NEXE Innovations Inc (TSX-V:NEXE, OTC:NEXNF) said it is continuing to make progress on transitioning to a vertically integrated process, including manufacturing components in-house, as it released financial results for the three months ended August 31, 2022.
"We are pleased with the progress we continue to make as we transition from R&D to production. We are engaged in several conversations with potential clients in both Canada and the US", Ash Guglani, the company's president said in a statement.
"The 54,000 square feet Windsor facility is on track to be operational by year-end and we are receiving a lot of employment interest and excitement from the local community," he added.
READ: NEXE Innovations focused on growing its customer base after cementing its operational footprint in fiscal 2022
The capacity provided at the new Windsor facility is expected to be key to securing large commercial contracts and to working with private label and co-manufacturing CPG companies, Nexe said, adding that the vertically integrated manufacturing process has many benefits from reducing supply chain risk, providing greater quality control and reducing operational costs.
Additionally, costs are expected to further benefit as operations scale and as material costs will be locally sourced, the company said.
A key priority is to build a strong customer base focusing on the private label and co-manufacturing segments of the market, the company noted, adding that it is currently in active discussions with several potential clients within the co-manufacturing and private label segments to fill its capacity as it comes online.
Recently, NEXE signed its first US purchase order as part of a partnership with Awaken Brands Ventures Ltd, under which the company will provide its fully compostable and proprietary pod for Awaken Brands' "ecobeans coffee" and "Urban Hippie" product lines.
During the three months ended August 31, 2022, the company recorded a net loss of $1,949,860 or $0.02 per share, compared to a net loss of $2,016,955, or $0.02 per share, for the comparable period last year.
As of August 31, 2022, the company had working capital of $28,588,131 with cash and cash equivalents totaling $12,176,298. NEXE is fully funded with $25.2 million in cash and Guaranteed Investment Contracts to weather the increased market volatility and focus on executing its strategy over the next 12-18 months.
NEXE Innovations is a leader in innovative compostable materials technology based in British Columbia, Canada. The first product developed by NEXE Innovations is one of the only patented, fully-compostable, single-serve coffee pods for use in existing major single-serve coffee machines.
Contact the author at jon.hopkins@proactiveinvestors.com