Skincare brand Me Today to sell King Honey as losses mount

Skincare brand Me Today uses All Black Beauden Barrett in its marketing and his wife, Hannah, sits on the board. Photo / NZME

Me Today has put its honey division up for sale and announced the former head of skincare company Trilogy and current director, Stephen Sinclair, will take over as chief executive.

After posting troubling financials in half-yearly earnings, the company also said it plans to restructure debt and raise capital from shareholders.

The company, which uses All Black Beauden Barrett in its marketing, reported revenues of $2.3 million, compared to $3.6m for the six months ending December 31.

Total losses after tax climbed to $7.2m, a 24.9 per cent rise from $5.8m.

The current market capitalisation of Me Today is just over $1m.

Oh no, Honey

The Me Today board said it assessed the value of its honey division, King Honey, at $17.1m.

That figure is down from $21.1m in June 2023 and $36m in June 2021, when the company acquired King Honey.

Nearly three years ago, when the sale was announced, Me Today said the “business complements the Me Today brand and the acquisition will enable Me Today to expand its existing lifestyle, health and wellness businesses”.

The tone was far less buoyant on Wednesday.

“Following the acquisition of King Honey, the group has borrowings of $7.0m with the BNZ and a subordinated note payable to the Jarvis Trust of $5.5m. Given the performance of the King Honey business, payments to both the BNZ and the Jarvis Trust have not been able to be made as scheduled,” Me Today said.

The erosion of value is on account of “sales not getting to the level that was expected”, CEO Sinclair told BusinessDesk.

Director in, founder out

Sinclair is leaving his previous roles as chief financial officer (CFO) and company secretary to take the top job from company founder Michael Kerr.

The change in structure would allow Kerr to focus on what he was good at, Sinclair said.

“[Kerr’s] skillset is brand; he’s the founder of the Me Today business and brand,” Sinclair added.

“I’ve been involved in a whole lot more sort of corporate stuff than Michael has in terms of structure ... For where the business is now, this is how we can, we want, to run it and that’s why I’m stepping in.”

Chairman of Me Today Grant Baker and Sinclair were directors at Trilogy when China’s Citic Capital Partners took over the company to the tune of $211m in 2018.

Hannah Barrett, Beauden Barrett’s wife, also sits on the board, joining in April 2020.

Refinancing and upsides

Me Today told the market it plans to hold a shareholder meeting on March 8 to recapitalise.

It is seeking approval from shareholders to raise $2.78m in new capital at $0.08 a share, 1 cent above the current trading price.

The refinancing comes at a time when the company has signed a new licensing agreement with a large “Chinese sports nutrition company” and a deal with a US grocery chain that agreed “to stock the Me Today Skincare range in their 400 stores from late April”, the release said.

Sinclair did not want to disclose the identity of the US company.

“We don’t want our opposition knowing,” he said.