Full Year 2022 Bon Natural Life Ltd Earnings Call

Good day and welcome to the Bon Natural life fiscal year 2022 Limited earnings Conference call.

All participants will be in listen only mode.

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Questions will be addressed after the formal presentation has ended.

Please note this event is being recorded.

I would now like to turn the conference over to you redo it.

Buster relations of the company. Please go ahead.

Thank you operator, thank you all for joining us for both physical your 2022.

Physical results conference call one of them has issued a press release announcing that physical year 2022 financial results earlier this morning.

A copy of the release and the financial reports can be found on E. G O V.

Please note that this call is being recorded live and will be available for replay.

Please take a moment to review our forward looking statements.

During the call we will be making forward looking statements about the company's performance and business outlook. These statements are based on how we do you think today campaign elements of uncertainty.

Additional information concerning the factors that may cause results that are materially different from our forward looking statements. Please refer to our cautionary statement and risk factors stated in today's press release.

Joining me today on the small or the chairman and CEO of the company Mr. Rehaut.

The Apple must been told me feel old knows English at C. M. O. That's one junction I'll now turn the call over to our chairman and CEO , Mr. Hu, who will be speaking in St. Pete and I will translate his opening remarks into English.

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Thank you.

Thank you everyone for joining us today I will begin today's call by providing an overview of our business performance. During the physical year 2000 planes. You. Then you will then provide a detailed overview of our financial year 2022 financials, highlighting the financial performance.

Each product category.

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Now I'll turn to slide six I'd like to briefly introduce our company for those who are new to our story well natural life as a bio ingredients solution provider in natural health and personal care industry.

So all my children from farms and process and break down the natural funds international chemicals that can be used commercially for the above mentioned application.

We have three product categories fragrance compounds health supplements and bioactive food ingredient fragrance.

Fragrance compounds are using fragrances that go into consumer fragrance oral care intrusion unacceptable help supplement our powder drink very valid and probiotics et cetera. So.

Food ingredients are using so please bear with us and help supplement as well.

Our customers include well known names in Asia, including Portland Home now and then Jim Brian and Angela eased. Our clients also include some of that that gets me in the U S and Europe that just international flavors and fragrances.

Chris.

Right bridal and Acs International.

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Okay.

Now turning to slide seven I'd like to briefly discuss our manufacturing facilities and that's coming through that plant.

We currently have two facilities in ziyang, China, both located within 90 minutes drive from the company's headquarter regarding our third production facility in that plant.

Any structure of the Brisbane facility have been completed or scheduled the first bush construction work and I've been made out to be completed in may this year part.

Part of the first phase.

And then Paul will increase the production capability of the fragrance compounds and bioactive ingredients to me the existing market and customer demand for.

The second phase of expansion the production will be used for the company's new proprietary products, including Nashville pre ordered and functional.

Oh Karen product.

The new construction is expected to increase our production capability.

Reagan compound and other food ingredients by 200%.

Representing a 115% annualized growth potential in our revenue.

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Hi.

In this slide I'd like to introduce the 10000 programs.

Briatore your products.

Do you have a tremendous and that gets a lot of efforts of our R&D team. We are excited and proud to be able to add new and innovative products to our nutraceutical line prophylaxis compounds business.

<unk> received initial purchase orders for our first female personal care product, but their appeal.

It is an all natural product with no antibiotics fragrance or harm for chemical episodic that's all harm for fighting back.

The part I cant regulate microbial balance of female reproductive system and cause.

Provide antibacterial and anti inflammatory function.

The exact other P orange or green approximately $3 million in revenue in the next two years.

Secondly, with like to introduce our new Broccoli base probiotic powder drink as our first proprietary product after the third of the vegetable base helped supplement theory.

He will provide an additional growth driver for us.

According to research about 56, Oh, I'm Chinese population are infected with H pylori, alright, a carrier that could cause digestive diseases.

Our new probiotic powder drink or potentially have that the proliferation of H pylori bacteria and regulate the microbial patterns of digestive system.

In addition to the powder drink, we're also expanding get above other consumer products, you know cruciferous basketball basic theory.

We plan to introduce immune system Blizzard in from gel capsule.

That helps bolster in softgel capsule weight loss management product.

A part of the middle aged and athlete.

We look forward to bringing our product to the market and we are optimistic about the opportunity and revenue potential of our proprietary customer partner.

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In slide nine other provide an overview of Oracle strategies for next six months to one year.

We're starting to put more effort in partner like infections in the fall.

All he accomplished introduced two to three new raw material category. He spent ourselves inc. How market and gain more competitive advantage it yeah.

In addition to that the company will continue to focus on the regulation technology of human micro organisms and developing new products are beneficial for digestive and immune health.

Presently we have tests that are well, along some product, including part of helping us.

So maybe a memory issue liver health and immune health.

Next in terms of capital markets and global operations. The company is expecting to carry out you're just doing mergers and acquisitions in the following year and these acquisitions will improve our capabilities in bio manufacturing technology and sales network expansion.

And the company will continue to look for opportunity to expand our business operation and local raw material market uncle, what level, especially in United States, Japan, Europe , and southeast Asia with a new Covid situation.

The company's strategy is to establish a localized business to rapidly expand their raw material business market. Meanwhile, The company will also anxiously engaged in global health solutions, especially in the U S and China.

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And I'm showing you the judge at all.

With that I will now turn the call over to Cindy and she will walk you through our financials.

Okay.

Thank you, Mr Hu, and Sydney, and Lindsay you that 2022 and your financials with you and our CFO Mr. Andy will be available for the Q&A session. If you have any questions regarding the financials.

Before I review the numbers, let me remind you that all figures I discuss here how far this reporting period. The year ended September 32022, unless I state otherwise. Additionally, any year over year comparison used to the September Becky <unk> 2021.

That's coal where our 2022 youre in good financial.

I'll begin with an overview of our consolidated results on slide 11 in the fiscal year of 2022 loans generally to the plc, maybe 29 point not meeting your revenue by 17, 3% increase over last year. These increases were primarily driven by the increase.

And how are we just starting price of all three product categories as well as increase himself wanting them all ballots chilled food ingredients.

Sunny prattville fragrance compound pull joking and balance to a floating rate in increased by 20 sounds like fun person sounds ascend and 17, 4%.

We list our sound impressive you respond to the Iraqis all material cost and market change that's affected by the COVID-19, and showing tangible principal realm of Chia will kill chewed up in normal weather.

Although the selling price was great. It sounds funny I'm about to food ingredients and how supplemental powdered drinks increased by 27.3% and 1% for the fiscal year 2022.

It sounds a lot of them are back.

That sounds food ingredients increment round, one vote in 'twenty 1000 kilograms.

How about a 154000 kilograms due to strong customer demand and our south, Texas, where it took almost L. O meal say, so extract the Spanish state to protect Lima, and lower blood sugar.

In addition, the sounds money almost fragrance compounds decreased.

15.1%, mainly due to the shortage of raw material, which suffered no more watch weather in the second half of 2021 along with disruption of logistics caused by COVID-19.

And the same time girls proceeds of that for the fiscal year are a tiny tiny itself was up healthy mainly non playing for a meeting increased by 32, 5%, which is mainly driven by strong can't wait goes from house supplemental powdered drinks and a biopsy a smoothing.

Gradient.

Sales volume and average selling price and moving in the right direction, partially offset by the supply chain impacted the country the ocean bound fragrance compound.

Don't Miss upset desk received in the form of a grant and recognized as other operating income totaled about 1.3, meaning and 450000 in the fiscal year up till now then 22 and 2021, respectively.

This is an example of continuing support from government high Tech companies like Boeing natural life.

Net income in fiscal year 2022 increased from 4.6 meeting to about six point she'll, meaning increased by 30, 514%.

Diluted earnings per share was 0.7 $4 compared to their upon six $8 for the same period in 2021.

Okay.

And Thats like I went down deeper into the financial performance of each board that cant great beginning with fragrance compounds then you'll generate shows from fragrance compounds increased by seven 6% from 12.7 meeting till about 13.7 meeting.

As I had mentioned previously that around new girls' self fragrance compounds with present really driven by the average order size and the allergist standing price snowball, we forget about.

Although there is a rise in the raw material cost due to supply chain and pandemic challenges with our advanced technologies and our ability to secure that supply we are able to increase our average selling price and mentioned our profitability in fragrance compounds.

Next our house, the Peanuts, specifically powder drink segment increased by 714% and six planes seven meaning to about a 7.1 meeting the increase from how supplement with many deal to automobiles and higher average selling price.

Yeah.

Revenue from Alcatel ingredients increased 48, 5% compared to the same periods of 2021 from fixed playing one meaning to about 9.1 meeting.

As I mentioned before the increase in revenue from balance still being Green, Dan was primarily due to volume growth and higher average selling price.

Overall, the increase in total sounds clever Neil from Union price increases in all three segments as well one of them increased inbound active ingredients and how supplemental apologize drinks.

That's not to impact supply chain shortage in fragrance compounds.

We are pleased with the overall financial performance of our project category.

Now turning to slide 13, I'll, let just they've got their rates no breakdown hours, south and the dynamics that influence our results.

The global supply chain challenges in 2022 remnant generates from domestic China was 28.8, meaning achieving a 21, 3% in crazy South which represents approximately 96, 1% of our total revenue for the fiscal year or two.

And then 'twenty two.

Oh, we're seeing south were up healthy maybe one pansil meeting representing about 329% of the total revenue Delta.

Still to come or 19 global logistics has been disrupted so have shifted ourself and a strategy that you ought to marsh Martin as far as to promote our projects through large domestic enterprise customers rather than export to overseas customers.

Believed that with the commissioning of human plant won't be able to accelerate the revenue growth in both domestic and international sectors to meet the increasing demand from our customers.

Next in Slide 14, I'll go over the key subsea Queensland after fiscal year 2022.

September 2022, the company has announced the delay of the commencement of human planned to May 2023.

January 2023 the company closed a private offering with gross proceeds of two poncho meeting many to Flonase meal, you find and working capital for the new production facility.

And now I'll turn the call over to Mr. Hu for closing remarks, and then we'll start the Q&A session well don't teenagers for it.

Hello, Tim.

Can you just.

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Okay.

In Sally one for joining us today before I wrap up today's presentation I would like to first recognize our employees for their efforts and thank our loyal customers for their trust in US we are confident that our R&D capabilities business model and strategy with April and to gain more market share in men.

And our girls momentum with that before we open to the call to a question I would like to note that for any question directed to manage money in China will translate both their questions and their answers he's going to ask you a question in Chinese. Please also ask in English for the benefits of listeners.

Also note that we'll only be able to respond to your question about our financial and they'll pay to adopt with that well now open the call to your question.

Peter.

Hum.

We will now begin the question and answer session.

To ask a question you May Press Star then one on your Touchtone phone.

If you are using a speakerphone please pick up your handset before pressing the keys.

To withdraw your question. Please press Star then two.

For those on the webcast you may submit questions by typing in the submit a question box on your screen.

At this time, we will pause momentarily to assemble our roster.

Yeah.

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Yeah.

And our first question comes from Emily <unk>, a private investor. Please go ahead.

Hi, Thanks for taking my questions I think my first question is for the CFO Richard <unk>.

I saw your press release that the company has postponed as a completion of the human coach Oh I. Just wanted to know do you expect it to a complete in may this here or there might be another delay and also how much production capability, whereas the classic Hawaii, there any existing demand for such increase or.

Do you have according to meet the increased production. Thanks.

Okay. Let me translate your question you can imagine.

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Human digital Guangdong.

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No that's it.

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Our digital culture.

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Can you talk about it with you at all.

Hi, there Oh, how many.

So it comes from the chairman and CEO Mr. Vishal.

So the management does not foresee any.

Further delay.

Special out there okay.

Okay.

Pre opening up two from the COVID-19 pandemic.

So they feel pretty confident that Joe.

There will be able to complete construction.

So we're ramping up production around may of this year.

In terms of our production capacity.

Phase one is basically for free.

Fragrance compounds in phase two is four.

Hum.

It could be ingredients food product.

So this one as we mentioned will come on come on right around May <unk>, which will bring additional capacity.

These 30 metric tons.

Fragrance compounds cats.

Which translates.

Into.

A 200% and tourism production capacity increased.

In terms of revenue will come to expect that we will increased by about 150%.

In terms of a.

Bio active ingredient products, which will come online.

In around May next year.

Please.

So that will bring an additional 300 metric tons production capacity to the company.

Yeah.

Yeah.

Yeah.

<unk>.

Alright, okay. Thanks.

I think my second question is also for for Richard Seale, I noticed like a coffee has overseas expansion plan, but can you explain why does the earnings and sales ratios, we always see decline in 2022 compare to the 'twenty 'twenty. One are will you adjust the planning the future or are you going to keep it flat.

Okay.

Let me translate question to Richard Hoagland.

Maybe.

How're you doing.

Sure.

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Chip and install a new one.

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[laughter].

So we're still going to wind up and we're trying to deal with it.

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It doesn't.

Tissue.

Oh gosh.

So the answer come from Michelle who became the chairman and CEO .

In terms of.

The overseas sales declined significantly in fiscal year 2022.

There's two reasons one is.

In March.

April and May of 2022.

Yes, there was a significant congestion at the port of Shanghai.

Which caused the company enabled us to deliver to the customer.

So that's affected one the second the second factor is that due.

Due to the supply chain disruption globally.

So a huge shortage of raw materials company needed for.

Fragrance compounds and also Sydney.

Bioactive ingredients.

Materials.

So those were.

One reason that the comedies overseas sales decline dramatically.

Dramatically because of IMO 2022.

Looking for the company does not foresee any of these factors will play their role.

So the company believes there will continue to see there was a company we only assume.

As for our business and.

The company does expect isn't going to see sales will pick up in fiscal year 2023.

Yeah.

Okay. Thanks.

And one more question my last question as far as the CFO .

I saw that the company's accounts receivable are or sex Neil is an increase by $1 3 million in 'twenty very true.

Okay. It's clear why the company has such a high level of Chicago receivables and do you have any bad debt provisions on that.

Okay. Thank you.

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Sorry, James.

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But they are not going to see a meal. So we'll have to go down.

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We thought it would be.

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Well a little cleaner shortly.

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Sure.

Sure she'd probably tell me you're in housekeeping and I'll go to the boxes that.

Well that was a little bit.

You can count on who to say R&D all of a sudden you airport travel shortly.

Okay Paul.

Hey, Andy so here's the answer from.

Mr. Liu the Companys CFO , so they changed the payment terms to come when you gave the customer is.

Universal three months or 90 days.

Throughout last year, the company has not experienced any.

Delinquent payments so all the payments are according to the payment schedule.

As of now.

In January of this year the company has pretty much connected all the balance that was reflected in our balance sheet as of September 32022.

So the company does not have any bad debt provision.

Okay.

Yeah.

Okay. Okay.

Alright, Thanks, I think I don't have any further questions on that.

Thank you Emily.

[laughter].

Yeah.

Once again, if you would like to ask a question. Please press Star then one.

Okay.

Yeah.

Yes.

Yeah.

This concludes our question and answer session I would like to turn the conference back over to Simon for any closing remarks.

Okay.

Thank you operator on behalf of a ball we want to thank you for your interest and participation in this call.

To speak with US further please contact Sophie or Maggie and contact information is at the end of the press release. Thank you.

Operator back to you.

The conference has now concluded. Thank you for attending today's presentation and you may now disconnect.

Oh.

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