SOIL SUB WINS ANOTHER CONTRACT WORTH $4.5 MILLION PER YEAR
The Board of Soil Sub Technologies Limited (“Soil Sub” or the “Company”) is pleased to announce the execution of a contract for the sale of additional NutriMix® product into China. The contract is with Hong Kong based Timms Cho Group Limited. Under the terms of the new contract, the Company will receive a royalty of 7.5% of gross sale which equates to in excess of A$15 per tonne of product sold. Sales by Timms Cho are expected to commence immediately. Sales will be made up of bulk sales to the horticulture and landscape market as well as packaged product for retail distribution. Timms Cho expect sales of at least 190,000 tonnes in the first year, rising to over 300,000 tonnes per year. The contract is for exclusive supply for a period of up to 20 years. Executive Chairman of Soil Sub Graeme Scott said “This agreement is very exciting news for Soil Sub. Alliances with companies who can deliver results in their territories illustrates our strategy for development of key markets under our current business plans and with our operating structure.” “At $15 per tonne on 190,000 tonnes, revenue under the extension contract will be at least $2.85 million in the first year, rising to $4.5 million per year, and it is anticipated that volumes will further increase in future periods. As the revenue is by way of royalty, additional costs to the Company will be negligible. The Company also plans to expand commercialisation of NutriMix® to Middle East,Europe, Africa and Australia
SOI Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
