The vegan boom has revolutionized the health and wellness market. So much so that the global vegan cosmetics market could be worth up to $20.8 billion over the next five years, according to Grand View Research. “Consumers are shifting their preference from chemical-based beauty products, owing to safety reasons, and are drawn towards ‘natural’ and ‘safe’ products. This, in turn, is likely to drive the adoption of vegan beauty products in the coming years. Furthermore, a growing number of social media channels and beauty bloggers are promoting makeup hacks using vegan beauty products. This, in turn, is boosting manufacturers of vegan beauty products,” added Prophecy Market Insights.
In addition, “Major cosmetics manufacturing companies across the globe are realizing the importance of making products that use ingredients which are mineral-based or plant-based, rather than manufacturing products that are infused with animal extracted ingredients. Vegan cosmetics are gaining popularity due to their superior properties,” as noted by Research and Markets. That being the case, the story is creating big opportunity for companies such as Better Plant Sciences Inc. (CSE:PLNT)(OTC:VEGGF), E.L.F. Beauty Inc. (NYSE:ELF), Beyond Meat Inc. (NASDAQ:BYND), Amazon.com Inc. (NASDAQ:AMZN), and Ulta Beauty Inc. (NASDAQ:ULTA).
Better Plant Sciences Inc. (CSE:PLNT) (OTC:VEGGF) BREAKING NEWS: Better Plant Sciences Inc. is pleased to announce the completion of its acquisition of Jusu, a Canadian health, wellness and lifestyle brand that focuses on premium plant-based products. The acquisition consisted of the purchase of assets of Jusu Bars Inc., Jusu Body Inc. and Jusu CBD Inc. in an all stock deal for $2,225,000. Better Plant now carries on these businesses through its wholly owned subsidiary Jusu Wellness Inc. These assets are in addition to the Better Plant owned wellness brands Urban Juve, Wright & Well and NeonMind. The combined business of Better Plant now has over 400 product formulas in its catalogue and over 150 different products currently for sale under various brands.
“Jusu is an excellent addition to the Better Plant portfolio. We are focused on bringing the most innovative and premium plant-based products to market to help our customers optimize their health, and well-being,” said Penny White, CEO of Better Plant. “Our plan is to grow the Jusu business, which is currently generating revenues of approximately $60,000 per month, by optimizing sales through eCommerce channels, strengthening the brand and product offering, as well as expanding through a franchise model.”
The purchased assets include all inventory, packaging, raw ingredients, and intellectual property related to JUSU’s 300 plant-based products for the home, body and baby, as well as the eCommerce sites that sell Jusu products, customer lists, certain juice bar equipment, and all tangible assets relating to the Jusu juice bar retail location in Cadboro Bay, Victoria.
The agreed purchase price for the acquisition was 22,000,000 units of Better Plant at a deemed price of $0.10 per unit (after payment of $25,000 for inventory on September 1, 2020), with each unit consisting of one common share and one warrant to purchase a common share at $0.11 per share for two years. Of those units, 19,000,000 units were issued at closing on October 9, 2020. 3,000,000 units were held back as security to ensure that Jusu Body Inc. and Jusu Bars Inc. are discharged from certain general security registrations. The unit shares are subject to a stock restriction agreement restricting sale of the units for four months after the date of issuance, and after that no more than 30,000 shares per day. Better Plant agreed to pay a bonus of 2.5 million units upon reaching $5 million in Jusu product sales within 3 years.
Pursuant to the acquisition, Better Plant will book revenues from all Jusu sales beginning October 9, 2020. The Jusu plant-based product sales for home, body and baby have historically been approximately $40,000 per month, with a gross profit margin of approximately 60%, not including marketing or overhead. Direct to consumer juice sales have only recently launched and have had a profit margin of approximately 65%, although this is expected to decrease to 30% due to disruption in supply. Jusu Bars Inc. shall continue to operate the juice business for a period of 120 days for a fee of 5% of such revenues payable to Better Plant as an operator fee. Jusu Bars shall pay for operating expenses and bill them back to Better Plant on a monthly basis, but operating expenses and operator fees in aggregate may not exceed the net revenues each month. Better Plant did not assume any of the liabilities of Jusu outstanding at closing.
In connection with the acquisition, Bruce Mullen, the founder of Jusu, has joined the board of directors of Better Plant. Since 2014 Bruce Mullen has been active as the largest shareholder and the director and chief executive officer of the Jusu companies. Penny White has resigned as director of Better Plant but she continues as CEO & President of Better Plant and its subsidiary companies, including Jusu Wellness.
Prophecy Market Insights reported that the global vegan beauty products market is estimated to reach USD$25.3 billion by 2029 with a CAGR of 5.9% between 2019 and 2029. Meticulous Research reported that the plant-based food market is expected to grow at a CAGR of 11.9% from 2020 to 2027 to reach USD$74.2 billion by 2027.
Other related developments from around the markets include:
E.L.F. Beauty Inc. (NYSE:ELF) is celebrating emerging makeup enthusiasts and the power of music for its fifth annual Beautyscape event, lending the opportunity to learn, grow, compete and collaborate alongside other up-and-coming creators. Featuring Grammy nominated global superstar Tove Lo, Beautyscape 5.0: The Remix offers beauty’s rising stars a once-in-a-lifetime chance to help build a cosmetics and skincare collection that will be sold through a national retailer. There will be three final winners who will be picked by a panel of judges and e.l.f.’s community.
Beyond Meat Inc. (NASDAQ:BYND), a leader in plant-based meat, announced the addition of Beyond Breakfast Sausage® Links to its line of innovative and delicious plant-based meat offerings. Designed to deliver the same taste and texture as pork-based links, Beyond Breakfast Sausage Links have no GMOs, bioengineered ingredients, synthetic colors, hormones, antibiotics or cholesterol, and have 40% less sodium than a leading brand of traditional pork breakfast sausage links.
Amazon.com Inc. (NASDAQ:AMZN) and Communities In Schools NOVA announced Amazon is making a $1 million donation to support the immediate needs of thousands of students from underserved communities in Northern Virginia amid the COVID-19 pandemic. Communities In Schools NOVA will distribute Amazon’s donation through its innovative “Right Now Needs Fund”—a flexible fund designed to meet the basic needs of schoolchildren and help eliminate barriers to learning. The Right Now Needs Fund in Northern Virginia will provide students with immediate access to urgently needed items including food, clothing, and school supplies across all 41 Arlington Public Schools and programs and all 18 Alexandria City Public Schools.
Ulta Beauty Inc. (NASDAQ:ULTA) announced financial results for the thirteen-week and twenty-six-week period ended August 1, 2020 compared to the same periods ended August 3, 2019. During the second quarter of fiscal 2020, the Company recorded store impairment and closure related costs that reduced reported net income by $33.5 million or $0.59 per diluted share. A reconciliation of non-GAAP financial measures to the respective GAAP measures is included in this release. “We have navigated the disruption and uncertainty of COVID-19 with our associates and guests at the heart of every decision. After closing our stores in the first quarter, we reopened our fleet in the second quarter with Shop Safe Standards and new operating procedures in place to protect the health and safety of all. I remain thankful and proud of our teams for their response and leadership throughout this challenging time and for their grace, agility and commitment to serving our guests,” said Mary Dillon, chief executive officer. “While the pandemic continues to impact our business, we are encouraged by improving trends. Comparable sales trends improved significantly throughout the quarter, from decreasing 37% in early May, as we began reopening stores, to decreasing 10% in July, when most of our stores were re-opened. Notably, sales trends have continued to improve, with comparable sales down in the mid-single digit range for the first three weeks of August.”
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