- Product authentication company YPB Group (YPB) has entered a take-or-pay contract with Zhongneng CIC International Import and Export Trade
- The three-year contract has a minimum order quantity of RMB1 million (roughly A$200,000) a year, making it worth approximately $600,000
- Zhongneng CIC will deploy YPB’s T2 Tracer-Scanner technology into packaging for its customers in the tobacco, liquor, and pharmaceutical industries
- The company considers this contract to be a springboard for further revenue and customer base growth in China
- YPB Group shares are in the grey in early trade, priced at 0.3 cents
Product authentication company YPB Group (YPB) has entered a take-or-pay contract with Zhongneng CIC International Import and Export Trade.
The company’s new contract runs for three years and has a minimum order quantity of RMB$1 million (roughly A$200,000) a year. This means the take-or-pay agreement is worth roughly $600,000 at least, making it YPB’s highest set value contract in China to date.
Under the contract, Zhongneng CIC will deploy YPB’s T2 Tracer-Scanner technology into anti-tamper and anti-counterfeit packaging. This will initially be implemented for Zhongneng’s customers in the tobacco, liquor, and pharmaceutical industries.
YPB Group considers this contract to be a springboard for the company’s ongoing growth in the Chinese market.
The company’s CEO, John Houston, called the contract with Zhongneng CIC a great example of the revenue and customer base that YPB is now building in China.
“The roughly $600,000 in revenue we will book in the first few years is based on YPB’s T2 Trace-Scanner technology being deployed in three sectors only, and Zhongneng CIC has already identified more sectors and other areas of their business where the technology can be used,” he said.
“We anticipate this contract will grow in value and will lead to other Chinese customers contracting with YPB,” he added.
John went on to say that YPB has also made considerable progress with the pending commercial launch of MotifMicro1. The company expects to provide an update on that particular product shortly.
YPB Group shares are in the grey in early trade, priced at 0.3 cents at 10:21 am AEDT.