Neptune Wellness Signs $16.5M Extraction Partnership
Neptune Wellness Solutions Inc. (NASDAQ:NEPT) (TSX:NEPT) reported Tuesday it has signed a $16.5 million deal that will see the Canadian CBD extraction company process up to 44,000 kilograms of crude and distillate from hemp.
The processing will span six months and take place at Neptune's 50,000-square-foot Sherbrooke, Quebec facility.
Last month, the Laval, Quebec-headquartered company announced its phase II expansion at Sherbrooke production facility is set for operation and licensed to conduct production, reaching a capacity of 200,000 kg.
"We are pleased to enter into this game changing hemp processing partnership, which further strengthens our B2B extraction business and allows Neptune to deliver high quality, low-cost hemp extracts to our customers," said Neptune's COO David Mayers in a statement.
Neptune CEO Michael Cammarata also praised the agreement. A Phase II expansion at the Quebec facility will improve the company's competitiveness with "the edge to win at retail in Cannabis 2.0," he said.
"This is an exciting point in time for Neptune's history with accelerated growth across our health and wellness product portfolio, including cannabis and hemp-derived products," Cammarata added.
The company also manages a 24,000 square-foot facility located in North Carolina.
In April, Neptune announced its collaboration with the environmentalist, Dr. Jane Goodall, on developing natural health and wellness products for its Forest Remedies brand.
Last week, the company released its preliminary financial results for the 2020 fiscal year, disclosing it expects to yield a revenue of approximately $28 million to $29.6 million.
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