Next Investors logo grey

Creso negotiates maiden distribution agreement that will bring immediate revenue and cash flow


Published 31-OCT-2016 13:28 P.M.


3 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.

Click Here to View Latest Articles

Creso Pharma (ASX: CPH) has negotiated its first distribution agreement which will facilitate sales of its self-produced food supplement hemp product, CBDium.

The agreement with MEDI-IN s.r.o. will generate immediate revenue and cash flow, and will see the company’s bottled, hemp extract-based food supplement distributed in the Czech Republic via more than 300 retail outlets, including pharmacy chains.

With many players in the pharmaceutical industry only at trial stage and well short of being in a position to supply end markets, this is a significant development for CPH.

In particular it provides the company with a notable point of difference, compared with the many new entrants that are having a tilt at the cannabis medicinal industry due to the expectation of strong growth as applications broaden and acceptance increases.

Next Investors Image

As at October 31, 2016, CPH’s market capitalisation is circa $10 million as its share price has retraced since the above data was compiled.

Share price retracement could be buying opportunity

CPH has performed strongly since listing on the ASX less than two weeks ago with its share price hitting a high of 39 cents last week before retracing to circa 30 cents. This implies a 50% premium to the group’s IPO price of 20 cents.

Potential investors should note that share price trends may not be replicated and as such should not alone be used as the basis for an investment decision. Furthermore, independent financial advice should be sought if considering an investment in CPH.

As part of the agreement, MEDI-IN s.r.o. is committed to perform extensive marketing activities relating to the sale of CBDium in the Czech Republic, including but not limited to e-commerce and direct marketing to retail stores.

MEDI-IN has extensive market reach

CPH Chief Executive and co-founder Doctor Miri Halperin Wernli, commented, “Hemp-based CBD is providing us with the nutritional support to maintain and regain health and wellness.”

CPH’s chairman and co-founder Boaz Wachtel, highlighted the fact that MEDI-IN was a first-tier distributor with experience in supplying natural medications, as well as medical equipment to hospitals, pharmacies, sports and food stores. With experience in marketing to a wide range of industry representatives across the health and well-being spectrum, the group looks to be a perfect partner for CPH.

In providing some background to this development Wachtel said, “This agreement was only made possible through Creso Pharma’s acquisition of Slovakia based Hemp-Industries and it marks an important milestone for the company, bringing both immediate revenue and cash flow to our newly listed company, as well as first exposure in the EU market for our products”.

More distribution agreements to follow

Wachtel said he is expecting strong demand and rapid growth in the European market and has flagged this agreement as the first of many partnerships which will assist in expanding the group’s distribution network into additional markets.

CPH has numerous strings to its bow with other cannabis derived therapeutic grade nutraceutical products being developed in Switzerland which have applications in improving the health and well-being of both humans and animals.

This development comes less than a week after the company announced that it had entered into a Letter of Intent with Swiss Pharma company, Streuli Pharma, for the commercialisation of cannabis and hemp based nutraceutical products based on CPH’s proprietary INNutri Soft Gums technology.

General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.