Elixinol Wellness (ASX: EXL)'s Hemp Foods Australia brand records revenue increase of 19% in Q2 FY21

In the first half of 2021, Global hemp company Elixinol Wellness (ASX: EXL) recorded a 39% reduction in revenue compared to last year. But one section of their business flourished - their food brand Hemp Foods Australia. 

According to an ASX release dated August 17th, Hemp Foods Australia (HFA)'s revenue increased 19% in the second quarter of 2021. Specifically, the brand's grew from $871k in revenue in Q1 to $1,037k in Q2.

The company says this growth is due to a few factors, including an increase in eCommerce sales. Throughout Q2, HFA's eCommerce sales rose 8% compared to Q1 and 50% in comparison with sales from a year ago. This increase is due to their website performing better, as sales conversions increased 3%, transactions increased 12%, and the value of the average order grew by 4%. 

HFA has also begun selling a new product in Costco - a 1.5-kilogram tub of protein powder. Costco already sells the company's hemp seeds, which they first added late last year. Both of these are performing well and are sold in stores Australia-wide. The protein powder is part of the company's new Hemp Gold range, which accounted for sixteen per cent of the sales HFA made in Q2.

While the company doesn't name anyone, the release also mentions that they have secured a "new Asian export customer" for their Gold Hemp Seed Oil. 

Ultimately, Elixinol's CEO Oliver Horn says that the company is feeling "positive" about the company's future. 

With our tightly controlled and reducing cost base, healthy performing HFA business, improving US trading conditions and an optimised product range, we are feeling increasingly positive about our outlook.

The brand's growth is in line with the growth of Australia's hemp food industry as a whole. The Food Standards Code only permitted the use of hemp in food in 2017, so the market is still new. Despite this, many Australians have embraced hemp happily, as it is rich in protein, Vitamin E and fatty acids like Omega 3 and 6.