NEXE Innovations (NEXE.V): XOMA God! NEXE Receives First XOMA Order

NEXE Broadens Its Horizons

$52.292M Market Capitalization

NEXE Innovations Inc. (NEXE.V) announced today retail distribution for five of the Company’s XOMA Superfoods beverages into PSC Natural Foods, a part of Horizon Distributors Ltd. PSC placed their first purchase order for all five varieties of NEXE’s XOMA Superfoods line including Cocoa Keto, Coffee with MCT, Keto Coffee, Matcha, and Turmeric. For context, XOMA Superfoods is a subsidiary of NEXE.

“We are excited to partner with PSC to provide consumers access to our nutrient-dense, fully compostable and Keurig® single-serve brewing systems compatible superfood beverages,” said Ash Guglani, President of NEXE.

PSC Natural Foods represents Vancouver Island’s leading distributor of natural and organic products, ranging from household products to groceries. With this in mind, PSC distributes to grocery chains, independent retailers, natural food stores, pharmacies, buying clubs, restaurants, cafes, institutions, and specialty retailers. PSC also boasts a network of over 200 stores serving Vancouver Island and the Lower Mainland in British Columbia (BC).

XOMA Superfoods

XOMA comes from the Greek word for soil or earth. With this in mind, NEXE’s XOMA Superfoods products are intended to provide a more ethical, sustainable, and eco-friendly way to consume coffee. All of XOMA Superfoods products are packaged in the Company’s fully-compostable, plant-based NEXE pods, which recently became available on NEXE’s website, nexecoffee.com, and are compatible with Keurig® single-serve brewing systems.

Products:

Coffee with MCT: medium-chain triglycerides (MCT) made from virgin coconut oil, offering health and energy benefits
Keto Coffee: made with quality fats from cocoa butter and MCT oil, ideal for a ketogenic diet, fasting regimen, or as part of a healthy lifestyle
Turmeric Golden Milk: made using turmeric and ginger, intended to provide numerous benefits including improved heart health, digestion, and memory
Matcha Latte: finely-ground, shade-grown green tea leaves packed with antioxidants for decreased stress and increased alertness
Cocoa Keto: rich, dark, cocoa flavor, along with reported health benefits to the immune system, heart, muscles, nerves, and brain

You know how it goes. More often than not, wellness products rely on “potential benefits” to support sales. In reality, most of these claims aren’t supported by any clinical evidence and are essentially bullshit. However, I would argue that the selling point of NEXE’s XOMA Superfoods products doesn’t rely on potential benefits. Instead, I believe XOMA Superfoods’ sales are largely driven by NEXE’s business model centered around its compostable coffee pods.

“Our fully compostable pods have been introduced at a key time when our competitors are being fined for greenwashing and worldwide legislation is continually being introduced against single-use plastics. Our NEXE beverage pods can be disposed of immediately after use, leave no mess, and do not need to be disassembled before composting, making it convenient to integrate more plant-based products into your life. The pods could break down completely in municipal compost facilities in as few as 35 days,” added Ash Guglani.

A survey conducted by Ipsos in conjunction with Plastic Free July revealed that an average of three-quarters of people across 28 countries agree that single-use plastic should be banned as soon as possible. Latin America and BRIC countries, namely Brazil, Russia, India, and China, showed the highest level of agreement, at 88% and 80% respectively.

On the contrary, North America had the lowest levels of agreement at 61%. Unfortunately for North Americans like myself, we don’t have a choice. According to the National Conference of State Legislature, California, Connecticut, Delaware, Hawaii, Maine, New York, Oregon, and Vermont have imposed single-use plastic bans. Closer to home, Canada’s single-use plastic ban represents a significant step towards the country’s goal of zero plastic waste by 2030.

With this in mind, there has never been a better time to be one of the world’s first compostable coffee pod brands. As coffee pod companies like Nespresso SA, Kraft Heinz, Nestle SA, Luigi Lavazza SPA are driven into a corner with every new plastic ban, opportunities open up for companies like NEXE. Supported by a strong portfolio of compostable coffee pods, including Nespresso and Keurig compatible pods, NEXE is well-positioned to capitalize on a growing need for plastic coffee pod alternatives.

That being said, given the Company’s strong manufacturing capabilities, NEXE could easily manufacture compostable coffee pods for companies looking for eco-friendly options. On January 27, 2022, the Company announced that it had completed the acquisition of a 54,000 square foot industrial facility located in Windsor, Ontario, which will significantly expand NEXE’s production capacity.

Furthermore, on January 20, 2021, NEXE announced the expansion of its research, development, and manufacturing facility in Surrey, BC. This expansion doubled the facility’s footprint from 10,000 square feet to 20,000 square feet. Furthermore, NEXE’s compostable coffee pods could make the Company an attractive acquisition target for companies looking to get their grubby hands on NEXE’s proprietary technology.

At the end of the day, NEXE needs to get its brand out there. While the Company’s first XOMA Superfoods order from PSC is a step in the right direction, the clock is ticking. NEXE needs to take advantage of its unique position as one of few compostable coffee pod manufacturers occupying the space. Whether that’s through press releases, social media, or investor relations, NEXE needs to promote itself before the market becomes oversaturated with plastic pod alternatives.