Cellmid Limited (ASX: CDY) has signed, via its subsidiaries Advangen Limited and Advangen Inc (Japan), an exclusive master distribution agreement with Ourui Health Management Limited for the distribution of its Japanese, Ju-Ju and Lexilis branded, anti-aging hair and skincare products
CEO, Maria Halasz, said Ourui Health Management Limited is based in Hong Kong and was founded by serial beauty entrepreneur Steven Ko. Mr Ko was one of the founders of Red Earth, an Australian make-up brand sold through 600 retail stores in 45 countries before it was acquired by Esprit in 2001.
Other successful brands in Mr Ko’s stable include SkinVitals, the face masks that are sold in Sephora, and Pearlosophy, a natural skin care brand using pearl extract and sold in China though social channels. Mr Ko will be utilizing an omnichannel approach when marketing Jo-Ju and Lexilis, primarily focusing on social commerce.
This is a transformational deal for Cellmid, as it completes the foundation of our China growth strategy,” Ms Halasz said.
“We expect this Agreement, together with the recently revised Aeon International agreement for the evolis pharmacy products, could contribute up to 40% of the revenue by FY2023, as outlined in our recent growth strategy update.”
Key terms of the Agreement are:
Ten-year agreement: It is for a period of 10 years, extendable by 10 additional years, subject to performance by the Distributor and is exclusive for Asia (including all countries except Japan).
Distributor to invest in marketing: The Distributor will bear the costs of marketing, brand building, social media, live streaming, celebrity endorsements and traffic campaigns.
Minimum purchase orders: The Distributor must order the Minimum Annual Purchase Requirement of 500,000 units of products collectively across the two brands in year 1 and 1,000,000 units of products in Year 2, with double digit (percentage) annual purchase increases thereafter.
Effect on FY2021 revenue: Shipment of products under the Agreement is expected to commence during the second half of FY2021.
