Biome Australia Limited (BIO) Earnings Call Transcript & Summary

Good morning. My name is Blair Brabin Norfolk, the Founder and Managing Director of Biome Australia and our brands, Activated Probiotics and Activated Therapeutics. Thank you all for joining this morning to hear about our Q1 FY '26 results. There was overwhelming request for another webinar. We had a very successful webinar that was very well attended only a couple of months ago, and after a stellar quarter, we thought it would be a perfect time to jump back on, give everyone a bit of an update on the most incredible record breaking quarter that has just passed and give everyone an opportunity to ask some questions. So with that in mind, with the 30 to 40 minutes we have scheduled, I'll only use 15 to 20 minutes for the background on the company and the presentation of Q1, then be very pleased to jump in with some questions. Happy to answer anything. If I can't answer it, I'll pass it along to the team, but I'm sure we can probably get through most things. With that in mind, please send any questions through the chat below in the Zoom screen. If you're unable to do so, feel free to send through any questions to support@activated.co, and we'll do our best to get to everything. I think last webinar, we had about 35, 40 questions we got through. So we'll do our best to get to them all. And with that in mind, let's jump in. So a very quick background on who Biome Australia is. So Biome Australia is an innovator in the health care space. We focus on clinically proven preventative medicines and microbiome-based therapeutics. Our products are primarily probiotics or targeted live bacteria products. In doing so, what we've done is really developed a new type of medicine looking at unique strains of bacteria, identifying their mechanism of action, how those trends work and then applying them through human clinical trials on all sorts of health conditions and diseases with really credible statistically significant outcomes. Biome took on this mission, founded back in 2018, with the idea to be able to create a new type of preventative medicine for health care professionals to be able to use in their clinical practice, a meaningful set of products that will significantly improve patient health outcomes and provide a new opportunity for pharmacists in Australia and practitioners in clinic to be able to add a new set of tools to their toolkit for various conditions that we work within. So obviously, we're an ASX-listed company. We listed on the ASX in November 2021. It's been an incredible journey learning how to work with the ASX, retail investors, institutional investors more recently over the last year or 2 and our growth journey as a brand out in the trade has really mimicked our growth and success as a public company as well. And with the support of our investors of all types, I'm really pleased to sort of give you a bit of an update and some exciting plans and strategies on what we will be continuing to work on through the rest of FY '26. So Biome's mission, it's a very holistic mission. We are absolutely the impact company within health care in Australia. We aim to improve patient health outcomes, prevent disease and improve quality of life as a result. It's also important as well as a professional brand, sometimes it can be harder to access the products. We do make them accessible, not via Amazon stores, but by making sure that they are available through health retail outlets around Australia. We are in now the more than 6,000 outlets in Australia between integrated health clinics, pharmacies and health foods shops. So the hero of what Biome does is our Activated Probiotics. And these are world-first novel therapeutics or probiotic products that have been developed off the back of human clinical trials. So that is gold standard research, randomized, placebo-controlled, double-blind clinical trials on conditions such as depression, osteoporosis prevention, dermatological conditions such as eczema and acne. We work in cholesterol reduction. We have an incredible product Biome Cholesterol here, the one in red, that has 5 published clinical trials showing it significantly reduces LDL-cholesterol while maintaining HDL-cholesterol levels, supporting patients either on oral statins being able to used as an adjunct. We work in female health, vaginal health. We work in gut health alongside many other probiotic brands with really strong product for irritable bowel syndrome, daily digestive issues, immune health, oral health, muscle recovery, probably one of the most important thing, children and also allergies such as asthma. Biome's journey as one of the world's first or world's leaders when it comes to clinically proven probiotics, all started with the journey in a clinical trial in pediatric allergic asthma. I'm not going to go into the background too much today because I think many of you are familiar with the story. But just a quick background, Biome Breathe, the one in green at the bottom here, this is subject of a large clinical trial in 440 children with pediatric allergic asthma. Over 6-month trial versus placebo, this product was able to reduce the instances of asthma attacks or asthma events, wheezing episodes by 64%. For Biome, that really was the entry to our journey down the clinical trial pathway and really wanting to be a leader in discovery of new strains of bacteria and new applications of probiotic strains to be able to support patients well beyond gastrointestinal health. We also have an incredible micro encapsulation technology, which is quite important as well from an efficacy standpoint. So even when you're looking at our more mainstream products for gut health, we made sure that we protect the viability of our product to ensure that they're significantly more effective than other products on the market. Essentially, the problem that we're trying to solve is bacteria are a living microorganism. One of the biggest challenge is getting them through the digestive tract to the large intestine intact and viable, and so that can then interact with the immune system, reduce inflammation and do all the wonderful things that probiotics have been proven to do for human health. So with our microencapsulation technology, it's a plant derived lipid. It is sprayed on the microscopic bacteria. And in several clinical trials, it's been proven that 5x more of our probiotics survive getting to the large intestine than uncoated probiotics, the other probiotics in the market. So on the most basic level, there's an efficacy and a quality advantage on our more mainstream products, but then we are the industry leader when it comes to condition-specific and clinically proven products. So some business highlights from Q1. We had a lot of e-mails from investors from the market, congratulating us on a very strong quarter. There were some really nice numbers in there as records. So after closing FY '25 with the net profit, our first full year net profit, we were just off $6 million annualized sales for Q1, running at around $24 million if you extrapolate that over the following 3 quarters. EBITDA has reached $462,000 for Q1, which is a really strong number for Biome, and we continue to work on our EBITDA. Now we are 7 quarters in a row with positive EBITDA. Cash receipts was also a really strong performance for Q1 with $7.14 million and almost $1 million in cash came in positive cash flow for the quarter as well, which Biome carefully used to pay down some of its inventory finance facilities that we use on a recurring basis just to support the growth of the company. The cash receipts up 84% was a really strong outcome as well. And the accounts department did a great job in making sure that we are managing cash in and out. But after closing Q4 in June with some of the big public companies that we work within our distribution chain, we then started a really strong quarter, ensuring that we were making all of our supply partners carry effective stock weight as well. So a lot of that inventory that we built up in Q4 was then used up in Q1. We did continue to obviously rebuild inventory as we always do every quarter, but now we have a better balance and the cash and the inventory levels are at much more appropriate levels closing Q1. So this is just a bit of a visual indication of how Biome is tracking this growth machine that we all know and love. So we always have record months. We always have record quarters. It's become something that people almost just expect, but it is nice to be able to see that rolling cumulative sales now. So we have passed -- as of September 30, we've now passed $20 million. So another massive milestone for Biome on our continuous growth journey, passing $20 million in the last 12 months of cumulative sales. You can also see at the bottom here, this is the graph that I pulled out of our Appendix 4C that went out last week, the quarterly growth as well as the annual rolling 12 months growth, which is continuing on the same momentum, is starting to resemble a bit like a J, which is very exciting for all of us. A bit of a recap on how we do what we do at Biome. So we don't just develop products and put them through sales and marketing machines to promote them in a pharmacy chain. We are a sophisticated brand that leads with education. We develop high-quality education resources and content off the back of our own clinical trials, which we essentially then own and are able to talk about them first party with health professionals. We gain the trust, the recognition that we are a best-in-class product with our partners, pharmacists, doctors, integrated medical professionals, natural medicine professionals like naturopaths, nutritionists and dietitians, then they'll effectively actively recommend these products as a key opinion-leading recommendation, a very powerful model. As a result, Biome consistently sees much higher individual sales rates in single accounts than other brands in those accounts. I'm talking about including the large multinational, multibillion dollar companies that traditionally have done very well in pharmacy and still are. But Biome has developed a model where we can make more money for the pharmacists, more money for the practitioner, but most importantly, we provide a best-in-class product that is improving our patient health outcome. A bit of a recap on our Vision 27. So it feels like a lifetime ago, last September. It's only been 12 months since we've released our 3-year strategic plan. We're almost 1.5 years through it and tracking on or ahead of schedule in most, or if not all, of those targets. The top line goal was a minimum of $75 million cumulative sales from FY '25 to FY '27. We're well on track for that. And you can certainly see after Q1's extrapolated numbers of about $24 million rolling sales forward, we are absolutely on track to achieve that target. And I would hope to see that we do get a bit of a rerate sooner than later now that we have continuing positive cash, positive EBITDA and that we are absolutely on track for that 3-year forecast that we did put to market. We also put out a goal to be able to get from 5,000 up to 8,000 distribution points in the Australian market. We gave an update on that about 6 months ago, well ahead of schedule, and I expect at half year account, we'll be able to give people a meaningful update on our distribution growth. But essentially, where it's at right now, we have the ability to add distribution if and when we want. The challenge is always ensuring we bring on new pharmacy chains, new groups of practitioners at the right time so we can develop them appropriately and not overwhelm our team of 15 expert health practitioner educators in the field from having to just take on too many new accounts at the one time. Our business model has always been develop and be one of the most important and profit-generating brands within each account rather than be everything for everyone. The co-prescribing or adjunct medication market is something that we've always spoken about a lot as well. We truly believe Biome is one of the only, if not only, brands and companies in Australia that has a meaningful opportunity to have our products co-prescribed alongside medications. This opportunity, the blue sky, there's 330 million prescriptions a year in Australia through pharmacies. Every single one of those conversations with the pharmacist and a patient is an opportunity to recommend one of Biome's 18 AP products and now 4 Activated Therapeutics products alongside those medications. Why would they do? Probiotics have a close to perfect safety profile, no known drug interactions, and we're the only ones that have clinical trials on these diseases and health conditions that can be used safely alongside those products. So again, back to the pharmacist will make more money, grow their basket size, grow their gross profit, but most importantly, improve the patient health outcome with or without a medication in between. International market acceptance and growth. This is something that we have spoken a lot about as well. There have been recent updates on that. Canada, we will give a meaningful update as well at half year, but we're very pleased with the reception we've received for our Activated Probiotics brand in the Canadian market. We now have 5 or 10 significant supply deals done with retail pharmacy chains, health food shops. We have a strong distribution partner in Ecotrend Ecologics that are really prioritizing Biome's Activated Probiotics and have their own field team working along our sales and education staff on the ground in Canada every day. I was recently there only 2 weeks ago, I spent a couple of weeks on the road in Canada. And as I already said, the reception has been very strong, very minimal competition, certainly no sophisticated competition and incredible health professionals in the market that arguably are on par with Australian health professionals as industry-leading recommending these types of products. Beyond international markets, obviously, we're in Europe, we're in New Zealand as well. We'll get on to that a little bit later. We do have several other key initiatives that we're working on as part of Vision 27, including the development of Biome's own intellectual property, BMB18, our Lactobacillus plantarum strain. There will be a meaningful update on some clinical trial programs sooner than later. And that development will really drive innovation and new product launches into FY -- the back half of FY '26, FY '27 and the years to come. New clinical trials are always on the horizon for Biome. And as usual, we do a pretty good job of getting support for funding with governments, universities and our research partners as well. So we've done a very good job of keeping our R&D budget intact and under control. And I don't expect it to blow out more than -- not blow out, I don't expect to be asked to be spending more than $200,000 or $300,000 a year on R&D. But at the same time, pumping out world-leading targeted probiotic products with close to no competition or no competition in the Biome-owned IP. The new brand and product range. So I briefly spoke to that a moment ago. In June and July of this year, we launched our Activated Therapeutics to sit alongside Activated Probiotics. These products have been very well received by pharmacy. I suppose one of the key metrics that they look at in the retail land or health retail land is who's growing and who's doing well. Biome's Activated Probiotics is growing 8 to 10x the industry average in our category, that practitioner only or probiotic space behind the counter space and pharmacy. As a result of growing 8 to 10x the other brands in the industry, we're being offered more and more shelf space. So when we presented the 4 new products under Activated Therapeutics, we have the opportunity to put them into all of our key partner stores in TerryWhite, Priceline, Blooms The Chemist, and obviously, all of our practitioners ran to grab them as well. So distribution and growth, we've spoken about this already, but again, it's nice to see a bit of a scale. One point that I will mention is Biome's story is not launching products and growing distribution just to add revenue on top of revenue. The growth machine really is in developing this independent accounts. So our independent community pharmacies often report up to $200,000 or $300,000 of revenue or $100,000 to $200,000 of gross profit from our small range of 18 products on two shelves. We're not talking about a whole bay of vitamins. We're talking about 12 to 18 products on a shelf, delivering more gross profit than some brands with 100 to 200. So really, this growth graph really shows you, as the distribution grows and it has been strong growth in distribution, the growth in sales has been significantly more rapid being that our focus is developing those accounts to higher sales levels. So back on to international markets. I've spoken a little bit on Canada. I wanted to give a bit of an update on Ireland and also the New Zealand market. So we did announce the deal with Uniphar only a couple of months ago and the deal with Propharma in New Zealand. So Uniphar being the largest pharmacy wholesaler in Ireland or one of 2 and then Propharma is the largest in New Zealand, which is EBOS-owned, one Biome's key partners that do our Symbion pharmacy distribution in Australia. Both groups have aligned large distribution health retail outlets. So we did announce a deal with Green Cross pharmacy, which is currently in the process of rolling out. So any day now, we'll be having product reach the shelves of Green Cross pharmacies, but already independent pharmacies across New Zealand are now buying our product to support the existing practitioner medical market that we already had developed for the last 2 or 3 years. Same thing in Ireland, independent pharmacies are now buying our products. We are working on some of the larger banner groups as well, and we'll have an update on that sooner than later, but expect to see the growth in New Zealand, Ireland and Canada delivering a very strong performance in our international markets for FY '26. Something a lot of in stores have come to me and asked about they want that proof of concept. I said, well, we've done the first 1.5 which is always challenging to get off the ground. Once it's moving, the Biome machine takes over. We have industry-leading sales consultants, educators, content and the best products in the market. And essentially, once you get up and running, we are seeing that machine work and scale in these different markets. So Canada will really set us up long term for a foundation and base for the rest of North America, and our trading business that we already have existing in the U.K. is going to be a great foundation for us to continually scale across other territories in Europe. A bit of an update on those Activated Therapeutics products that I mentioned to you earlier. So these are the four products. Very quickly, I'll run through them. So Synbio-GOS is an incredible product. It is our first in the world launch for this combination of Bimuno GOS, the world's -- arguably the world's most well clinically proven fiber. Matched through an in vitro clinical trial with two of our favorite probiotic strains, Lactobacillus plantarum HEAL9 and Lactobacillus paracasei 8700:2. These two combinations or the combination of these two probiotic strains and the Bimuno GOS fiber essentially create that symbiotic effect to improve what they're already doing for humans. What are they doing? This is a very powerful gut healing product. It repairs the gut lining, the idea is that will reduce leaky gut, which downstream should also prevent a number of serious medical conditions and diseases. It is a really nice preventative concept also to help people with more severe gastrointestinal symptoms. Not to take anything away or cannibalize activated probiotics. This is a foundation product for people to take when they have been told by a health professional or made their own decision that they have severe gastrointestinal issues. They can start with Synbio-GOS and then move on to our Activated Probiotics for more targeted support. Oestro-ISO here is a well clinically proven product to support perimenopausal symptoms. So unfortunately, for a lot of Australian women and women in other markets where we work, this is a reality of the aging population, dealing with hot flashes, dealing with some of the mental health challenges of that perimenopausal period. It's a very powerful tool to add to the toolkit for our practitioner customers to able to work with their patients. Macro-PRO is addressing the massive GLP-1 market. Something that Biome is very famous for is not jumping on trends. Why do I say that when I mentioned a nutrition support product alongside GLP-1s, this is our answer to supporting patients with some of those side effects or symptoms. There is a massive market out there. People are getting their hands on these medications. The reality is some of the most significant side effects are constipation, diarrhea and also rapid muscle loss as well. So our view on this is we want to support those patients with some of their symptoms. And this also doubles as a very high-quality elderly nourishment product as well, addressing the fact that many of the meal supplements in this market currently certainly dispensed in hospitals are full of sugar, getting the calories from sugar, which is not ideal for our loved ones. And finally, the last but not least, Pepti-BIOTIC. This is an incredible product addressing the massive medication market and general market for gastric reflux, typically named GORD or GERD. So Pepti-BIOTIC is a fermented soy product, which has been fermented with a special probiotic strain called Lactobacillus delbrueckii R-187. It's a bit of a tongue twister. And the combination of this strain, which becomes then a post biotic or a heat-treated killed probiotic with the soy product, produces a very tolerable, enjoyable flavor. It's a watermelon flavor and you get instant support from that heartburn reflux as well as long-term support in reducing the instances of those reflux events. So as you can see here, these Activated Therapeutics products, they sit very nicely alongside Activated Probiotics. You can go see them today in your TerryWhite Chemmart store, your Priceline Pharmacy, your Blooms The Chemist around Australia. They should be merchandised right alongside and they'll be really working to support new patient populations that we can't currently support with probiotic interventions. So a bit of a summary before we jump into questions. So as most of you will be aware, we had a very strong FY '25. We closed the year with $18.4 million and a couple of hundred thousand in net profit, passing that line and giving us now the operational leverage to continue to drive net profit, EBITDA and positive cash, and slowly but continually reinvest in the growth machine to maximize shareholder value by appreciating the market capitalization and the share price of Biome. Quarter 1, we did $462,000 in EBITDA adjusted for cash, noncash share-based payments as we always do with our EBITDA number. First half FY '25, just looking at the difference in the growth in EBITDA, $462,000 versus the half, first half of last year, we did $356,000. So nice to sort of see how that EBITDA is consistently growing. We've maintained our gross margin above 61%. As far as I'm aware, this is industry-leading in our space. There aren't many brands that manage to keep it above 50%. The key reason for that is our products are never discounted. We don't do deals. Our product is a solution or an outcome that we're providing health professionals. It's not a deal. It's not a catalog, it's not something on promotion. And as a result, we don't erode our margin or allow that to happen. We've got improved cash balance this quarter, hovering around $3 million after we paid down a significant amount of our working capital line of credit. Distribution continuing to grow plus 6,000, and as I mentioned, the international markets are continuing to scale, and we'll have further updates throughout the financial year. I suppose the only other point left on this is we continue to maintain our spot as the #1 growth brand in the Australian market. So that's all vitamin brands, probiotic brands, complementary medicines, preventative medicines. Within the pharmacy space, we keep getting reports from our partners that we're the #1 for growth and we are climbing the scale. We are now the #2 probiotic brand in community pharmacy in total revenue. And we're not too far off that #1 spot as well. I expect to think we can get there over the next couple of years while we're also bringing in substantial revenue from our international markets and continuing to scale and grow. So with that in mind, I will turn over to questions. If you just give me a moment, I will have to bring them up.

The first one, how much revenue did Activated Therapeutics contribute in the quarter? Okay. Without having the number directly in front of me, what I will say is new product launches are very immaterial when it comes to revenue growth. It's very intentional that Biome does not overload stores. We don't launch a product and send 12 boxes of every line out to our 3,000, 4,000, 5,000, 6,000 accounts. We try to start very lean, and we want to focus all of our business development and strategy on consumer purchasing, consumer repurchasing patterns or sell-through. Sell-in is not a measure of success. And I think everyone will agree that and hopefully, will be supportive that that's what we focus all of our KPIs internally on and all of our sales targets as well. So I would estimate Activated Therapeutics may have contributed $200,000 maximum to the quarter, possibly less as some of it also dropped into Q4. So potentially significantly less than that. What was same store sales growth? Unfortunately, I don't have it on hand. I have to run an analysis of that. I'd be happy to bring that to the next webinar as a key point. However, last time when we checked, which is about 3 months ago, same-store sales growth was tracking slightly ahead of total growth as well. So when we measure same-store sales, it's usually focused on the 70% of our Australian business, which is the community pharmacy where we have really strong data. And the last number we checked on is 3 months ago, we were running at about 50% same-store sales growth. So I don't expect it to have changed significantly over the last quarter. Next question. The company launched into Canada about a year ago. Can you provide some more color on sales have been progressing? So we haven't given an official update on breaking down each of our territories within international sales. We've been rolling them together for the time being. That won't be forever. We will start to break them out into different chunks in different sections and provide more meaningful updates on each market. But what I can say anecdotally is Canada is exceeding our expectations. There's three key themes. There's very high barriers to entry with Health Canada. You must be a GMP pharmaceutical manufactured product to even get access to the market via Health Canada. That rules out any competition from the U.S.A., Asia or Europe. So essentially, Korean, Australian or Canadian companies come into the market. The local brands have, I suppose, been a little bit fortunate to have lack of international competition coming in. And as a result, we've seen that they are about 10 or 15 years behind our approach and strategy around clinically validated evidence-based probiotics. So the competition, while it's not insignificant, significantly further behind in their innovation. The health professionals are very advanced and the barriers to entry are very high. So being that Biome has spent 2 years getting through Health Canada, we're now in the market, we've got significant ranging of the products in pharmacy chains, health food chains and practitioner clinics and medical clinics. And what's probably most interesting about Canada and also the rest of North America is there is a qualification which is a medical qualification or a doctor degree. If you do start up for medicine, you can then choose your specialty to be natural medicine and become a naturopathic doctor. This is a qualification, as far as I understand, only exists in Canada and the U.S.A. and it's very powerful being those naturopathic doctors lean on products like probiotics ahead of any other category. So it's very interesting as we continue to scale in that part of the world. How is overseas revenue tracking versus domestic? I mean the nice numbers we reported was 40 -- 42% domestic versus roughly 70% growth international. I would like to see international increase from 70% this year. Too early to say. Only a quarter into the year being that some of those revenues in some of those markets are still lumpy. But as they do normalize, we'll get a bit of picture at half year, and we'll report on that at half year. So not too long to wait, but I'm not going to say it's positive if it's not going to be and whenever have we not delivered on a number that we said we were going to deliver on. Next question. What was the thinking behind the Mecca distribution deal? And are there other targets like that, that Biome is working on? I think I did address this at the last webinar, so yes, Mecca being a -- traditionally a beauty retailer very interesting, though. They are, in my opinion, one of, if not the best retailer in Australia, strategically positioning, branding, product ranging, very high end, are very focused on solutions and outcomes like Biome is, even if it is within beauty and skin health rather than traditional health care. So Mecca's new Health Apothecary has launched in their flagship stores in Melbourne and Sydney. And this was an opportunity for Biome to actually work with integrated health professionals, but in this premium retail environment, which doesn't break any of our rules. So the products sit within a dispensary, out of reach from customers in a lot covered and are dispensed by health professionals in that outlet. It is very interesting. I'd say watch this space. It's a pretty interesting and powerful partner for Biome as well, not just from a sales growth and a marketing perspective, but also from an innovation and product development. So I'd also say -- I'd say watch this space. And yes, we will always be considering unique health distribution channels where there is the appropriate health professional in store. Is Biome currently in discussions with Chemist Warehouse or other major pharmacy retailers? Biome is in discussion with all pharmacy retailers constantly. There's no one that we're not discussing with. And while we have been very happy to say that our model is not the discount model, it's not the e-commerce model, it is provide the most -- the highest value opportunity to make profit, improve patient health outcome in premium health retail, health-focused health retail, which I personally do not believe discount pharmacy is within health. They're much more in the retail space rather than in health whereas groups like TerryWhite and Priceline are in absolutely in the health space and providing health advice for patients. So we never say never. But for the time being, we're absolutely focused on premium community pharmacy. We have no intention to launch into the discount chains and our results speak for themselves. When you're growing 8 to 10x the category average, and we continue to do so by also protecting our brand and prevent it from being put online or put on to discount, it's a good long-term strategy. So yes, the discussions are always open. But for the time being, we are sticking with our premium health retail strategy. What led to the increase in employee costs for the quarter? Without having the numbers in front of me, I don't have the exact numbers. We did have 3 or 4 new staff join throughout the quarter, but that wouldn't have done a material increase. The most obvious answer is FY '25 bonuses for staff. So key staff get their bonuses in the annual plan. So usually, Q1, we have higher bonuses and that tends to be the main reason for higher employee cost for the quarter. Without having my CFO next to me all the numbers broken down, I would be very confident to say that's the answer, but I can't say with 100% certainty. Does Biome have any plans to collaborate with social media influencers to increase brand visibility and consumer engagement? I'd say Biome's key strategy is social influencers, just not social media influencers. Biome works with key opinion-leading health professionals in a white coat with a health qualification, they come with a lot more trust than traditional social media influencers or micro influencers. So while we don't pay these people for their advice, they give it freely and it's much more trusted when it is coming organically from a health professional. So we do absolutely still work with micro influencers and social media influencers through Instagram, but it's not part of a paid marketing strategy, and it's a very fine line. Certainly with the TGA in Australia, our Australian regulator, it's actually illegal now to have influencers recommend health products to their audience. So it's something we need to be very careful on. And as an industry leader in quality, efficacy, evidence and communication, we need to make sure that we're only aligning with people that absolutely have the ability to talk as an authority on these topics. Okay. Sorry. Couple more questions. You've achieved 7 consecutive quarters of positive EBITDA and 40% year-on-year growth as a minimum. What's driving sustained profitability? And how do you see this trajectory continuing? My goal and the Board's goal is to maintain Biome as a growth machine for years to come. We don't expect our growth to erode as others have, and we're ensuring that we have future innovation and product developments to be able to bank on continuing to develop our existing product portfolio by doing additional clinical research and expanding the use of existing products into new health conditions. This is a really innovative approach that hasn't really been done traditionally in our industry. Brands will launch a product, sell the product, get a new product out to market. And then often, you'll see companies in health care with 200 to 300 SKUs or products, sometimes more. Biome's approach is every product has to be meaningfully contributing. We don't want massive stock write-offs, and we don't want to burn relationships. These products that we launch are only launched if they're solving a meaningful problem, if they're first to market and if they've got meaningful, significant human clinical trials behind them. So our approach is to continue to develop those products to feed the growth machine, continue to scale overseas, very carefully and in the right time, invest in developing those markets with our cash reserves and maintain that positive cash flow. So we don't expect to be burning -- materially burning cash, we don't expect to be dropping out of profit, but maintaining that growth machine for many years to come. Only one more question unless there's any more to come through for me otherwise. With your entry into Canada and expansion across retail channels, what does your international growth pipeline look like for the next 12 months? I think that's a really interesting question. So Canada, there's a huge opportunity still with continuing our growth journey into new distribution. There are a number of practitioner e-script providers, so almost telehealth, there's a lot more health retail, and we haven't even scratched the surface of The Maritimes, which is that French quarter or Quebec region, which is a really important part of the Canadian market as well. So currently in Canada, we have two field sales and education reps on the ground, one looking after Ontario and Toronto, a second looking after British Columbia and the Vancouver region. We're putting a lot of emphasis on a couple of other key quality hires to drive sales only and running that satellite sales and education model reporting back into the Australian model. So different retail channels. We're already in pharmacy. We're in high-quality health food stores that have health professionals and integrative natural medicine dispensaries inside them. And obviously working and continue to work with these naturopathic doctors as they will help grow the brand in Australia. So there is obviously an opportunity down the line for Canada to be a foothold, as I said, for the rest of North America, but we have a huge opportunity in Canada to essentially replicate the Australian business. And while we keep focused on growing that core sort of $20 million, $25 million Australian business, significantly higher than we are today. So we're not trying to grow international because we see Australia slowing down. We're slowly and cautiously taking opportunities but really resourcing it from the Melbourne head office and carefully managing my time and the rest of the team's time with all the different growth initiatives that we're working on. I think that's all we have time for today. Sorry, one more has just come through. I'll get into this last one. Everybody will love this one. So one more on inventory. For the June quarter, you had to spend additional funds on building your inventory. Do you feel you have sufficient inventory for your launch into Canada if very successful? It's interesting there's a lot of questions on Canada. So inventory, we don't look at it in a 4C perspective. A 4C is a specific point in time. It's a day of reporting. We have huge amounts of volume and inventory moving day in day out. Majority of our orders globally come through on a Tuesday, and these will be maybe $0.5 million to $1 million sometimes in individual pallet orders that are coming straight out of our warehouse. And that's a lot of inventory that will be moving in a single week. So while we did have unusually high inventory at the close of Q4, there was a significant build to support FY '26 and ensure that with our longer lead times making things in Italy that we've had enough stock on hand. The optimal inventory level for Biome is between $2.7 million and $3 million on a rolling recurring basis. That number might jump up $1 million more, $1 million below in base cost inventory. But essentially, that's the rolling number. So if you see a 4C where it's a little bit higher, a little bit lower, it might be very different the next week. And just a week after the last 4C, we had about $1.5 million of that stock gone. So it's a very manageable position for the time being. Certainly, for the next 2 or 3 years, we think we can maintain that roughly $3 million of recurring revenue and supply all of our international markets. We're just turning it over at a higher rate. As we do onshore manufacturing to Australia, one of the key components of that, which is part of our Vision '27 strategy, and it is something that we are well down the pathway of development, and we'll have updates on shortly, is to significantly reduce our inventory lead time down from 6 to 7 months down to 2 and then increase our stock turn and reduce our working capital. So even if we didn't improve margin or in the $1 million plus we're saving on shipping immediately, which is a possibility, but I don't want to make a promise until the numbers come out, we will significantly reduce working capital requirements. Even at double our revenue rate, we'll probably be able to manage not holding more inventory than we are today. So that's probably as good an answer as I can give on inventory, but inventory is under control. It's moving in and out. We're not having any out of stocks and most lines are appropriately stocked with not too much more than roughly 6 months of stock. So thank you all for your ongoing support. I appreciate you joining me today. This webinar has been recorded, so we will put it up on our Investor Hub. So for anyone that missed out, it will be available and will be e-mailed out. Thank you again. Bye-bye.