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Key points
- Both Bubs and Pushpay are fast-growing ASX shares with big growth plans
- Bubs is a globally-growing infant formula business which is seeing rapid uptake in Asia
- Pushpay is a leading digital payments business specialising in helping churches to process electronic donations and it also provides church management systems
Some ASX shares are generating slow-and-steady growth, whereas others are growing really quickly. A good portion of these rapidly-rising businesses have significant, long-term plans.
Australia is typically a good country to do business in, but being able to expand internationally gives them a much larger total addressable market.
These two ASX shares could be ones to keep an eye on:
Bubs Australia Ltd (ASX: BUB)
Bubs is a leading provider of infant formula, specialising in goat milk products. But it also has growing products in the (organic, grass-fed) cow milk infant formula range.
This company currently aspires to be the leading global family nutrition brand from Australia. It's looking for ways to grow through market and products expansion.
It recently released its FY22 second quarter trading update. It showed quarterly gross revenue of $19.9 million, which was up 56% year on year and up 8% quarter on quarter. For the FY22 first half, gross revenue was up 73% and up 57% half on half. The Bubs infant formula gross revenue went up 83% across all markets year on year and 13% quarter on quarter.
Gross revenue of branded products in domestic retailers was up 17% quarter on quarter for the ASX share. China gross revenue was up 121% year on year and up 21% quarter on quarter. International revenue, excluding China, gross revenue for Bubs products was up 66% year on year and 141% quarter on quarter. Bubs family nutrition new product portfolio is now being shipped to Africa, China, Singapore and Pacific Islands.
Bubs said that the corporate daigou channel demand has now completely returned. Demand has now exceeded pre-COVID levels.
In other words, it is seeing growth across the board.
The company's USA e-commerce sales are now live on leading retail platforms with Walmart, Amazon and Thrive. Plans are "well progressed" to secure distribution into bricks and mortar retail outlets during the second half.
It was cashflow positive for the second consecutive quarter, with a balance sheet of $30.6 million of cash.
Before this update, it was rated as a buy by the broker Citi with a price target of $0.63.
Pushpay Holdings Ltd (ASX: PPH)
Pushpay is a leading electronic donation business with tools for both processing digital payments as well as church management. Its client base is currently an array of large and medium US churches.
The ASX tech share has continued to grow its processing volume and net profit after tax. In the first six months of FY22 it saw total processing volume grow by another 9%. It's expecting more volume as more customers use more products and more people give digitally.
Net profit jumped 43% to US$19.1 million for the six-month period. This was partially helped by the increase of its gross profit margin, which went up from 68% to 69%.
Pushpay is looking to replicate its success in the Protestant segment of the market as it expands its services in the Catholic segment of the market "where significant long-term opportunity exists". But it is focused on further market share growth in the Protestant area too.
Parishstaq is targeted at the Catholic segment, with the majority of customers adopting this platform, which validates management's thoughts that a full product solution is what churches want.
The Catholic growth is a longer-term initiative for the ASX share, as it looks to grow the number of products purchased by customers as well as increasing the number of customers, as well as integrating the video streaming Resi Media business.
