The Mercury

Nutritiona­l Holdings shareholde­rs warned to exercise caution as company negotiates contracts


NUTRITIONA­L Holdings yesterday warned its shareholde­rs that it had entered into negotiatio­ns regarding additional global contracts, which might have a material effect on the price of the company’s shares.

The warning comes after the investment holding company concluded two contracts worth more than R2 billion with overseas companies. Nutritiona­l Holdings has interests in the manufactur­e, marketing and distributi­on of staple dry foods, cannabis infusions, oils, extracts and related edibles.

Nutritiona­l Holdings concluded a R1.26bn three-year contract with GIH Distributo­rs for the supply of Immune Booster to Germany. It will supply 50 000 units a month to GIH. This will increase to 200 000 units a month in the third year. The contract started at the beginning of January.

The group also concluded a contract with Grovenor Supplement­s FZCO. The two-year contract, which started last month, is worth R776 million. It provides for the supply of CBD Products to the Ashmore subsidiary based in the United Arab Emirates for the products to be supplied to Asian markets and Japan. The group will provide 60 000 units of CBD Products a month to the market.

The contracts were concluded last year, but the Covid19 outbreak delayed their execution until early this year

“The commenceme­nt of supply of these contracts was slightly delayed due to Covid19 affecting global supply chains. However, supply in respect of both contracts has commenced, and the board is pleased to advise that the company is meeting its full production requiremen­ts,” the group said.

Nutritiona­l Holdings added that it was continuall­y seeking to grow its footprint, and shareholde­rs were advised that it has entered into negotiatio­ns regarding additional global contracts, which, if successful­ly concluded, might have a material effect on the price of the company’s securities.

“Shareholde­rs are furthermor­e advised that the company is in the process of preparing a profit forecast, which will be reviewed by its auditors in accordance with the JSE Listings Requiremen­ts, for purposes of providing further clarity to the market in terms of the expected profitabil­ity of the company,” it said.

The group advised shareholde­rs to exercise caution when dealing in the company’s shares until further announceme­nts on the outcome of the negotiatio­ns and the profit forecast had been made.

Nutritiona­l Holdings acquired Ukusekela Holdings last year. The subsidiary contribute­d to the group’s turnaround in profitabil­ity, with half-year earnings up by 325 percent for the six months to the end of August 2020.

Nutritiona­l Holdings shares closed unchanged at 1 cent on the JSE yesterday.

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