Wellnex Life opens share purchase plan to continue ‘significant momentum’ in FY2023 growth
Capital raising funds will advance Wellnex’s goal of being one of the first companies to offer an over-the-counter medical cannabis product in Australia under joint venture with OneLife Botanicals.
Wellnex Life (ASX: WNX) plans to raise $2 million under a share purchase plan launched today to maintain the record growth momentum it has achieved so far in FY2023, including its goal of being one of the first companies to offer an over-the-counter medical cannabis product in Australia.
The share purchase plan aims to raise $2 million at $0.075 per share, which is a 19.7% discount to Wellnex’s five-day volume-weighted average price (VWAP).
“We are pleased to provide our shareholders with the opportunity to participate in this share purchase plan by purchasing additional shares at a modestly discounted price without incurring brokerage or transaction costs,” Mr Karafotias said.
The funds raised will go towards helping Wellnex advance its joint venture with OneLife Botanicals, with Wellnex aiming to be one of the first companies to launch an over-the-counter medicinal cannabis product in Australia.
“Our joint venture with OneLife Botanicals, combined with our key competencies around regulatory know-how and distribution networks, provide us with all the ingredients required to evolve as a major player in this large and fast-growing market,” he said.
Wellnex is hoping to capitalise on the rising awareness of cannabidiol (CBD) and the health benefits it has, along with its effectiveness in pain management and other treatments.
Funds from the capital raising will also help build the inventory required for launching new products, accelerating other growth avenues and cover the cost of the raising.
The SPP opened on Wednesday 14 September and will close on Wednesday 5 October.
Mr Karafotias said the SPP was timely to help Wellnex continue its record growth momentum.
“This capital raise comes at an important inflection point for the business where we are presented with multiple growth opportunities, the largest of which likely related to our chance to be one of the first companies to offer an over-the-counter medical cannabis product in the Australian S3 market,” he explained.
The company hopes to sell the medicinal cannabis product in FY2023 under the Therapeutic Goods Administration’s special access scheme. This is expected to lead to eventual over-the-counter sales.
More brand and product launches coming
In addition to its first over-the-counter medical cannabis offering, Wellnex has a strong pipeline of brand and product launches to further drive revenue and margins throughout FY2023.
The company’s Mark Wahlberg’s Performance Inspired sports supplements will be available at Chemist Warehouse stores nationally next month.
Also, through Chemist Warehouse in October, the launch of Australia’s first organic A2 infant formula product, Ocean Road Dairies, will take place, as part of a JV with Australian Dairy Nutritionals (AHF).
Wellnex also recently announced its acquisition of teeth whitening brand, Mr Bright.
Another initiative in the pipeline is Wellnex’s Pharmacy Own brand in an exclusive deal with Australian pharmaceutical and medical consumable distributor Clifford Hallam Healthcare (CH2).
Strong start to FY2023
After a strong start to FY2023 in July and August, Mr Karafotias said the company expects first quarter revenue will come in at $6.8 million – up 78% on Q1 FY2022 levels.
Adding to the strong start to FY2023, budgeted revenue for September 2022 is estimated $2.9 million, a rise of 141% compared to September 2021.
Additionally, Wellnex noted it received “significant contract manufacturing purchase orders” in September, with total purchase orders outstanding of about $3 million, which will be invoiced in the next quarter.
The health and wellness company said Q1 FY2023 was shaping up as a “record-breaking quarter” – helping it meet its guidance of $29 million in revenue for the financial year.
Mr Karafotias said the company aims to maintain this growth momentum over the following months.
“We are seeking to maintain this momentum with multiple exciting brand and product launches planned over the coming months to propel the company forward and create value for shareholders.”