Elixinol Global confirms AUD 2.6-million land purchase for subsidiary Nunyara

EXL

The Sydney, Australia-based Elixinol Global Limited (ASX: EXL) has a global business presence in the cannabis industry. The company is engaged in the manufacturing and distribution of industrial hemp-based dietary supplements and foods, skincare products and medicinal cannabis worldwide. Its subsidiaries comprise – Hemp Foods Australia operating as a hemp food manufacturer, wholesaler, retailer and exporter of an extensive product range throughout southern hemisphere; and Elixinol USA, established in 2014, and one of the world’s reputed hemp-derived cannabidiol (CBD) brands based out of Colorado.

In a series of latest announcements, EXL has confirmed the rename of its third subsidiary Elixinol Australia, to Nunyara Pharma Pty Ltd. This was accompanied by another significant declaration highlighting purchase of a site for USD2.6 million in the Northern Rivers District of New South Wales for commercial cannabis cultivation and manufacturing for Nunyara. 

Nunyara was established in 2014 to leverage domestic and export opportunities in the emerging Australian medicinal cannabis market and applied to the local council as well as the Office of Drug Control (ODC) in early 2018, seeking a license for cultivation and manufacturing. As of now, both the applications are under review and pending consent.

Despite the lag in receiving licenses, the company has been diligently progressing in its efforts to acquire an integrated state-of-the-art cultivation and manufacturing facility to immediately start the production as the legal formalities are resolved. The site spans 60-acre. Under stage one as planned, a 5,000 sqm footprint on a secured 4.9-acre stretch will be developed within the 60-acre lot, with significant capacity to expand and construct the proposed greenhouses as required.

The company recently released its Business review and cash flow statement for the quarter ended December 31st, 2018. The unaudited figures depict sustained uptrend with reported group revenue at AUD 11.9 million For Q4 FY2018, indicating 14% growth with respect to Q3 FY2018. The full year FY2018 revenue stands at AUD 37.2 million, a rise of 121% over FY2017 of AUD 16.8 million. Capital expenditures for Q4 FY2018 were posted at AUD 3.3 million.

Besides, the net increase in cash and cash equivalents was at AUD42.92 million at the end of Q4 FY2018 while the gross cash outflows for Q1 FY2019 are estimated at AUD 22.0 million.

EXL is on a geographical expansion spree at the backdrop of strong momentum building in the global cannabis industry. It is expected to capture a significant market share by differentiating the medical cannabis activities through this subsidiary, which follows its recent initiative to drive growth across Europe including new sales hubs in Netherlands, Span and United Kingdom. Besides, it has employed a direct sales force, launched an e-commerce site and infrastructure in Europe.

With a divorce portfolio of products and a market capitalisation of AUD 409.77 million, EXL is listed on the ASX with ~124.55 million outstanding shares. On Thursday, February 7th, 2019, the shares of the stock were trading at AUD 3.110, down 5.471%.


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