IPO Watch: EZZ Life Science hits the ASX and gains 50 per cent
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This morning saw the IPO of beauty and wellness company EZZ Life Science (ASX:EZZ) and it surged 50 per cent.
EZZ, which distributes the popular EAORON skincare products as well as its own health supplements, raised $6 million at 50 cents per share under its IPO offer.
Beauty products may not be the most exciting sector but it is home to several companies including Silk Laser (ASX:SLA), which operates brick and mortar clinics and only listed in December and BWX (ASX:BWX) which also sells beauty products and is a $600m company.
EZZ has tried to woo investors with their profitability but also with the promise it will pay dividends and manufacture in Australia. It made a pro forma FY20 net profit after tax of $949,000 and grew revenues by 50 per cent in that year.
“EZZ is delighted at the prospect of listing on the ASX as a young and profitable company,” said chair Phillipa Lewis.
“We are unusual – debuting as a micro-cap that’s not only profitable and cashflow positive, but also expecting to pay dividends in our first year on market.”
EZZ debuted at 11am and rose to 75 cents – a 50 per cent premium to its IPO price.
Speaking with Stockhead later in the afternoon Lewis said she was “very happy with the result.
“It’s great, firstly to get a company to a listing – it’s no mean feat to do – but its great to have first day performance where there’s a lot liquidity, a lot of trades and the stock is performing well,” she said.
EZZ says it will use the IPO proceeds to expand the distribution of both the EAORON and EZZ products both in Australasia and in overseas markets.
The EAORON-branded facial masks currently represents 17.8 per cent of the market and EZZ is hoping this will grow.
For the record, these is not the facial masks you wear to stop COVID-19 transmission but those you wear on your face to improve your skin.
EZZ has also promised to establish a bespoke retail store to help it engage with its retail customer base and showcase its range.
“We will continue to upgrade to flagship products, introduce new products and build our brands in order to deliver value to our shareholders,” said CEO Fernando Rodriguez.
Lewis clarified with Stockhead this would be in the Sydney CBD but it would be a one-off.
“It’s more of a one off bespoke project and it’s all about engaging directly with consumers so they can have an immersed experience with the products,” she said.
“We think just having a presence available to consumers, to come try the products and be educated about the products, it will enhance their experience.
“But also, we’ve got a big retail distribution and this is also to help out our retailers. It’s increasing our brand awareness, allowing the end consumer to properly experience the products in a beautiful setting.
“So [we’re] not necessarily planning any retail push [going] forward but this is more of a strategic marketing program for us.”