The Calmer Co Locks in A$25M Exclusive Global Kava Ingredient Deal

Calmer Co. locks in up to A$25 million exclusive global kava ingredient deal

The Calmer Co. International Limited (ASX: CCO) has executed an Exclusive Distribution Agreement with a multinational ingredients company, granting it “exclusive global distribution rights” for the Company’s range of kava extract ingredients.

The headline figure is significant. To retain exclusivity, the Distributor must meet minimum purchase commitments of approximately A$25 million over the initial three-year term.

That total includes approximately A$5.5 million in year one, increasing across years two and three as minimum volumes grow. The Company has framed these as minimums the Distributor must satisfy to retain exclusivity, positioning the deal as a potentially significant new contracted revenue stream.

Exclusive rights span Australia, New Zealand, the United States, Canada and ASEAN markets. The initial term runs three years, with two further three-year renewal options subject to the Distributor meeting minimum purchase and payment conditions.

What the agreement delivers

The Distributor is part of a multinational ingredients group specialising in plant-derived and natural healthcare ingredients, supplying botanical, nutritional and plant-based raw materials into the dietary supplements, sports nutrition and complementary medicines markets, with distribution across more than 60 countries.

Under ASX Compliance Update 02/25, the Company does not consider the Distributor’s identity to be price-sensitive information, and its name has not been disclosed.

The agreement covers the Company’s kava extract ingredient range, incorporating a number of standard commercial protections. Key terms include:

• Products covered: water-extracted and CO2-extracted Noble Kava products

• Co-branding on an “ingredient inside” basis, allowing the Distributor’s ingredient brand to feature on CCO finished products

• Periodic price review mechanism, reviewable by notice every twelve months

• Retention of title and security interest provisions over unpaid stock

• Agreed product specifications, quality warranties and mutual rights of inspection

Renewals remain subject to the Distributor meeting minimum purchase and payment conditions.

For investors, the combination of minimum purchase commitments and retention-of-title provisions offers enhanced revenue visibility and payment security relative to uncontracted wholesale sales.

CEO Zane Yoshida on the strategic milestone

Chief Executive Officer Zane Yoshida described the agreement as an important strategic step in monetising the Company’s kava extract ingredients through a globally established distribution partner.

Zane Yoshida, Chief Executive Officer

“This agreement represents a major validation of our botanical ingredients strategy. Securing a multi-year distribution commitment from a multinational ingredients company gives us confidence in the global demand for our kava extract range and provides a substantial, contracted revenue stream over the coming years.”

Yoshida framed the deal as complementary to the Company’s expanding Pacific supply chain and manufacturing capability, reflecting what he called a “disciplined approach to building an integrated Pacific kava business capable of delivering long-term value for shareholders.”

Existing wholesale ingredients customers are preserved under agreed carve-out arrangements, alongside the new exclusive channel.

What is kava extract, and why the ingredients business matters

Kava is a natural product from the Pacific used to promote relaxation and sleep support. The Calmer Co. positions kava-based products as an alternative to alcohol.

There is a meaningful distinction between selling finished consumer products directly to shoppers and selling bulk botanical ingredients to other manufacturers. In the latter model, the Company supplies raw extract material to businesses that produce dietary supplements, sports nutrition and complementary medicines.

Wholesale ingredient sales can be attractive because they are typically higher-margin, contracted, and diversify revenue away from direct-to-consumer channels. For investors, this deal monetises the Company’s Pacific kava supply chain at the ingredients layer, adding a committed sales stream that helps de-risk the broader model.

Connecting Pacific supply with global distribution

This downstream distribution deal complements the Company’s previously announced upstream Strategic Supply Agreement with a leading Pacific-based supplier of premium noble kava. It is important to recognise these are two separate agreements.

The A$8.65 million kava supply agreement reserves ten tonnes of premium noble kava per month from Papua New Guinea and Vanuatu, carrying no minimum purchase obligation and providing the upstream raw material foundation that the new distribution deal is now designed to commercialise at scale.

The distribution agreement covers approximately A$25 million over three years, with approximately A$5.5 million in year one. The earlier supply agreement secured reserved minimum monthly supply capacity of premium noble kava from Papua New Guinea and Vanuatu, with an indicative annual supply value of approximately A$8.65 million.

CO2 extraction capacity to support anticipated volumes under the agreement is expected to be provided through the Company’s existing specialist extraction partners in Australia and India, together with advanced supercritical CO2 extraction capability being added in Fiji under the manufacturing partnership with Kaiming Agro Processing.

The Fiji manufacturing partnership with Kaiming Agro Processing subsidiary KAPPL is designed to add dedicated supercritical CO2 extraction capacity at a new Navua facility due for commissioning in December 2026, complementing the extraction partners in Australia and India already earmarked to support initial volumes under the distribution agreement.

Kava extract ingredients are sourced from Fiji, Papua New Guinea and Vanuatu. Together, the two agreements connect the upstream and downstream ends of the ingredients business, reflecting continued execution of a strategy to build a vertically integrated Pacific kava operation.

That value chain spans four stages:

1. Diversified grower relationships across Fiji, PNG and Vanuatu

2. Scientific quality assurance via the Company’s GC-MS laboratory capability

3. Advanced manufacturing through partners including KAPPL

4. Global commercialisation of both branded consumer products and, now, exclusively distributed botanical ingredients

The investment case: contracted revenue meets integrated strategy

The agreement adds a committed, multi-year sales channel that diversifies revenue beyond branded consumer products into higher-margin, wholesale botanical ingredient sales. It directly supports Wholesale (Bulk Ingredients), one of the Company’s four key strategic pillars.

The structure allows The Calmer Co. to secure global distribution through partnerships while concentrating its own capital and management focus on product innovation, supply chain integration and brand-building.

Near-term, the escalating minimums, from approximately A$5.5 million in year one and rising in years two and three, represent the revenue ramp the Distributor must meet to retain exclusivity. Longer-term, the two further three-year renewal options provide potential upside, though this remains conditional on the Distributor satisfying purchase and payment conditions.

For shareholders, the deal reinforces the Company’s evolving, vertically integrated operating model across the Pacific kava value chain as the core long-term value driver.

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