VANCOUVER, BC, Canada – NEXE Innovations Inc., a leader in innovative compostable materials technology based in British Columbia, Canada, released the following end-of-year press release, with an update on its new production site in Windsor, Ontario.
“As we close out 2022, we reflect on what we have accomplished to date – the launch of our disruptive and proprietary fully compostable single-serve coffee pod and transitioning from an outsourced manufacturing process to an in-house component manufacturing process.
In January 2022, NEXE purchased a 54,000 square foot facility in Windsor, Ontario to support the development of a vertically integrated manufacturing operation. With a focus on de-risking the supply chain and improving our margins, we continue to work with world class vendors and integrators to develop processes for our highly customized equipment to manufacture key components in-house. Once complete, we expect to control our manufacturing process end to end.
There are numerous advantages of transitioning to a vertically integrated operation and onshoring, including limited supply chain risks, protecting our IP, higher operating margins, and lowering our carbon footprint. One key advantage has been to accelerate the R&D process in-house, which has led to additional enhancements to our compostable materials, resulting in the NEXE pod composting in as little as 17 days, down from 35 days in an industrial composting facility.
We are targeting to be in production early 2023 in the Windsor facility, with both component and finished goods manufacturing. With the hiring of Chris Murray, an experienced senior sales leader, the main areas of focus for 2023 will be scaling our operations and sales.
Chris has 20+ years of extensive experience in the coffee and consumer packaged goods (CPG) industry in Canada and the U.S. NEXE is currently in active discussions with various potential customers.
A key part of our sales strategy is to target private label and co-manufacturing segments of the market to reliably fill our production capacity as it comes online. By the end of 2024, we expect the Company to have a total production capacity of ~500 million units per year for the coffee segment.
The fully compostable packaging market is still in its infancy stage. Consumer’s preferences are changing, and they are willing to pay more for sustainable options. The capacity to meet this increasing industry demand for compostable packaging is limited. The new Windsor facility and vertically integrated operations will strengthen NEXE’s position within the industry and allow us to build on our manufacturing expertise and operational footprint.
We expect 2023 will be a pivotal year as our scaled production comes online. We maintain a strong balance sheet with ~$28 million in working capital and minimal debt to support our operations as we scale and start to generate sales. On behalf of the entire management team, we would like to extend a big thank you to all our employees, customers, shareholders, and other stakeholders. May you all have a wonderful holiday season and a happy and healthy 2023.