MOU with Accolade Packaging stands out in Skin Elements (ASX: SKN) March quarter report - Kalkine Media

Highlights

• After positive trial of Eco Nurture by Accolade Packaging Limited, SKN and Accolade Packaging have signed an MOU
• The company received Research & Development (R&D) rebate amounting to AU$178,000 during the March 2023 quarter
• In April 2023, the company lodged a prospectus for a non-renounceable pro-rata entitlement issue

Skin Elements Limited (ASX: SKN), which is into the health care sector with its natural and organic products, has released its quarterly activities report for the three-month period ended 31 March 2023. Notably, the company has plant-based and organic personal care and skincare products that have a global demand and distribution.

One of the highlights of the last quarter was Eco Nurture, which is based on SKN's SE Formula technology development program.

More on bio stimulant Eco Nurture, the recently signed MOU, Skin Elements' research & development rebate and other highlights of the March 2023 quarter is in the following paragraphs.

Development of Eco Nurture and MOU in New Zealand

The product is a sustainable horticultural specific plant bio stimulant, which can improve the overall health of the plant, thanks to how it works and triggers better tolerance to stress, says the company. Eco Nurture is the product of the SE Formula technology, into which Skin Elements is undertaking more research. In the reported quarter, the company partnered with Accolade Packaging Limited. The latter is an NZ-based company, which has reported positive trial of Eco Nurture in kiwifruit vines.

The trial could demonstrate better stress tolerance, wellness, and natural resilience. The MOU between the two companies would enable both to negotiate legally binding commercial terms with respect to exclusive distribution of the product in NZ and other jurisdictions. Notably, Eco Nurture has a class determination from New Zealand Food Safety as an agricultural compound, making it exempt from registration under the ACVM Act.

SKN states that the positive completion of initial assessments of Eco Nurture would position the plant bio stimulant in a market that supports "multi-billion-dollar food crop industries".

Source: Company update dated 28 April 2023

SuprCuvr Distribution Agreement

The quarterly report mentions submission by Pacific Health Care Pty Ltd of SuprCuvr on its formal tender lists, with utility as a hospital-grade disinfectant. Pacific Health is pursuing opportunities for sale of SuprCuvr with the governments of Queensland, New South Wales, and Victoria, alongside presenting it to key private hospitals in Western Australia and other states.

Research & Development Rebate

Skin Elements received Research & Development (R&D) rebate amounting to AU$178,000 during the March 2023 quarter, which was the expenditure on R&D activities during the December 2022 quarter. 

The company has stated that a rebate of AU$180,000 (expenditure during the March 2023 quarter) is expected in May 2023.

SKN has an equity funding facility agreement with LDA Capital with provision for up to AU$20 million in committed equity capital, but Skin Elements did not make any drawdown during the March 2023 quarter.

Entitlement Issue

Last month, Skin Elements announced a non-renounceable pro-rata entitlement issue (one new share for every five ordinary shares), with issue price as AU$0.01 per new share. This comes with an attaching option (exercise price AU$0.025, and expiry date of three years) for each new SKN share. Prospectus has been mailed to eligible shareholders, and SKN has said that 708 Capital Pty Ltd has fully underwritten the proposed entitlement issue. Read more.

SKN shares traded at AU$0.013 on ASX on 2 May 2023. Skin Element’s market cap was over AU$6 million.