DaBomb reported a net loss of NT$1.04 per share for the first three quarters, but is expected to turn a profit in the fourth quarter.

DaBomb (6578) reported a net loss of NT$1.04 per share for the first three quarters. However, the company’s core business has improved significantly due to the increased sales proportion of high-priced and high-margin products. The Tainan plant has turned a profit, and the Zhangzhou plant will not incur any further losses after recognizing one-off expenses related to the shutdown. Therefore, it may be profitable in the fourth quarter.

Chairwoman Liu Yu-fen stated that DaBomb is actively transforming itself, utilizing post-biotic immune-enhancing technology to develop high-value-added new products, and expanding its CDMO business to assist clients in developing differentiated products. With the completion of the first phase of the 20KL fermentation production line expansion at the technology plant in the second quarter of next year, customer demand will be immediately met, and economies of scale will become apparent in the third quarter of next year.

DaBomb , whose operations are gradually improving, reported third-quarter revenue of NT$87.05 million, roughly the same as the same period last year; operating loss was NT$12.17 million, a year-on-year decrease of 11.93%, with a net loss per share of NT$0.53. Cumulative revenue for the first three quarters was NT$283 million, a year-on-year decrease of 10.92%; operating loss was NT$34.93 million, a year-on-year decrease of 35.23%, with core business losses narrowing, and a net loss per share of NT$1.04.

Originally focused on the export market, DaBomb has shifted its global supply chain strategy after the pandemic, making Taiwan a key production base. The Tainan Science Park plant, the production center, accounts for over 90% of sales and revenue. The transformation is gradually taking effect, with revenue in the first three quarters exceeding that of the same period last year, and gross profit surging by 197%. The company returned to profitability in the third quarter, offsetting losses from the first half of the year, and has now achieved profitability for the first three quarters.

In addition, the Zhangzhou plant in Fujian Province has been severely impacted by the African swine fever outbreak in mainland China in recent years, becoming a major cause of operating losses. As part of the company's transformation strategy, the Zhangzhou plant completed its phased tasks and ceased operations in the third quarter of this year, resulting in asset impairment recognized in the third quarter. This led to an increase in after-tax losses to NT$29.56 million in the third quarter, but further losses are not expected in the future. With the Tainan plant returning to profitability, profits are expected to turn positive in the fourth quarter.

DaBomb stated that its DBT-100 series is an antibiotic alternative product consisting of immune-enhancing postbiotics and antibacterial probiotics. It has already completed import registration in the Philippines and is in the process of import registration in Vietnam, Malaysia, the Philippines, South Korea, and other countries. Customers in various countries are conducting tests, and negotiations with distributors are underway. As more feed additive import permits are obtained from various countries, shipments are expected to jump month by month starting in the fourth quarter.

In addition, we have received orders from a large US global marketing international animal health and nutrition strategy company, a US-based feed additive developer, and a domestic enzyme R&D and design company. We will also be collaborating with a Vietnamese aquatic feed customer and a Singaporean startup that possesses novel antibacterial active ingredient (Yuetai) technology. Furthermore, we are developing pet flavoring additive products for Malaysian feed customers.

The above content is excerpted from a news release by Du Huirong in the Commercial Times on November 3, 2023.
https://www.ctee.com.tw/news/20231103700749-430504