International customers favor DaBomb with gross margins rising quarter by quarter.

DaBomb(6578)Today (28th), the company stated that in recent years, it has adjusted its order structure and increased shipments of high value-added products. In the first quarter of this year, the company's revenue was NT$99.32 million, and the gross profit increased by nearly 5 times to NT$4.4 million. The gross profit margin was 4.43%, which was 3.79 percentage points higher than the same period last year. The company's strategy of optimizing its product portfolio has gradually taken effect.

DaBomb held its shareholders' meeting today, during which it approved the 2022 annual report, financial statements, and loss compensation plan, and passed a resolution to distribute cash from capital reserves at NT$0.66 per share. The meeting also saw the complete re-election of all directors and independent directors. Following the shareholders' meeting, a board meeting was held to elect a new chairman, with Liu Yufen re-elected.

DaBomb uses microbial integration engineering as its core technology to develop products that are antibiotic-free, food-safe, and health-sustainable. In addition to continuously optimizing the production process of its main product, hydrolyzed soybean peptide protein, it has launched high-value-added products such as probiotics and enzymes in recent years. Despite the impact of the COVID-19 pandemic and the Russia-Ukraine war on the livestock industry, DaBomb revenue in 2022 was NT$434 million, only slightly lower than the previous year by 7.86%. Although it still incurred a net loss of NT$44.66 million after tax, this represented a 28.48% reduction in losses compared to the previous year.

It's worth noting that the company adjusted its order structure, increasing shipments of high-value-added products. After the gross profit margin turned positive at 0.64% in the first quarter of 2022, it rose quarter by quarter, reaching 8.35% in the fourth quarter. Revenue in the first quarter of this year was NT$99.32 million, lower than the same period last year, but gross profit increased nearly fivefold to NT$4.4 million, with a gross profit margin of 4.43%, an increase of 3.79 percentage points compared to the same period last year. The company's strategy of optimizing its product mix is gradually taking effect.

Liu Yu-fen stated that the company boasts strong R&D capabilities and possesses globally leading lactic acid bacteria fermentation technology. It has achieved triple certification from the EU's highest standards: HACCP, ISO22000, and FAMI-QS. Its products are marketed worldwide, collaborating with major distributors and agents in Asian countries such as mainland China, Japan, South Korea, the Philippines, Thailand, Vietnam, and Malaysia to sell peptide proteins, enzymes, and other products. Earlier this month, the Tainan factory passed a factory inspection by a large US-based global marketing and animal health and nutrition strategy company, indicating continued growth in shipments of high-margin enzyme products. Liu Yu-fen stated that this client focuses on developing and selling animal health products with high market demand, such as enzymes and amino acids, covering poultry, pigs, cattle, and aquatic products. She anticipates further cooperation between DaBomb and this client in the future.

Kuo-Huan Enterprise Group, one of DaBomb 's original shareholders, participated in DaBomb first private placement of common stock this year, becoming DaBomb largest single shareholder. Kuo-Huan Enterprise Group is Taiwan's largest animal product distributor with a complete distribution network in Taiwan. Its strategic alliance with DaBomb will help increase DaBomb domestic sales and penetration rate. DaBomb is developing poultry products, and leveraging Kuo-Huan Enterprise Group's distribution channels will accelerate its expansion in the domestic market.

Due to the expiration of the board's term, the shareholders' meeting today also completed a comprehensive re-election of the board. Seven directors were elected (including four independent directors), including representatives of Jiaying Investment Co., Ltd.: Liu Yufen, Guohuan Enterprise Co., Ltd., and Guojing Enterprise Co., Ltd., as well as independent directors Huang Huawai, Zhang Yongfu, Zhang Zhi, and Xu Libing. Their terms of office are three years, from the date of their election at this shareholders' meeting until June 27, 2026. Immediately after the shareholders' meeting, a board meeting was held to elect a chairman. All attending directors unanimously elected Liu Yufen to continue as chairman.

The above content is excerpted from the Economic Daily News, June 28, 2023, by reporter Xie Baihong.
https://money.udn.com/money/story/5612/7264823