have improved all of our processes across stock control, online ordering and digital and retail distribution,” CCO said.
“We leveraged these systems and processes to scale up in FY24 and kept up with booming sales growth.
CCO recently announced Coles is set to expand CCO’s product range by 40%, significantly increasing the availability of its kava products and potentially driving substantial sales growth.
“This greatly extends our national retail footprint and validates a broader trend of drinking kava for health purposes,” CCO said in its annual report.
Total sales in the Americas were $1.5m, up 82% on pcp.
“We have maintained a solid business in the Americas market with Amazon where FijiKava 150g is the best-selling instant kava product,” CCO said.
“We have launched our own ecommerce store with Shopify, partnered with Walmart.com and stocked up our warehouse in preparation for a new marketing push.”
Managing director and CEO Anthony Noble said several hard decisions were made in FY24 as the company looked to simplify its business model, product offering and routes to market.
“Our board of directors have all leaned in across their various areas of expertise to ensure those decisions were executed,” he said.
“The result is that we have a business that is well on its way to scale in high margin sales channels.
“Our mission for FY25 is to deliver that scale and the key to this will be to grow our USA business alongside our Australian and Fijian businesses.
“I remain confident that we have the team, the culture and the commitment to purpose to deliver on that mission.”
CCO said it plans to also launch several new products in FY25 that it believes will make a significant impact on the wellness industry.
This article was developed in collaboration with The Calmer Co, 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.
Health & Biotech
Health & Biotech
Health & Biotech
