Elixinol Cuts A$1 Million Earnout, Sees 27% Sales Growth in Healthy Chef
Elixinol Wellness has amended acquisition terms for The Healthy Chef after its US distributor exited, reducing earnout payments and refocusing growth efforts on Australia.
- US distribution partner withdrawal leads to revised acquisition terms
- Earnout payments reduced by A$1 million
- Australia becomes primary growth market for The Healthy Chef
- November sales show 27% year-on-year growth
- Focus on profitable revenue and margin expansion across portfolio
Context of the Revision
Elixinol Wellness Ltd (ASX, EXL) has announced a significant update to its acquisition terms for The Healthy Chef, a brand it acquired in October 2024. The revision follows the unexpected withdrawal of The Healthy Chef’s US distribution partner, which had previously guaranteed minimum revenues under their agreement. This development prompted Elixinol to renegotiate the earnout structure with the vendors, who remain committed shareholders.
Financial and Strategic Implications
The renegotiated terms reduce future earnout payments by A$1 million, a move that materially strengthens Elixinol’s balance sheet and liquidity position. By easing financial liabilities, the company is better positioned to allocate capital towards markets with higher return potential, notably shifting its focus to Australia as the primary growth engine for The Healthy Chef brand.
Operational Momentum in Australia
Integration of The Healthy Chef into Elixinol’s portfolio is now complete, and early indicators are promising. November 2025 saw a robust 27% year-on-year growth in sales for The Healthy Chef, driven largely by a successful cyber sales period and an enhanced direct-to-consumer channel. This momentum validates Elixinol’s strategic decision to prioritize the Australian market and invest in strengthening its retail and e-commerce presence.
Broader Portfolio Focus
Beyond The Healthy Chef, Elixinol continues to emphasize profitable revenue growth, disciplined cost management, and improvements in gross margin mix across its other brands, including Hemp Foods Australia. These efforts align with the company’s FY26 strategic agenda aimed at sustainable margin expansion and long-term shareholder value creation.
Looking Ahead
With a clearer capital allocation strategy and a stronger balance sheet, Elixinol is well-positioned to accelerate growth in its home market. The company’s ability to adapt to the loss of its US distribution partner and refocus on higher-margin opportunities highlights its operational resilience and strategic agility in a competitive health and wellness sector.
Bottom Line?
Elixinol’s recalibrated Healthy Chef deal sets the stage for focused growth and improved financial health.
Questions in the middle?
- How will Elixinol address the lost US market revenue long term?
- What specific initiatives will drive margin expansion across the portfolio?
- Can the strong Australian momentum sustain through FY26 and beyond?
