Whilst medicinal cannabis might be all the rage currently, there is no shortage of other natural medicines.
Kava is a plant native to the western Pacific islands and has been used in ceremonial drinks for centuries. The plant promotes relaxation thanks to kavapyrones, a substance that acts similar to alcohol in the brain, which has a calming, relaxing effect on the body. Aside from its ceremonial properties, the plant has been used to treat pain and seizures.
FijiKava (ASX: FIJ) is a medicinal Kava company producing the plant for the natural medicine market. Recognised as a complementary medicine in Australia, the Company’s Kava is produced under Good Manufacturing Practices which are both TGA and FDA approved.
The Company has generated a record revenue result for the quarter of $420,000, an increase of 150% on the prior corresponding period.
Increased production as well as new product development saw a rise in cash outflows and operating costs by 8% to $1.6m. Amongst these new products are Kava Teas for sleep, mood and wellness as well as ‘Noble Focus’- a supplement designed to improve concentration and academic performance.
In an effort to increase the profile of Kava products, the Company has put their products on the shelves of Coles and Chemist Warehouse. Both retailers showed record sales in September. The strategic partnership with Chemist Warehouse was established during the quarter and is valued at $1.43m over three years for comprehensive distribution across the country.
Further abroad, the Company received their first commercial order to the US. The Company appointed Network Nutrition as “exclusive Speciality Ingredient Partner” in the US for sales.
The Company also ramped up marketing efforts, buying a radio advertising spot in Sydney and Melbourne via KIISFM. The advertising deal includes mentions on the Kyle and Jackie O show.
Extending beyond radio advertising, FijiKava has engaged Publicis Groupe, an ad agency that will create two campaigns over the coming year- the ‘Calm Your Karen’ and ‘Calmbassadors’ campaigns. The campaigns are designed to increase public awareness of Kava and hopefully move product.
CEO of FijiKava, Dr Anthony Noble said: ”I am very pleased with the performance of FijiKava during my first full quarter as CEO. We have recorded another record quarterly revenue result, We enter Q2 with growing sales momentum and are now taking bold steps to increase our brand reach through marketing initiatives and trade spend aligned with our existing sales channels.”
“As we pursue further revenue growth, we know that revenues may continue to fluctuate especially as we enter into new agreements, however, we remain confident in achieving sustained growth over the medium to long term.
“The announcement of the strategic partnership with Chemist Warehouse cements a critical channel for consumers to access our products, via Australia’s largest pharmacy retailer.”
Samantha Freidin is a business journalist at Emerald Financial whilst also completing a Masters of Marketing and Digital Communications at Monash University.
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