Wild swings continue to intrigue investors following Green Innovations Ltd. (OTCBB: GNIN) as the company has once again shaken off a share price slide that saw them dip down to 0.9101 earlier this week and climb as high as 2.05 today with trading volume already surpassing the 8.6 million mark by mid-day. For those who have not been tracking GNIN this is the same company that was trading at a low of 0.1700 last November, bounced to a 52-week high of 3.35 on February 19, 2013, crashed to 0.3750 two days later and then built their way back up to 1.60 on March 1 yet fell to that 0.9101 level the same day. To say it’s been a crazy ride would be an understatement.
GNIN’s surge to 2.05 came after the company announced that their wholly-owned subsidiary, Green Hygienics, Inc. “has begun fulfilling several recently announced product purchase orders to some of its newest southern California retailers and distributors.” Later in that press release the company noted that their Green Hygienics products “will now be available in over 1,300 locations in California, including more than 1,000 dollar stores.”
Green Hygienics, inc. is the exclusive licensed North American distributor of American Hygienics Corporation’s 100% tree-free bamboo-based product line, including personal care and paper-based goods and it is these products that seem to have GNIN building momentum.
According to a press release issued by GNIN on Monday there were 15 products that were in the process of obtaining final approval to be distributed by Federated Group, “a leading grocery private label brand developer, owner, and marketer in the United States.” For investors this approval could represent significant growth for GNIN as Federated Group distributes products to several thousand retailers throughout the country.
While the news has many investors excited and pushing trading volume to impressive heights for GNIN it should be understood that they have not received final approval as yet. They did mention in their announcement that the approval process was expected to be short so something definitive should be coming soon.
It should be mentioned that the sales and purchases orders generated through Green Hygienics, Inc. are tied to GNIN’s arrangement with AHC, providing them an exclusive license agreement for the distribution of certain AHC bamboo products in North America for a period of five years. Outside of this information GNIN hasn’t given much in the way of details regarding how that exclusive license agreement is structured financially.
What they have said is that they surpassed $500,000 in sales and purchase orders in just their first three months of operations; a dollar figure has already surpassed certain milestones outlined in GNIN’s licensing agreement with American Hygienics Corporation. The question is how much of money from these sales and purchase orders will go to GNIN.
The answer to that may not fully be known until GNIN files their quarterly report and at that time investors may have a better understanding of what lies ahead for the company. Considering that in their last quarterly report GNIN acknowledged they hadn’t generated any revenue to date this next financial report should be telling.
As it stands investors are almost forced to take a leap of faith at the moment concerning GNIN and with the company’s share price so volatile that faith may be a huge gamble.