THC Global updates the market, Sunniva's CEO steps down, Supreme Cannabis Launches a new CBD oil, and more!
It was a big week for CuraLeaf Holdings (CSE:CURA), after the company published third quarter results showing a 27% increase in total revenue. Total revenue for the third quarter of 2019 increased 189% year-over-year to $61.8 million, compared to $21.4 million in the third quarter of 2018.
Retail and wholesale revenue increased more than three-fold to $50.7 million during the quarter, compared to $16.6 million in the third quarter of 2018. The increase in retail and wholesale revenue was primarily due to organic growth in Florida, New York and acquisitions in Arizona and Maryland. Additionally, wholesale revenue increased in Massachusetts as a result of the number of newly opened adult-use dispensaries.
Gross profit before impact of biological assets for the third quarter of 2019 was $34.7 million, compared to $13.9 million for the third quarter of 2018. The increase was due to continued improvement in the operating capacity of the company's cultivation and processing facilities.
Our increasing scale along with the incredible efforts of our team around the country who ensure our patients and customers have a superior experience, helped drive the strong financial results we posted this quarter. We look forward to the closing and integration of the Select and Grassroots acquisitions which are expected to bring significant operational capacity to Curaleaf in key markets. Curaleaf Holdings CEO, Joseph Lusardi
The company also announced that it has launched its custom-designed Veterans Cannabis Project pre-roll product in Florida.
A portion of all proceeds will benefit the Veterans Cannabis Project (VCP), an organization that advocates for legal and supported access of medical cannabis for veterans through the Department of Veterans Affairs.
In Florida the boxes will be available for $26, and each box contains five 0.4 oz pre-rolls for a total of 2 grams per box.
Curaleaf also celebrated the opening of its 27th dispensary in Florida this week, at 3631 NW Federal Highway in Jensen Beach. The company currently has the largest cannabis dispensary footprint in the US, with 50 dispensaries across the country and continues to execute on its strategy of rapid expansion in Florida.
The new 4,500 square foot location is accessible to patients from the Jensen Beach area, including the communities of Jupiter, Port St. Lucie, Stuart, Port Salerno and Palm City, and will offer a full range of premium quality medical cannabis products and private consultations by meticulously trained staff.
Acreage Holdings, Inc (CSE:ACRG) announced that on November 15, certain of its subsidiaries and cannabis non-profit corporation, Compassionate Care Foundation, Inc entered into a Reorganization Agreement, pursuant to which Acreage will acquire 100% of the equity interests in CCF, and subsequently consolidate their financials. Closing of the transaction is subject to state approval.
With a population of approximately nine million, New Jersey is estimated to generate $317 million in legal medical cannabis sales by 2022, according to Arcview Market Research.
"I'm thrilled to finally welcome CCF into the Acreage family," said Chairman and Chief Executive Officer of Acreage," said Acreage Chairman and CEO Kevin Murphy.
This reorganization will result in increased access to affordable medical cannabis for New Jersey's existing patients in short order. Moreover, we have long believed that upon adult-use legalization, the New England and Mid-Atlantic regions will be the preeminent cannabis market in the U.S. and Acreage is best positioned of any U.S. cannabis company to benefit. Chairman and CEO of Acreage, Kevin Murphy
The company now operates the largest bio-floral extraction facility in the Southern Hemisphere. Harvesting has also commenced at Bundy Facility to bring cannabis plant material to Southport Facility.
Cannabis cultivation program using proprietary strains and tissue culturing techniques to ensure genetic consistency and enable rapid multiplication for fast build out of plant material supply Eden Farms Cultivation Project to support cultivation of additional 1,000,000 plants per year at low cost with minimal capex and lead time to commence operations.
During the quarter Harvest opened six new retail locations, acquired four retail locations, won a cultivation license in Utah and made progress toward completing several significant strategic acquisitions. Total revenue was $33.2 million, an increase of 197% from $11.2 million in the third quarter of 2018 and up 25%, compared to $26.6 million in the second quarter of 2019.
On a pro forma basis, Harvest along with completed and pending disclosed acquisitions, generated $95 million of revenue in the third quarter, or over $380 million annualized. Third quarter pro forma revenue increased 22% over second quarter pro forma revenue of $78 million.
During the third quarter, Harvest continued to execute on its strategy by investing in assets and infrastructure needed to return to profitable growth. As a company, we have the assets and team required to achieve operational excellence and succeed in the cannabis industry. Harvest Health & Recreation CEO, Steve White
Cann Group Limited (ASX:CAN) announced that it will undertake the construction of its Mildura medicinal cannabis facility in stages.
Previously, the company had intended to complete the Mildura facility as a single stage development—with a total capacity of 70,000 kgs—which would have come in at an estimated project cost of $184 million.
With commissioning scheduled for the latter half of 2020, work had already commenced at the Mildura site, and to date the company has expended $47 million on its acquisition and construction. As a result of its new staged approach, the company is now reviewing a "revised construction plan" for the project, which will also involve consultations with Cann's team of design and engineering consultants, which includes Aurora Larssen Projects.
iAnthus Capital Holdings, Inc (CSE:IAN) which owns, operates, and partners with best-in-class regulated cannabis operations across the United States, reported financial results for the fiscal third quarter ended September 30, 2019.
The Eastern Region revenues increased to $13.2 million, up 30% from the prior quarter as a result of the company's expanded retail presence in Florida, increased demand for MPX branded products in Maryland and continued expansion into the CBD market; partially offset by lower wholesale revenues in Massachusetts due to the ongoing vaping products ban.
Moreover, the Western Region revenues increased to $9.1 million, up 1% from the prior quarter due to strong sales in Arizona, countered by lower wholesale in Nevada as the company shifted away from bulk wholesale in anticipation of selling more MPX branded products going forward.
I am confident that we are well on our way to positive EBITDA in 2020 and in our ability to generate operating cash flow and grow enterprise value. iAnthus CEO, Hadley Ford
Sunniva Inc (CSE:SNN), announced to the market that the company's CEO, Kevin Wilkerson, has resigned from his position of President of the company and from the position of President and Chief Executive Officer of Sun CA Holdings, Inc—the company's main US subsidiary—effective December 2, 2019.
The company has not announced any replacement for Mr. Wilkerson at this time.
In addition to this leadership change, Mr. Michael Barker, a director on the company's board of directors, has resigned from the Board effective November 15, 2019.
With the launch of Pūr Dew CBD oil, Supreme Cannabis diversifies its product offerings, which currently include dry flower from 7ACRES and high-THC cannabis oil from KKE. Pūr Dew was created in British Columbia, using pure CBD cannabis oil and USDA certified organic MCT coconut oil. Blissco was able to retain the delicate terpenes, giving Pūr Dew the aromatic smell of clove, with refreshing hints of citrus and pine.
Blissco is committed to sourcing packaging that is the least harmful to the environment. Continuing this commitment, Pūr Dew is available in recyclable glass bottles and the cardboard packaging is made from 100% post-consumer waste paper.
We are excited to expand our product offering to include CBD, arguably one of the fastest growing product segments on the market. As Blissco's first CBD oil, Pūr Dew offers consumers full-spectrum CBD and USDA certified organic MCT coconut oil. Supreme Cannabis CEO, Navdeep Dhaliwal
The 90-day plan will focus on five key objectives: 1) focusing on core markets, while divesting non-core assets; 2) reducing corporate SG&A; 3) driving asset-level EBITDA; 4) limiting cash outlays for the next 12 months; and 5) reinvesting in the company's employees and culture.
MedMen believes the company can execute this plan while still growing its retail presence and maintaining a best-in-class retail experience. According to the co-founder and CEO of MedMen, Adam Bierman, the company has a clear plan to, "increase our market share, while at the same time enhancing our margins and reducing our corporate overhead."
"We must unlock our operating leverage and bring the company to positive EBITDA. Given market conditions, capital allocation is more critical than ever. As such, we announced a layoff of over 190 MedMen employees."
"We have a clear plan to increase our market share, while at the same time enhancing our margins and reducing our corporate overhead," he said.
Watch this space for future updates.
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