The acquisition pushes THC to the forefront of the Australian medicinal cannabis industry.
It prompted an 18% increase in shares to 72 cents in early trading.
The facility is one of the largest pharmaceutical botanicals extraction and refinement plants in the Southern Hemisphere.
Large-scale facility means THC can become a global player
The acquisition will enable THC to become a globally significant manufacturer of medicinal cannabis products for Australian and export markets.
The facility provides large-scale capacity required to supply the Australian medicinal cannabis industry.
THC’s chairman Steven Xu said: “This is a game-changing investment undertaken by THC providing it with large-scale, state-of-the-art biomanufacturing capabilities required to lead Australia’s medicinal cannabis industry.
“The addition of this acquisition is a major component of our roll-out strategy that will generate substantial growth for the company.”
THC acquired the facility from international pharmaceutical company LEO Pharma, who are changing their global production plans.
Total consideration paid for the land and facility is $2.55 million.
The facility is a fully functioning biomanufacturing plant with extraction technology to produce a broad range of high quality, pure cannabinoids as Active Pharmaceutical Ingredients (API).
Importantly, THC has also secured the engagement of key personnel with expertise operating the Queensland biomanufacturing operation.
THC moving in line with legislation changes
In January 2018, Federal Government Health Minister Greg Hunt stated that the Turnbull Government would permit the export of Australian manufactured medicinal cannabis products.
When the changes were announced, Hunt said: “This decision will help both the domestic supply and Australian producers by strengthening the opportunities for domestic manufacturers.”
March quarter cash receipts surpass $1 million
Notably, the company's receipts from customers for the March quarter were $1.079 million.
This represents a 31.4% increase on the December quarter, which recorded receipts from customers of $821,000.
THC’s growth can be further exemplified by the fact that its receipts from customers for the entire 2017 calendar year totalled $1.6 million.