Zane Yoshida: -for folks to join, Matthew.
Matthew Kowal: Sounds good.
Zane Yoshida: We will give it another minute or so, Matthew, before we kick off.
Matthew Kowal: That sounds fair. Got it just as 10. So we will say at three past or two past?
Zane Yoshida: Yeah, I think we've got folks joining us now. Let's kick off. Good morning, ladies and gentlemen. Welcome to The Calmer Co's Q1 FY27 Results Investor Webinar. My name is Zane Yoshida, founder and CEO of The Calmer Co, and we are also joined by Matthew Kowal, our Chief Commercial Officer. Apologies for the rescheduling of the webinar from Friday last week.
Zane Yoshida: Matt and I both returned from the US from a trade show that we were exhibiting at, and brought back with us a little bit of a bug. We are still soldiering on, but we did bring back some love from the United States. Let's keep going, Matt, and move to slide 2, please. This morning, we will be covering the strategic pillars and the progress thereof in Q1 FY27.
Zane Yoshida: I will speak to the quarterly highlights, the revenue performance as it relates to geography, channel, and product format breakdown, before Matt does a deep dive into the respective channel momentum across wholesale, B2B, retail broadening across Coles and Woolworths, and perhaps touch on next steps there in relation to the United States, before I come back in to talk about cash, costs, and funding, and some updates, given our involvement on the regulatory front with the regional work that we are participating in the kava industry.
Zane Yoshida: Thank you, Matt. When we communicate, we typically speak across four strategic pillars in the company. The first one being regional sourcing and innovation, the second one being direct consumer, including Amazon. The third one is profitable, scalable retail. Lastly, and certainly the exciting addition to the four pillars driving growth for The Calmer Co, our wholesale bulk ingredient.
Zane Yoshida: Starting with strategic pillar one, we have certainly made some very strong progress as it relates to the shift to broaden our supply beyond Fiji that we have communicated to the market about, to include Vanuatu and PNG. We are making very strong progress as it relates to the previous Kaiming binding heads of agreement and the transition of our manufacturing base to a new facility that is nearing completion, and certainly ahead of schedule in that regard.
Zane Yoshida: We have also been able to secure an inventory facility with Fiji Investment Corporation Limited, which is backed by the Fiji government, to support us with continuing inventory build, particularly with the accelerated growth that we anticipate coming from the wholesale channel.
Zane Yoshida: The Q1 progress across direct to consumer, including Amazon, and we previously communicated that we had brought the direct consumer back in-house, managing that transition from a sales force outsourced relationship with Acuity, and transitioning back to Shopify. We are certainly seeing very strong progress once again with our e-commerce direct consumer model, where we finished at circa AUD 636K for the quarter.
Zane Yoshida: Amazon contributing AUD 461K to that, as well as AUD 175K of that coming from direct consumer, which is our fijikava.com and .com.au websites. The third strategic pillar, profitable, scalable retail. We did grow quarter on quarter by 25%, very strong growth both across Woolworths as well as Coles, and contributing circa 40% of our revenue for Q1 FY27. Again, post Q1, we did make an announcement around the launch of our FZZR product formats, which is the first flavored kava formats to be launched in Australia.
Zane Yoshida: I think we launched those in circa 585 stores Australia-wide to start with. The fourth strategic pillar is wholesale bulk ingredients, and certainly, once again, we have made very strong progress with our wholesale, contributing 34% of revenue for Q1 FY27, which was up from AUD 305K from Q4 FY26.
Zane Yoshida: Again, given the strategic direction for the business and certainly moving beyond Australia into the United States in FY26, we can certainly see that 91% of that revenue for wholesale came from the United States, where there is very strong momentum right across the board, whether that be retail, online, or wholesale bulk ingredient formats. Thank you, Matt. The big call-outs for Q1 FY27 were we finished with a record quarter, up 42% on Q4 FY26 at AUD 2.44 million.
Zane Yoshida: Retail was up 25% quarter on quarter, and certainly the largest channel and contribution to group revenue at 40%. The wholesale and B2B revenue was up significantly from Q4 FY26 to AUD 832K, and again, with the bulk of that revenue coming from the United States. Australia revenue continued with a positive upward trajectory at circa 24% quarter on quarter growth, where Australia contributed to 49% of group revenue.
Zane Yoshida: So, record revenue certainly led by high-value wholesale and a broadening retail base. Net operating cash outflows improved by 6% to AUD 755K, and cash on hand at AUD 953K as at 30 September. We did complete an entitlements offer to the tune of AUD 1.2 million, and from Q2 FY26, we have access to an inventory financing capacity of AUD 250K from Fiji Investment Corporation Limited that I touched on earlier.
Zane Yoshida: We maintained inventory at AUD 1.5 million, largely supporting wholesale, B2B, and also building on retail demand as we enter FY27. Advertising and marketing OPEX spend was down a further 56% quarter on quarter, which came to AUD 112K and circa 5% of our total revenue for the quarter. Thank you, Matt. Again, very positive momentum driven largely by very strong retail performance in Australia, but also of our fastest-growing channel in wholesale and B2B.
Zane Yoshida: You can see that we were up 42% quarter on quarter to AUD 2.44 million for Q1 FY27, and really what is driving the result is the momentum with our CO2 and water extract formats. Retail, these numbers exclude the launch of FZZR, which commenced in Q2 FY27. So, very positive momentum across retail here in Australia.
Zane Yoshida: United States revenue was tied at AUD 1.2 million, or contributing to 49% of group revenue alongside Australia. Amazon USA, of course, contributed AUD 461K for the quarter. Thank you, Matt. Yeah, so like I touched on there, we are tied, and certainly from quarter to quarter, we see where the balance is as it relates to contribution of revenue from a geographic perspective.
Zane Yoshida: For Q1 FY27, certainly with the positive momentum at retail and, of course, with the positive momentum with the wholesale bulk ingredients channel, contribution on a geographic basis was split evenly at 49%, AUD 1.2 million respectively, where Fiji contributed to 2% of that, where we continue to sell our products at retailers and duty-free stores across the country with Prouds, Motibhai's, and Jack's of Fiji. Thank you, Matt.
Matthew Kowal: Cool.
Zane Yoshida: Matthew, over to you.
Matthew Kowal: I will pick it up from here, Dave. Just diving into, I guess, the channels and where we are seeing growth. It was a really positive quarter, but particularly when looking at retail and wholesale, both with growth, but in terms of some happenings that we are starting to see as well. Retail continues to show the strong growth, primarily driven by the establishment of a new pricing nationally, along with maintaining the sales rate, which is a really important factor. We have implemented that in late Q4 2026.
Matthew Kowal: What is really encouraging as well is looking at Woolworths, where we have just got a single SKU and therefore some future opportunities for growth, how quickly the 50 gram has performed and grown, as well as obviously Coles establishing a real leadership role within that stress category, which is allowing us to introduce new products such as FZZR.
Matthew Kowal: Wholesale, there are some really interesting elements coming out of the US, both with partners we already have, but obviously new partners we are looking to work with in and around some of the space that is happening with CBD and kratom, causing a lot more interest in the kava, particularly in that beverage manufacturing space, which is seeing the interest in the CO2 sales, as well as water extract as an alternative ingredient, or as a bulk kava consumption use at home, in that white label space.
Matthew Kowal: We continue to really look at both of those beverage space, as well as things like the kava bar and the white label as growth opportunities in wholesale. Lastly, e-commerce has really been stable with growth. We have made some comments obviously about the changeover with direct to consumer, which has already seen some significant step changes and encouraging numbers already into Q2.
Matthew Kowal: We are looking and expecting to put more time and effort into that, continue to grow it, but a really strong, consistent performance out of Amazon FBA, or Fulfilled by Amazon pathways, both in Australia and in the US, that shows some encouraging signs. Particularly some inroads into some of the larger categories over there, particularly with the traditional grind in the US.
Matthew Kowal: Talking about wholesale and then really sort of diving into what is sort of driving some of that. When we actually have a look at a split of where the value is coming from a format point of view, it is highlighted here with the growth of extracts. Kava powder is and will remain for some time the real core part of what our product split is.
Matthew Kowal: Due to the high value per kilogram of extracts, whether that is water right up to the CO2, 65% product that we have been selling, really makes a dramatic impact once we have locked down regular repurchasing customers in that ingredients wholesale space. I think the interesting element there is really broadening, and I will talk briefly a couple of slides later about what we are doing to build out that customer base, including a recent trip to SupplySide Global.
Matthew Kowal: Lastly, but importantly, I think from the RTD point of view, really putting some more energy into that in an Amazon space, allowing to make sure that we can push through our own products. I think what that does and what that indicates as well is the opportunity with partners that are looking to do more in the kava beverage space, meaning that if we can do either our own products or supply through to them, we are going to win on both fronts.
Matthew Kowal: Finally, the medicinal, we should see some impact a little bit more on that, as I said, FZZRs coming into play for Q2 results. Okay, talking to the extract market and basically the higher value, but also plays a significant part in basically the long-term development of the business. I think understanding the US market's increasing growth. For those that are not aware, there is a range of changes coming through in the CBD space, which is quite a large, sophisticated category over there, which is meaning there is likely a lot of restrictions into that space.
Matthew Kowal: What we are seeing is a lot of interest of people that have been working in that space. Traditionally, there is obviously edibles over there, but particularly into the beverage space where CBD has made some ground recently. There is a need to still supply to customers that are looking for a certain type of product, a certain type of experience, where kava is now very much being highlighted on those as a lot of the conversations that we are having.
Matthew Kowal: That, along with other ingredient players in the US having a little bit of uncertainty with regulators, and particularly kratom, leaves a real opportunity for kava over the next 6 to 12 months to grab a decent slice of that pie, both with manufacturers, flavor houses, but also moving down into the consumer front as well as people start to recognize the benefits of kava in their everyday consumption.
Matthew Kowal: As I mentioned before, a key part of taking advantage of this is going to be about ensuring we broaden our base of customers or partners when we come to this, and therefore making sure we are getting on the right order cycles. That is why we are investing a lot of time in terms of the sales contact side, new business development.
Matthew Kowal: One particular activity we just came back from that Zane mentioned at the start was SupplySide Global, probably one of, if not the key ingredients show in the US, where we saw directly on stand with a lot of people coming to us, but also in terms of pre-show organized meetings, a real hunger to know about and tap into the supply that we have with kava, with a range of levels.
Matthew Kowal: Whether it is from people looking to do some extraction themselves into their own products, whether it is looking for people to provide the high value extracts that we have got instantly to blend in, the whole market is lifting. As I said, being one of the few, if not the only supplier that can do across the board in those supply chains, with all the sophistication that is expected in that food and beverage element and quality, leaves us in a good space to build these partnerships and, as I said, start to deliver more and more in the wholesale space.
Matthew Kowal: Finally, but definitely not by least, is the retail growth. I think we have touched on before the effort that has gone into building this and where we have positioned ourselves in that stress category, particularly in Coles. We are really starting to see the long-term benefits to be able to identify new space on shelf, be able to identify new customers to try to bring through in different formats with FZZR, which now then leaves us as the predominant kava brand in retail.
Matthew Kowal: I think especially when we are talking about an Australian market, given the Coles and Woolworths coverage of 67%, we have now positioned Fiji Kava as the brand in kava. Now, opportunity to keep growing that across Woolworths, but also establish these new formats, comes into obviously a very busy competitive space.
Matthew Kowal: Insight into both Coles and Woolworths have different strategies towards how they take on the likes of Chemist Warehouse, and working with them accordingly to make sure that the products and also the positioning that we have allow us to keep growing into that space, and keep bringing more people into kava consumption, whether it is bought through Coles, Woolies, or eventually direct from us or on Amazon.
Matthew Kowal: What I think we are getting out of this, and a really important step is where we take these learnings and how we execute that in other retail spaces, and I think particularly the opportunity in the US. We have taken some really positive steps this quarter in terms of that road to retail in the US, making sure that we are doing it correctly, but working with a great sales broker partner with VDriven.
Matthew Kowal: We have already established and met with one major chain that is very aligned to the product and also what we want to do with a view to obviously gain ranging in the near future. What that is going to allow us to do is really create that proof point in retail in the US, which is really important, which then allows us to feed off that to create more distribution, more sales success.
Matthew Kowal: I think for retail and Q2, coming into what is a challenging time for non-Christmas goods, very busy, very competitive, and I am sure we are all very excited to see the Christmas decorations already up around town, just to make it realize how quickly this year is going. What that means from a retail point of view is very lean management on what they do outside of those core big movers, whether it is the turkeys, the drinks, and the like.
Matthew Kowal: Part of the pricing has been to be able to give it the power to really put a strong promotional program through to allow that pull to maintain through Q2 as well. We are in an exciting position with FZZR now on shelf, and I invite you all to get out there and grab some from Coles, and setting ourselves up also for the opportunity in the US. I think that is over to you, Zach.
Zane Yoshida: Yeah. Thanks, Matt. Cash costs and funding, certainly we have strengthened the balance sheet and disciplined further with our spend. AUD 953K cash on hand as at 30 September. Cash receipts from customers were at AUD 1.79 million for the quarter. Prepaid inventory, or total inventory, including prepaid, totaled AUD 1.5 million, with net operating cash outflows down circa 6%.
Zane Yoshida: Advertising and marketing spend was down a further 56% quarter on quarter to AUD 112K, but we can continue to see the positive momentum as it relates to direct consumer, as well as retail, with reduced ad spend, which is a good sign that there is certainly more awareness of the Fiji Kava and Taki Mai brands, respectively, but also on Amazon USA as well. We also announced the cost savings as it relates to staff costs from FY25 to FY26 at circa AUD 700K.
Zane Yoshida: We have continued to reduce staff costs, and we concluded Q1 FY27 at AUD 324K versus AUD 351K for Q4 FY26. The key highlights for balance sheet really were around the AUD 1.2 million cap raise that we completed via the rights issue entitlements offer in the quarter. The placement of the remaining entitlement offer and shortfall continues to progress this month. We have had positive news with the inventory financing facility from Fiji Investment Corporation Limited, which is available to us from Q2 FY27.
Zane Yoshida: Again, this is a positive development in Fiji, particularly with this fund mandated by the Fiji government to support companies like ourselves focused on export markets. Certainly, we are looking at additional working capital funding to support the positive momentum as it relates to our wholesale growth. Thank you, Matt.
Zane Yoshida: Something that we have been very heavily involved with is the regulatory front, and the importance of the regulatory front. I have spoken to the importance of building a strong foundation to scale from, to ensure that we have a quality framework to meet international food safety standards as a minimum. In 2024, the Pacific heads of government committed to what is called a Regional Kava Development Strategy. Since then, DFAT, through Standards Australia, have committed to developing a regional standard for kava.
Zane Yoshida: What that means is the growing, the processing, and subsequent export of noble kava will need to meet food safety standards. We have a position as part of the technical committee with the development of that standard. That standard is for kava when mixed with water in its traditional format, but also in parallel to that, we are also developing a standard for kava extracts.
Zane Yoshida: Certainly, the hope is, given the international recognition of kava when mixed with water in its traditional format, having had Codex Alimentarius or the World Health Organization and Food and Agriculture Organization endorse a regional standard in that regard, what we are looking to do is broaden that to bring more science into the development of that standard versus using traditional knowledge on the identification of what is noble cultivars versus non-noble cultivars or wild kava varieties, and looking at that from the scientific lens.
Zane Yoshida: What we are looking to do is also broaden with the traditional formats allowable under Codex Alimentarius to include kava extracts as well, given the very strong positive momentum that we are seeing as an industry for demand for extract or bulk wholesale formats into the United States in particular.
Zane Yoshida: I guess the importance with that is the Codex Alimentarius framework have quad member oversight and participation through the United States, Canada, Australia, and New Zealand. Again, the position with the kava status in Australia is a dual pathway. We sell our kava powders, for instance, regulated under FSANZ Food Standard Australia and New Zealand Standard 2.6.3, but the limiting factor with the FSANZ position and regulation of kava is, it is for our traditional formats or our drinking kava formats or powders when mixed with water.
Zane Yoshida: Beyond that, the FZZR, for example, where we have a standardized dose of the active constituents kavalactones, is regulated by the Therapeutic Goods Administration as a complementary medicine. What that simply means is the production of those two products need to be made in a food-compliant facility versus a pharmaceutical facility, that being the major difference.
Zane Yoshida: Of course, the quality that is required as a complementary medicine versus a food, specifications differ as well. In the United States, kava when mixed with water is broadly recognized as a food, or kava when steeped with water, as they call it. Certainly, states like Hawaii have recently recognized kava as GRAS, which means generally recognized as safe, or translating into simple terms, recognized as a food.
Zane Yoshida: Certainly, with the regional kava standards and the work that we are contributing towards, we are hoping that we can broaden the recognition of kava beyond traditional formats to include extracts as well, given the United States participation with Codex Alimentarius particularly as one of the key quad member countries as their core.
Zane Yoshida: That relates to the FDA modernization that is underway. Earlier this year, we had the opportunity to present to the FDA and update the FDA on the work that is being done right across the Pacific, particularly as it relates to broadening the scope beyond traditional kava formats recognized as a food.
Zane Yoshida: So, with the international framework, there is an organization in the Pacific called Pacific Islands Forum Secretariat, or PIFS, who continue to work on market access into the European Union and have submitted a novel food application in that regard, to be followed by further tests of kava confirming nobility right across the Pacific to be able to re-enter the European Union, which is a significant opportunity, as well as working on re-entry into the UK, potentially with a pilot program similar to what we have in Australia.
Zane Yoshida: The Codex alignment work, like I touched on, is very important. But again, the work that PIFS continue to do around market access also includes what is called geographical indication, or GI, to protect kava as being unique to the South Pacific. Similarly, for instance, you may have heard of wine from champagne or grapes coming from the champagne, not wine, champagne, sorry, coming from the region of France.
Zane Yoshida: That is certainly a direct comparison to geographical indication and the importance of provenance and connecting that product or that commodity from that particular region. Like I touched on, the EU and UK access is in progress based on work that the Pacific Islands Forum Secretariat continue to make. And why this is important for The Calmer Co is beyond traditional formats.
Zane Yoshida: We recognize through what is called a declaration from the Pacific, where the heads of government recognize kava as being truly unique of traditional and cultural significance to the region, but also recognizing the importance of value-add extracts, for example. Based on that declaration, we have been mandated through Standards Australia to develop a broader standard with a scientific lens to see how we can broaden market access in the United States, in European Union, as well as into the UK.
Zane Yoshida: So, it makes for a more enabling regulatory environment, but also broadening distribution options for kava and kava-derived ingredients, which supports retail, wholesale, and B2B extract strategies. Thank you, Matt.
Zane Yoshida: As we look ahead into Q2 FY27, certainly the strategic priorities for the team are continuing to scale wholesale and B2B, converting the growing pipeline into recurring orders across standardized extracts and ingredient formats, build on the retail momentum with the launch of FZZR in Q2 FY27, establishing a US retail footprint that Matt spoke about earlier on, and working towards progress towards cash flow break-even.
Zane Yoshida: Like I touched on, certainly we are seeing a lot of momentum come from the USA ahead of what is called the Farm Bill review on 11 December, where we are seeing a lot of products already in the market that have been formulated with CBD or THC, for instance, looking at kava as an option alongside THC, if not as a replacement to these ingredients for products that are already in the market.
Zane Yoshida: That is what is driving a lot of positive momentum on the wholesale extract format front in particular. Also based on the fact that Gen Zs, as we have communicated previously, continue to shy away from alcohol and looking at kava as a natural, healthy alternative to alcohol. Certainly, like we have communicated previously, being at the right place at the right time is very important.
Zane Yoshida: Certainly, we are seeing that with the positive momentum and increased revenue across all our channels with the Q1 FY27 results. Thank you, Matt. Like I touched on, we are up 42% quarter on quarter. This, for us, is the strategy and the strategic direction for us across the four strategic pillars are very important.
Zane Yoshida: But beyond that, the geographic spread now having demonstrated that quarter on quarter with demand out of the United States, and given our successes with retail Australia and the learnings thereof, taking some of those lessons, particularly with our presence on Amazon USA, into that thinking in terms of product format, in terms of pricing and positioning, as we look to enter retail USA with our next steps.
Zane Yoshida: Thanks, Matthew. I guess, beyond the questions that we have received, and we have three questions that have come through, Matthew. The first one I will leave with you, and if I can read that out, it says, excuse me, "I noticed the FZZRs are not available to purchase online. Are these coming soon? How about a promotion on a Christmas bundle? Maybe a pack of FZZR, excuse me, 150-gram sachet of instant and a six-pack of Taki Mai. Good way for people to refer their friends and family by giving them the gift of calm at Christmas.
Matthew Kowal: Well, lovely idea. And yes, they will be coming onto an online format. We are just going through that early stage process with Coles that, in short, we want to make sure we have enough inventory. It is really hard to judge rate of sale on a new product, not only a new product to us, but it is a new product to the category.
Matthew Kowal: So, while there is a little bit of uncertainty on what that initial rate of sale is, and obviously just making sure our supply chain, which is a lot longer, given some of the complications involved with making the product, and the TGA-registered product.
Matthew Kowal: We are just ensuring that that pipeline is supported, because Coles is a key partner, and obviously a key volume mover for revenue-wise. As soon as that is shored up, and I imagine we should get a good view on that in the next two to three weeks, we hope to have some online formats in time for a very calm Christmas.
Zane Yoshida: Beyond that, I guess, maybe speak to some of the flavors that we are thinking about. I mean, we launched with a pina colada or pineapple coconut flavor, Dave, but certainly there is opportunity to broaden that as well with the reformulation into the US and beyond.
Matthew Kowal: No, absolutely. We want to look at the extended sort of opportunity with FZZR, because that, I guess, is the question as a starting point. Once we have established the key channels, the adoption, obviously in Australia, first of all, is then obviously looking at obviously additional SKU ranging with different partners or direct online.
Matthew Kowal: We have already started the development of two or three other flavors in a similar delicious fruity vibe, mojito or a lime mint being one, as well as a few others that include everything from blue lemonade to some of the more sort of exciting ones. We are obviously going through the process to test those to see which are best for market. I guess the other big step, and this is very much tied to our retail strategy over in the US, as well as online, is developing a US-ready product for them.
Matthew Kowal: As you can imagine, there are some different opportunities in terms of ingredient formats that we can put into the FZZR, as well as a few other sort of details on the size of tablets as well that we get to play around with a little bit more freely over in the US. But most of all, making sure we get the flavor and flavor profile right.
Matthew Kowal: Generally, a slightly different palette over there, but we have got sort of big plans both in retail as well as Amazon over there to see the FZZR, which got a lot of feedback and sort of internally as well, kind of started to take that pop candy type vibe where a good majority of people are using the FZZR to really go straight into the mouth and using the fizzing as a little bit of fun and taste experience, as well as the actual calming benefit that comes after that tabletable consumption. So, exciting.
Zane Yoshida: Thank you. The second one is probably a question for me, concerned about cap raise considering current share price and volume of shares listed. Please advise strategy around funding for growth and reinvigorating the share price. As we have touched on, we did complete an entitlements offer in the quarter. We have a shortfall to place, which concludes on 27 November.
Zane Yoshida: We are certainly working towards that to ensure we close the shortfall. The share price is unlikely to move in any significant direction until such time as we complete the shortfall. The third question was around what would dramatically surge share price on the ASX, a reliable supply, overseas retail involvement, Coles, nationwide rollout.
Zane Yoshida: Again, tied to the question prior, it is really tied to the completion of our shortfall, which we conclude at the end of November, but also continuing with the positive momentum and performance towards cash flow break-even. Certainly, the good news ahead as it relates to broadening wholesale, continuing the positive momentum with Australian retail, and online in the business, as we move towards break-even, is very important with any positive momentum with share price on the ASX as well.
Zane Yoshida: Thank you. I think given we have some time still, Matt, perhaps let us talk about SupplySide Global. We exhibited there last year for the first time, and the costs for that exhibition were covered by the European Union through ITC specifically, or International Trade Centre. Similarly, this year, they covered a portion of those costs for our travel into the US.
Zane Yoshida: What was different in your mind versus last year with SupplySide Global? Remembering that this is the largest ingredient show globally that takes place annually at the Mandalay Bay in Las Vegas. I mean, certainly from the amount of traffic that we saw this year versus last year, the maturity of the questions around kava versus discovery questions last year, for me, were really the big differences there.
Zane Yoshida: I think a lot of the inquiries came to us from the nervousness around the Farm Bill or the hemp bill that is looking to be finalized by the US FDA on 11 December. A lot of formulators, a lot of contract manufacturers are anxious looking ahead at 11 December. Those top of mind were the key differences for me with the quality of the contacts that have come through and the inquiries of contacts with wholesale bulk ingredient formats. Your thoughts?
Matthew Kowal: No, absolutely. I think it really moved from being quite heavily educational last year on what is kava, quite a lot of fresh faces across a lot of the conversations, to this year being how can it fill a gap in my revenue chain. A lot of it, as you said, comes from Farm Bill and other restrictions and movements in other ingredients.
Matthew Kowal: There was also, I think, a natural inclusion with the growth of things like calming RTDs, alternatives to alcohol options, has probably broken over from what was, I would not call it niche, but more specialized channels to something that was starting to hit main markets. You start talking about retailers having conversation with the non-alc functional drinks, such as Target and the likes, means that it has really taken that step into the mainstream.
Matthew Kowal: The effect of that gets felt downstream, and as you said, from formulators through even distributors, even understanding where we are looking at in those co-man that have a foot in their own product as well as other people's products, making sure they can provide the service and the ingredients.
Matthew Kowal: There was a level of people were searching out kava rather than stumbling upon the year before. No, it was really refreshing to see, and we had really good questions coming through with the inquiries about that real functional type of use and in the different forms of goods or CPGs a lot of people were looking to use them for.
Matthew Kowal: I think overall in the market, the interest in kava has really significantly jumped, and now it is a matter of people really going through the process of what is that commercialization step, and therefore, how can we support them in that, as I said, depending on the format that they are looking for or the tools that they already have from the industry they have been working in.
Zane Yoshida: Yeah. I guess something that I did not really touch on the regulatory front is the positive momentum with the Fiji government and the Fiji Kava Bill, or as it is called in Fiji, the Yaqona Bill. There has been two reviews in parliament already this year. The Fiji government have just finished their stakeholder consultation, their third stakeholder consultation in the country, and the bill is to be debated for the third time in parliament, I believe, next week.
Zane Yoshida: Just for everyone's awareness, what this means is that through the Kava Bill, the Fiji government will look to establish a council or a Yaqona Council, which will be represented by growers, by exporters, by manufacturers, and also through participation with the Ministry of Agriculture, Ministry of Health, Biosecurity, to finally regulate the industry to ensure that we have compliance to food safety standards.
Zane Yoshida: This is very important for businesses like The Calmer Co, who have been swimming between the flags, so to speak, from a compliance perspective for so many years. What this will ensure is consumer safety will be first and foremost. There will be some consolidation in the industry with the number of exporters who are currently exporting without having to meet any formal qualification or testing requirements.
Zane Yoshida: For example, which will certainly be significantly beneficial to The Calmer Co., given our registration with the FDA, given our audit with the FDA, also given our HACCP Australia accreditation certification, and our new move towards CGMP compliance as well as a manufacturer, and with the next steps in transitioning to our partnership with Kaiming Agro Processing in December, or next month.
Zane Yoshida: Beyond that, Dave, is there anything else with store visits, for instance, in the United States with product formats? Certainly with the positioning of FZZRs as a retail offering, our success of our drinking kava formats, our instant kava formats, we haven't seen anything like that available in the store visits last week in the United States. What are your thoughts there in terms of-
Matthew Kowal: Encouraging blend of-
Zane Yoshida: -brand value?
Matthew Kowal: Yeah, look, I think encouraging blend of a lot of the big main natural grocery, as they call it there, had a presence of kava, more in those traditional medicinal formats of capsules and tinctures, showing that there is an awareness and interest in the ingredient. Only a few had moved into the next innovative type of products or understanding the value of the bulk instant kava as we are seeing here in Australia. I think that knowing what we are seeing off Amazon and the breadth and volume of the interest, as well as in the opportunity that is going to come over these next six months with a lot of new products we already know that are coming to market through some of the people we supply.
Matthew Kowal: The retail space is a huge opportunity, and I think taking the learnings that we have got from Australia and really executing them well, making sure that we have got a real clear focus, hence, we have got, and we spoke to, conversations with some real strategic type retailers where we can see the growth opportunity, can leave us in a really good position to not only execute that well, but then rinse and repeat.
Zane Yoshida: Yeah, absolutely. Absolutely. Okay. I do not think we have any more questions that have come through, Matthew, so we might conclude there. Thank you folks for your attendance. Again, if you did have any further questions for me or the team, please email me on investors@thecalmerco.com. Thank you so much.
Matthew Kowal: Sounds good. Take care, everyone.
