Neogen Bioactives - Financial Model (Appendix B)

Revenue Projections

Two-path financial model showing conservative base case (organic DTC growth) and upside optionality (celebrity-accelerated growth). Select path to view corresponding metrics.

Figure B-1. 5-Year Revenue Projection

Unit Economics

Core metrics driving Path A and Path B financial models. All values reflect blended channels and portfolio averages across five-year period.

Average Order Value

$223

Blended across all products

Customer Acquisition Cost (Y1)

$70

Path A Year 1

Customer Lifetime Value (3-yr)

$520

Path A

LTV:CAC Ratio

7.4x

Path A

Year 1 Gross Margin

46%

Both paths

Year 5 Gross Margin

53%

Path A

COGS Analysis

Product-level margin structure. Premium creams face elevated peptide costs; serums balance potency with cost efficiency.

Figure B-2. Gross Margin by Product Category

Table B-1. COGS Breakdown by Product Category

Product Category	Gross Margin Range	Key Driver	Portfolio Weight
Cleansers & Essences	48–50%	Lower botanical extract cost	25%
Serums (Radiance, Clarity, etc.)	44–46%	Higher-value botanical ingredients	45%
Premium Creams (Peptide, Reparative)	42–44%	Elevated peptide & rare extract COGS	30%
Weighted Portfolio Average	45%	Blended across all products

Use of $2.5M Base Facility

Capital allocation across product development, marketing, operations, and working capital through cash-flow breakeven (Month 16–18).

Figure B-3. Allocation by Function

Sensitivity Analysis

Year 5 revenue under conservative, base, and aggressive scenarios. Conservative case reflects 15% elevated CAC and 20% lower repeat rates; aggressive case assumes 20% lower CAC and 35% repeat rates.

Table B-2. Sensitivity Analysis — Path A

Path A: Base Case (Organic DTC)	Year 5 Revenue	EBITDA Margin	Breakeven (Month)
Conservative	$22.5M	20–22%	Month 18–20
Base Case	$28.5M	24–26%	Month 14–16
Aggressive	$35.8M	28–30%	Month 11–13

Table B-3. Sensitivity Analysis — Path B

Path B: Upside Case (Celebrity-Accelerated)	Year 5 Revenue	EBITDA Margin	Breakeven (Month)
Conservative	$38.6M	22–24%	Month 16–18
Base Case	$48.5M	26–28%	Month 12–14
Aggressive	$61.2M	30–32%	Month 9–11

Key Milestones

Timeline to profitability and operational maturity. Timing varies by path, reflecting different customer acquisition velocity and repeat purchase rates.

Month 6: Gross Profit Positive

First revenue fully covers cost of goods sold. Both paths achieve positive unit economics by Month 6 post-launch.

Month 12–14: Operating Profit (Path B)

Path B achieves EBITDA break-even due to elevated repeat rates (42% Year 1) and lower CAC payback period (14–16 months versus 18–20 months Path A).

Month 14–16: Operating Profit (Path A)

Path A reaches EBITDA breakeven as repeat customer base grows and blended CAC declines from $70 to $55 through improved channel efficiency.

Month 18–24: Free Cash Flow Positive

Both paths achieve sustained free cash flow as operating margin expands and working capital requirements stabilize.

Year 2 End: Retail Partnership Ramp

Wholesale channel (Sephora, Ulta, Net-A-Porter) contributes 15–20% of Year 2 revenue, scaling to 25–30% by Year 3 end.

Year 3: Biotech Integration Milestone

First biotech ingredients (engineered peptides, domestic actives) deployed in formulation updates. Tariff exposure reduced from 12% to 7–8% of COGS.

Financial Assumptions

Core drivers underlying both Path A and Path B financial models. All figures reflect conservative blended estimates across multi-channel DTC operations.

Revenue & Growth

Y1 target: $950K–$1.35M

Y1 CAC: $65–$75 (Path A) / $80–$95 (Path B)

CAC decline Y1→Y3: 20–30%

Repeat rate Y1: 28–32% (Path A) / 40–45% (Path B)

Repeat rate Y3: 35–40% (Path A) / 50–55% (Path B)

Gross Margin & COGS

Y1 gross margin: 46% (both paths)

Y3 gross margin: 48% (both paths)

Y5 gross margin: 50–53% (Path A) / 53–54% (Path B)

Weighted avg COGS: 45% of retail price

COGS reduction by Y2: 3–5% via scaling

Operating Costs

Marketing Y1: 40–45% of revenue

Marketing Y3: 20–25% of revenue

Payroll Y1: 8–10% of revenue

Fulfillment & logistics: 8–12% of revenue

Platform & tech: 2–3% of revenue

Unit Economics

AOV: $223 blended (Y1)

AOV growth: $223 → $280–$320 (Y3)

LTV (3-year): $520 (Path A) / $785 (Path B)

LTV:CAC: 7.4x (Path A) / 9.0x (Path B)

CAC payback: 8–12 months

Channel Mix & Growth

Y1: 100% DTC (Shopify, Instagram, TikTok)

Y2: 15–20% retail wholesale

Y3: 25–30% retail wholesale

Y5: 30–35% retail wholesale (projected)

Retail partners: Sephora, Ulta, Net-A-Porter, Credo

Financing Terms (RBF)

Base facility: $2.5M

Revenue share: 8% monthly gross revenue

Return cap: 2.0x capital ($5M)

Term: 96 months (standard RBF)

Upsize option: $3.5M available at M12–18

Neogen Bioactives Financial Model | Appendix B | Revised April 2026
This model represents conservative estimates based on industry benchmarks and company-specific operational data. Actual results may vary materially. This document is for authorized recipients only.