Else Nutrition Enters the Chinese Market, via a Signed Agreement with Baozun, a Leading E-Commerce Distributor in China

Rhea-AI Summary

Else Nutrition Holdings Inc. (BABYF) announced a distribution agreement with Baozun to sell its plant-based infant nutrition products in China starting Q3 2022. The global infant formula market, valued at $77 billion in 2021, is projected to reach $110 billion by 2026, with China holding about 40% market share. The Chinese market for infant formula is expected to grow at a CAGR of 8%. This strategic move aligns with rising consumer demand for dairy and soy-free alternatives, essential for the lactose intolerant population in China, estimated at 47% among infants and toddlers.

Positive

• Distribution agreement with Baozun for access to Chinese market.
• China's infant formula market projected to grow from $30 billion in 2021 to $40 billion by 2025.
• Increasing demand for dairy-free alternatives in China aligns with company offerings.

Negative

• None.

• Increasing demand for premium infant nutrition solutions in China, which accounts for approximately 40% of the global infant formula market, showing Else’s substantial potential for continued growth
  

VANCOUVER, British Columbia, June 07, 2022 (GLOBE NEWSWIRE) -- ELSE NUTRITION HOLDINGS INC. (BABY) (BABYF) (0YL.F) ("Else" or the "Company"), the plant-based baby, toddler, and children nutrition company, announced today that Baozun, a leading e-commerce solutions provider in China, the Company expects to start selling Else products in China in Q3 of this year.

The global infant formula market in 2021 accounted for approximately $77 billion. The market is expected to grow and reach around 110 billion by 2026, China will remain the market leader with about 40% of the global market share. China’s infant formula market is projected to grow at a CAGR of 8%, from $30 Billion in 2021 to $40 Billion by 2025.

With Baozun's e-commerce, end-to-end solutions, the Company would have direct access to retail buyers in China, starting in Q3 2022, through a wide range of online shopping platforms such as Tmall, JD.com, Kuaishou, WeChat Mini programs, and many others. With the recent distribution agreement signing, the Company expects to start operating on China’s cross-border e-commerce platforms as early.

“Selling our innovative plant-based clean pediatric nutrition products in China is a key milestone in the company’s strategic plan to become a player in the global infant nutrition market. Following our recent growth in North America, we are on track for expansion globally. We are happy to help fulfill the increasing demand in China for a dairy & soy-free pediatric nutrition alternative, especially considering the very high rate of lactose intolerant population in China of about 22.4%, the additional suspected lactose intolerant population of about 25%, and the proportion of infants and toddlers under 2 years who claim to experience allergic symptoms is as high as 40.9% (3.7 million infants/toddlers).

Another indicator of the need for plant-based alternatives is Chinese consumers’ rising awareness of health and sustainability which has led to the increasing consumption of plant-based milk, especially among Gen Z and Gen Y consumers. The average annual growth rate of the Chinese plant-based milk industry is expected to remain above 20% in the next few years, and the market size is expected to reach 300 billion Yuan ($56.65 billion CDN) by 2025“ said Hamutal Yitzhak, the CEO and Co-Founder of Else.

About Baozun

Baozun is the leading brand E-commerce solutions provider in China, Baozun’s integrated capabilities encompass all aspects of the E-commerce value chain covering IT solutions, store operations, digital marketing, customer services, warehousing, and fulfillment. Baozun helps brands execute their E-commerce strategies by selling goods directly to customers online or by providing services to assist with E-commerce operations.

Baozun was listed on NASDAQ (NASDAQ: BZUN) in May, 2015 and completed the secondary dual-listing on HKEX in September, 2020. According to iResearch, Baozun is the leader and a pioneer in the brand e-commerce service industry in China.

With a leading international vision and pragmatic localization implementation expertise, Baozun has successfully empowered brand partners in executing e-commerce strategies and won reputation. Currently, Baozun serves 333 brand partners across 8 categories.

About Else Nutrition Holdings Inc.

Else Nutrition GH Ltd. is an Israel-based food and nutrition company focused on developing innovative, clean, and plant-based food and nutrition products for infants, toddlers, children, and adults. Its revolutionary, plant-based, non-soy formula is a clean-ingredient alternative to dairy-based formula. Else Nutrition (formerly INDI) won the "2017 Best Health and Diet Solutions" award at Milan's Global Food Innovation Summit. Else Plant-Based Complete Nutrition for Toddlers was recently ranked as the #1 Top Seller in the baby and toddler formula category on Amazon. The Company recently received the World Plant-Based Award for “Best dairy alternative product” in New York at World Plant-Based Expo in late 2021. The holding company, Else Nutrition Holdings Inc., is a publicly traded company listed on the Toronto Stock Exchange under the trading symbol BABY and is quoted on the US OTC Markets QX board under the trading symbol BABYF and on the Frankfurt Exchange under the symbol 0YL. Else's Executives include leaders hailing from leading infant nutrition companies. Many of Else advisory board members had past executive roles in companies such as Mead Johnson, Abbott Nutrition, Plum Organics, and leading infant nutrition Societies,  and some of them currently serve in different roles in leading medical centers and academic institutes such as Boston Children's Hospital, Pediatrics at Harvard Medical School, USA, Tel Aviv University, Schneider Children's Medical Center of Israel, Rambam Medical Center and Technion, Israel and University Hospital Brussels, Belgium.

For more information, visit elsenutrition.com or @elsenutrition on Facebook and Instagram.

Investor Relations Contact:
Lytham Partners, LLC
Mr. Ben Shamsian
New York | Phoenix
E: shamsian@lythampartners.com
P: 646-829-9701

Toronto Stock Exchange

Neither the Toronto Stock Exchange nor its regulation services provider (as that term is defined in the policies of the Toronto Stock Exchange) accept responsibility for the adequacy or accuracy of this release.

Caution Regarding Forward-Looking Statements

This press release contains statements that may constitute “forward-looking statements” within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as “will” or similar expressions. Forward-looking statements in this press release include statements with respect to the anticipated dates for filing the Company’s financial disclosure documents. Such forward-looking statements reflect current estimates, beliefs, and assumptions, which are based on management’s perception of current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. No assurance can be given that the foregoing will prove to be correct. Forward-looking statements made in this press release assume, among others, the expectation that there will be no interruptions or supply chain failures as a result of COVID 19 and that the manufacturing, broker, and supply logistic agreement with the Company do not terminate. Actual results may differ from the estimates, beliefs, and assumptions expressed or implied in the forward-looking statements. Readers are cautioned not to place undue reliance on any forward-looking statements, which reflect management’s expectations only as of the date of this press release. The Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/07ecf5fc-a0c6-47b3-963d-d8fa24684e74

FAQ

What is the significance of Else's agreement with Baozun?

The agreement will allow Else to sell its plant-based products directly to consumers in China, enhancing its market presence.

How large is the Chinese infant formula market?

The Chinese infant formula market is projected to reach $40 billion by 2025, holding approximately 40% of the global market share.

What growth rate is expected for the infant formula market?

The market is expected to grow at a compound annual growth rate (CAGR) of 8%.

What are the health trends influencing Else Nutrition's product sales?

Rising awareness of health and sustainability among Chinese consumers is driving demand for plant-based nutrition alternatives.

When will Else's products be available in China?

Else expects to start selling its products in China in the third quarter of 2022.