Elixinol Finds Non-compliant CBD Products at Japanese Subsidiary

The company has now launched an investigation to reveal how the non-compliant products got into the facility, with hopes to complete the review by mid-November.

Elixinol Global (ASX:EXL,OTCQX:ELLXF) has discovered that non-compliant hemp-derived cannabidiol (CBD) products were being sold by its subsidiary Elixinol Japan.

Last Wednesday (October 23), the New South Wales-based cannabis company informed investors that the breach was found during a recent review of the company's individual business units.

“The non-compliance relates to the strict requirements in Japan on sourcing CBD from only hemp stalk and seed," the company said in a statement.

The company has now launched an investigation, aided by an undisclosed independent legal expert, to reveal how the non-compliant products got into the facility. Elixinol Global said that it hopes to complete the review by mid-November.

In an email statement to the Investing News Network, Ron Dufficy, CFO at Elixinol Global, declined to comment on the situation until the case is complete.

As a part of the investigation, Elixinol Global plans on assessing the commercial viability of the CBD business at its operation in Japan, telling investors they should expect a market update once the firm completes its evaluation.

During H1 of the 2019 fiscal year, Elixinol Japan brought in AU$1.6 million in revenue, representing 8.7 percent of Elixinol Group's AU$18.3 million in group pro forma revenue.

Elixinol Global slumps on Q3 results

Shares of Elixinol Global took a hit during the trading day on Wednesday (October 30) after the company released its results for the third fiscal quarter on Tuesday (October 29).

The firm fell 5.7 percent early in the trading day to AU$1.53. The company has experienced a drop year-to-date of 43 percent from a price of AU$2.69.

During the third quarter, Elixinol Global's group revenue dropped 3 percent from the previous quarter to AU$9.6 million.

The next quarter could see cash outflows of AU$24.2 million, the company estimates.

In Q2, the company boasted a cash balance of AU$48.1 million, which has since dropped to AU$34.3 million due in part to operating costs of AU$11.4 million.

In a statement, Stratos Karousos, CEO of Elixinol Global, said the company plans to continue focusing on diversifying its business and making further investments in the global cannabis market.

“We remain very confident in our future growth strategy as we continue to diversify our branded product mix through a multi-channel sales approach," the executive said.

Don't forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Danielle Edwards, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

AU$4 Billion Galaxy/Orocobre Merger to Create Top 5 Lithium Company

Australia’s Orocobre (TSX:ORL,ASX:ORE) and Galaxy Resources (ASX:GXY,OTC Pink:GALXF) agreed this week to join forces in a AU$4 billion “merger of equals.” The deal comes as demand for lithium for electric vehicle (EV) batteries continues to pick up pace.

Once the merger is complete, the new company will become a top five lithium chemicals company globally — and top three outside of China — with production capacity of around 40,000 tonnes of lithium carbonate equivalent per year.

“The merged entity’s growth opportunities in both brine and hard rock position it uniquely to take advantage of expected rising EV demand for lithium,” Galaxy Chairman Martin Rowley said.

Keep reading... Show less

IIROC Trading Halt – TMRR

The following issues have been halted by IIROC:

Company: Tempus Resources Ltd.

Keep reading... Show less

Cleantech Investing in Australia

Climate change is a looming issue for Australians, with 82 percent concerned about bushfires and 81 percent worried that drought or flooding will affect crop production and food supply.

This is where conscious investors look to the cleantech sector, which covers everything from renewable energy to low-emission technologies to water technology to battery storage and more.

What should investors know about cleantech in Australia before they jump in? Read on for a look at key factors, including market size, the industries encompassed by cleantech and big players to watch.

Keep reading... Show less

Galaxy Resources Limited Announcement

Galaxy Resources Limited (ASX: GXY) ( Company ) advises that the following announcement has been made to the Australian Securities Exchange which appears on the Company’s platform (ASX):

  • Becoming a substantial holder

The announcement can be viewed at:
https://www2.asx.com.au/markets/trade-our-cash-market/announcements.gxy

Keep reading... Show less

Hastings Technology Metals Ltd Signs Major Offtake Contract with thyssenkrupp

Perth, Australia (ABN Newswire) – Australia’s next rare earths producer Hastings Technology Metals Limited (ASX:HAS) is pleased to announce that it has executed a binding offtake contract with thyssenkrupp Materials Trading GmbH (TK), for high-grade mixed rare earth carbonate (MREC) from the Company’s Yangibana Rare Earths Project (Yangibana) in the Gascoyne region of Western Australia.

Highlights

– Hastings announces signing of a major offtake contract for the supply of its high grade product from its Yangibana Rare Earths Project in Western Australia to thyssenkrupp Materials Trading GmbH.

Keep reading... Show less

Top News

Related News