Bubs Australia has appointed Joe Coote as its new CEO with effect from yesterday (July 28), taking over from Reg Weine who was chief for the past two years.
Coote was most recently the CEO of Darigold, the fourth-largest dairy cooperative in the US based in Seattle.
Before that, he had been with the Fonterra Group for 12 years, with his last post as the president of Fonterra Americas where he oversaw over US$2b in regional sales.
The chartered accountant started his career in PwC where he stayed for 12 years, before he moved on to GSK in the UK, Colgate Palmolive in New York, and Coles Myer Group in Melbourne.
His appointment comes as Bubs Australia takes on a more active expansion plan for its infant formula business in the US market.
Bubs Australia’s infant formulas are sold in the US over 7,000 stores in 42 states, including its goat, 365-day grass-fed infant formulas under the US’s Enforcement Discretion policy — which allows temporary market access.
However, it has been looking into securing permanent access to the US and has started the application process.
It is expecting formal notification from the US FDA on permanent access by the end of this year.
“Joe’s strong financial acumen and leadership across the FMCG, dairy, and infant nutrition sectors align directly with Bubs’ strategic priorities.
“His proven track record in driving operational excellence and leading large-scale transformation across international markets will be instrumental in expanding our premium clean-label goat and grass-fed dairy product portfolio across key export destinations, including the USA, China, and other Asian markets.
“This combination of extensive expertise in supply chain, finance, and commercial operations together with his strong global networks make Joe as an ideal fit to guide Bubs through its next phase of growth, particularly his recent eight-year tenure in the USA as we anticipate securing permanent USA market access later in 2025,” said Katrina Rathie, Bubs Australia chair.
US becomes Bubs Australia’s best-performing market
The US was the company’s “best-performing market” in FY25.
In its Q4FY25 financial results released yesterday, the firm said that revenue in the US was up 52% year-on-year to AUD$53m (US$34.7m).
This was achieved by tapping into the growing premium infant formula segment.
The US is known for having high barriers of entry for its infant formula market.
In fact, Bubs Australia’s main focus has been on China until 2022, when the US authorities launched Operation Fly and Enforcement Discretion policy where it temporary lowered regulatory requirements for imports to tackle a countrywide shortage.
The shortage was caused by the Abbott Nutrition’s voluntary product recall and subsequent temporal closure of its Sturgis production plant.
This was when several infant formula manufacturers from Australia and New Zealand sought entry into the market — with Bubs Australia being the first Australia brand to have entered the US.
Bellamy’s Organic, Care A2+ were the other Australian brands which were subsequently allowed entry into the US.
Others approved were The a2 Milk Company from New Zealand, and international brands manufactured in APAC and Europe, including Danone, Abbott Nutrition’s products manufactured in Ireland, and Mead Johnson’s products manufactured in Singapore.
Since then, Bubs Australia has sought permanent access of its products in the US.
Last month, it lodged the New Infant Formula Submission (NIFS) for products that it is currently selling in the US.
It has also been running a clinical trial involving 478 infants in the US as part of its commitment in obtaining permanent regulatory approval in the US.
“With the USA already our biggest market and one in which we continue to see significant growth, it is pleasing to see that the overall regulatory progress remains firmly on-track.
“This remains one of the company’s strategic pillars and will underpin future sustainable growth,” said former CEO Reg Weine in an announcement last month.
Growth in other markets
Aside from the US, Bubs Australia has also seen revenue growth across its other key markets, including China and Australia.
Total revenue for FY25 was up 29% year-on-year from AUD$79.7m (US$52.2m) to AUD$102.5m (US$67.1m).
Full-year gross profit margin, however, was down 1.4% from 48.6% to 47.2%.
In China, revenue was up 22%, driven by strong cross-border e-commerce sales of its goat infant milk formula and supreme infant milk formula.
It has also expanded into the O2O (online-to-offline) channel, in which its products are stocked in 1,276 stores.
In Australia, revenue climbed eight per cent to AUD$19.8m (US$13m) led by a growing goat infant milk formula segment.
Elsewhere, growth was driven by Vietnam and Japan, with revenue from the rest of the world up 44%.
