#Cannabis
News Alert; Vertically integrated cannabis consumer goods company 1933
Industries (CSE: $TGIF.C) (OTCQX: $TGIFF) Corporate Update; @1933Industries
Highlights:
·
1933
Industries continues to focus its operations in the licensed US cannabis
industry as a multi-state operator in Nevada, Colorado and California.
·
1933
Industries is a two-year old company built with sustainability and
profitability as its primary goals and continues to execute on its growth plan.
·
The
Company has instituted capital efficient practices to operate a lean and
sustainable business with scalable profitability as its main objective.
·
The
Company maintains a strong balance sheet with cash on hand to fund capital
projects, the ability to service its debenture payments and currently holds no
other debt.
·
Experienced
in the cannabis industry, the operationally focused management team raised
approximately $36M over the last two years and has added $60M in assets to the
Company.
·
Three
major capital projects were undertaken by management in order to build expanded
infrastructure capacity for cannabis flower cultivation, production of
concentrates, and hemp-derived CBD extraction in Nevada.
·
Cultivation
facility in Las Vegas was completed and the first harvest is now expected in
December, bringing a 5-fold increase in flower production and raw materials for
cannabis concentrates.
·
New
manufacturing facility in California is coming online in November as well as
expanded cultivation capacity for the Company’s AMA premium flower brand.
·
The
Company’s proprietary Canna Hemp™ wellness line continues to establish itself
as a premier CBD brand across the US and is now available in over 800 retail
outlets.
·
World-renowned
brands such as OG DNA Genetics, and The Original Jack Herer® selected the
Company’s subsidiary, Alternative Medicine Association, as their exclusive
partner in Nevada, as well as luxury brand Blonde™ Cannabis, leading
concentrate producer Denver Dab Co., premium cannabis brand Gotti’s Gold
and custom hardware manufacturer PLUGplay.
·
Leading
specialty retailer Zumiez is now carrying the Company’s CBD Canna Hemp X™
sports cream, which was launched in collaboration with top skateboarding
company Grizzly Griptape.
·
The
exclusive Birdhouse Skateboards™/Canna Hemp X™ co-branded sports cream is set
to launch in November and will be available at US Zumiez stores.
Fiscal Responsibility, Strong Balance Sheet
and Cash Position
The Company recently provided guidance on
its Q4 financial results (see news release dated September 12, 2019) and will
be announcing its Annual Financial Report by the regulatory deadline of
November 30th.
1933 Industries is a two-year old company
built with sustainability and profitability as its primary goals and continues
to execute on its growth plan. The Company sold its purpose-built
cultivation facility and negotiated a 10-year lease-back agreement to operate
one of Nevada’s largest indoor cultivation facilities for premium craft
cannabis (see news release dated May 15, 2019). Gross proceeds of $10.45M are
being utilized to fund infrastructure projects in Nevada and California, to
open new markets in Arizona and Colorado, and to continue the expansion of its
Canna Hemp™ consumer branded goods across the US. Management has built
significant sequential growth, quarter after quarter, year over year, building
a continued path towards profitability once all projects become fully
operational. Additionally, the Company has streamlined its business units to
significantly improve operational efficiencies across and reduce corporate
overhead.
Expanding Cultivation Capacity in Nevada
and California
The
Company recently reported that it expects the first harvest of high premium
flower from its new cultivation facility in Las Vegas in December, with
subsequent harvests every two-weeks thereafter (news release dated September 30,
2019). The completion of the 67,750 sq. ft. purpose-built, indoor
facility was a major milestone for the Company as it positions itself as the
largest wholesale supplier of premium craft flower to licensed dispensaries and
ensures the consistent supply of raw materials for the Company’s AMA product
line and licensing partners. The expected output of 700 lbs. of cannabis flower
is a 5-fold increase in production and the Company expects that all flower
rooms will be filled and harvesting on a continuing basis by January, 2020.
The cultivation and manufacturing buildout
in California is on schedule to be completed by the end of October and will be
in production by November. The California operation is managed by the Company,
but owned by a third party (news release dated August 15, 2019). Both the
Nevada and California facilities bring almost 80,000 sq. ft. of total
cultivation space to the Company while positioning the Company to maximize
cultivation and extraction capabilities in both states.
New
Extraction Facilities in Progress
The
Company reports that the renovation to increase the footprint of its current
extraction facility is on track to receive construction permits from Clark
County this week. The construction will take three months to complete, which
will double the Company’s extraction and production capabilities (news release
dated July 12, 2019).
The
Company’s hemp-derived cannabidiol (CBD) extraction facility (Hemp Lab) under
development is being designed with the capacity to isolate cannabinoids
such as CBD, CBN and CBG, at commercial scale volumes in order to utilize all
isolates in the manufacturing of the Company’s own proprietary branded
products, with the aim of increasing product margins and bringing online a new,
recurring revenue stream. The Company will be providing a full update on its
Hemp Lab once it finalizes the timing of equipment delivery, county approvals
and engineering plans.
Positioning Canna Hemp as the Premier CBD
product line in the US
As
a brand-focused company, building a strong portfolio of high margin,
industry-leading brands that have wide appeal to consumers is a key priority
for the Company. With wholesale partnerships, nationwide reach of its products,
and a new partnership with Zumiez retailer in the US, the Company has added an
e-Commerce channel with a revamped website portal and upcoming marketing
campaigns targeting mainstream media.
The
Company’s sports cream, Canna Hemp X™, a collaboration with Grizzly Griptape,
targets a growing consumer following from the skateboarding, BMX, snowboarding,
motocross and MMA fields of sport. Working through brand ambassadors in all the
above sports, the Company is building a brand that resonates with athletes of
all levels. The Company has executed licensing agreements with best of breed
names including Grizzly Griptape and Birdhouse Skateboards™, with the latter
soon to launch a co-branded Birdhouse/Canna Hemp X™ CBD Balm in November.
Marketing campaigns will include skateboarding legend Mr. Tony Hawk, Mr. Clive
Dixon, Mr. David Loy as well as other Birdhouse team riders to promote the collaboration.
The Company continues to build on its ambassador and influencer programs, with
the aim to build teams across the main focus sports noted above.
Management
Commentary
Mr.
Chris Rebentisch, CEO of the Company remarked, “We are pleased to report that
we have never been in a stronger position as a company. We are fully
capitalized to execute on our strategy, without having to raise capital and
with no debt in our books. With multiple projects coming online over the next
months that will increase revenues, we will continue to build our strongest
brand portfolio to date while we work towards profitability. We confirm that
the Company’s management is unaware of any material change in the
Company’s operations that would account for the recent increase in market
activity. The current share price is not representative of the performance of
our operations.”
Mr.
Brayden Sutton, Chairman of the Board added, “We have a solid balance sheet
that demonstrates the strength of the management team and its expertise as
operators in the cannabis space with a long history of execution in the
consumer packaged goods sector. We continue to build one of the most impressive
‘House of Brands’ in the market with increasing revenues and distribution. We
are in the enviable position to weather market pressures until the sector
recovers, and we believe that in the changing landscape of the cannabis
industry, companies such as ours with strong fundamentals will become the next
phase of the cannabis industry, one that will be distinguished by quality
products, safety of ingredients and brand affinity.”
About
1933 Industries Inc.
1933
Industries Inc. is a vertically integrated, brand-focused cannabis company with
operations in the United States and Canada. Operating through two
subsidiary companies, the Company owns leading cannabis brands as well as
licensed cannabis cultivation, extraction, processing and manufacturing assets.
Our
award-winning proprietary portfolio of brands include: AMA flower and AMA
concentrates, CBD-infused Canna Hemp™, Canna Hemp X™, and Canna
Fused™. Partners under licensing agreements include Birdhouse
Skateboards™, Blonde™ Cannabis, Denver Dab Co., Gotti’s Gold, Grizzly
Griptape, OG DNA Genetics, PLUGplay, and The Original Jack Herer®.
The
Company owns 91% of Alternative Medicine Association, LLC (AMA), and 100% of
Infused MFG LLC.
About Canna Hemp™
Canna Hemp™ CBD Relief Cream was named
“Best Topical” by Leafy’s Best in State: The Top State Specific Products and
Experiences of 2018.
About Canna HempX™
Canna
Hemp X™ was named “Best Topicals for Pain” by Herb’s Guide to the Best Cannabis
Products on the Planet. Canna Hemp X™ is a CBD sports recovery cream for
athletes, bridging the gap between recovery and top performance.
For further information please contact:
Alexia
Helgason, IR and Corporate Communications Director
604-674-4756 (ext. 1)
alexia@1933industries.com
Chris Rebentisch, CEO & Director
604-674-4756 (ext. 1)
Neither
the Canadian Securities Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the Canadian Securities Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Notice regarding
Forward Looking Statements: This news release contains forward-looking statements.
The use of any of the words "anticipate", "continue",
"estimate", "expect", "may", "will",
"project", "should", "believe" and similar
expressions are intended to identify forward-looking statements. Although the
Company believes that the expectations and assumptions on which the
forward-looking statements are based are reasonable, undue reliance should not
be placed on the forward-looking statements because the Company can give no
assurance that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very nature they
involve inherent risks and uncertainties. These statements speak only as of the
date of this news release. Actual results could differ materially from those
currently anticipated due to a number of factors and risks including various risk
factors discussed in the Company's disclosure documents, which can be found
under the Company's profile on www.sedar.com. 1933
Industries undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new information, future
events or otherwise, except as required by law.
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