The Bod Australia Ltd (ASX: BDA) share price is on the run during early morning trade. This comes after the company announced its first purchased order for the United States market. At the time of writing, the cannabis healthcare company's shares are swapping hands for 50 cents, up 5.26%.
What did Bod announce?
Investors are scrambling to buy Bod shares following its latest positive update in a bid to expand its revenue base.
According to this morning's release, Bod advised it has received its initial binding purchase order from Health & Happiness Group. The first of multiple orders for the CBD products are set to be launched into the United States market. This also includes three full-spectrum CBD oil extracts under its premium brand name, CBII.
The products will be available to consumers directly through ecommercial channels sometime in the current first-half of the calendar year. Consequently, Health & Happiness will commence marketing and brand campaigns to create awareness and drive sales in the United States.
The maiden order is valued at $312,000, in which Bod will received a royalty on net product sales. In addition, a cost-plus margin for the supply of the finished goods is also set to create addition revenue streams for Bod.
Delivery of the first lot of CBD products is expected to arrive in the coming months.
The addressable market for CBD consumer products in the United States is estimated to reach around US$6.9 billion by 2025. This represents four times the size that of the United Kingdom's CBD market.
Comments from the CEO
Bod CEO Jo Patterson commented:
The first US purchase order is an exciting step for Bod on two fronts, firstly as it's growing our global footprint, and secondly the US offers a significant opportunity for consumer healthcare CBD products.
Bod will continue to work with H&H to progress additional opportunities in North America. We look forward to updating shareholders on more purchase orders soon.
About the share price
Over the last 12 months, the Bod share price has accelerated to more than 100%, but is relatively flat year-to-date. The company's shares reached a 52-week high of 74 cents last December, before moving in circles.
Based on the current share price, Bod has a market capitalisation of roughly $50.2 million, with 105.8 million shares outstanding.
