Investor Ideas #Potcasts, #Cannabis News and #Stocks on the Move; Episode 414 (OTC: $CSUI) (NYSE: $ACB) (TSX: $ACB.TO), (NASDAQ: $SNDL) (TSX: $VLNS.TO) (CSE: $AGRA.C)
Delta, Kelowna, BC, May 15, 2020 (Investorideas.com Newswire) www.Investorideas.com, a global news source covering leading sectors including marijuana and hemp stocks and its potcast site, www.potcasts.ca release today’s podcast edition of cannabis news and stocks to watch plus insight from thought leaders and experts.
Listen to the podcast:
Today’s podcast overview/transcript:
Good afternoon and welcome to another episode of Investorideas.com "Potcast" featuring cannabis news, stocks to watch as well as insights from thought leaders and experts.
Today’s podcast is sponsored by Cannabis Suisse Corp. (OTC: CSUI), a research & development company licensed under Swiss Cannabis and tobacco regulations to cultivate and sell cannabis. The Company's facilities for producing cannabis are based in Zurich.
The Company grows high quality, organic cannabis with sustainable, all-natural principles. Cannabis Suisse products are laboratory tested to ensure the end users have access to a standardized, safe and consistent product.
In today’s podcast we will be looking at a few public company announcements.
Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), the Canadian company defining the future of cannabis worldwide, announced its financial and operational results for the third quarter of fiscal 2020 ended March 31, 2020 yesterday which has lead the stock to trade up nearly 50% over the last two days.
Michael Singer, Executive Chairman and Interim CEO of Aurora stated, "I am incredibly proud of the Aurora team for working through these challenging times in order to maintain uninterrupted operations at all of our production facilities and ensure we continue to meet the needs of our patients and consumers. I am also pleased that our third quarter 2020 financial results were in-line with our expectations, and that we remain firmly on track with the cost-savings and capex goals we detailed during our business transformation plan in February 2020."
Since announcing the Business Transformation Plan on February 6, 2020, Aurora has taken a number of concrete steps which place Aurora firmly on track to meet or exceed previously announced targets. These steps are designed to strengthen Aurora's balance sheet and reduce go-forward costs, as the Company works to achieve profitability and positive cash flow.
Some of the financial highlights included a Net revenue of $78.4 million, excluding provisions of $2.9 million, an increase of 18% over prior quarter; consumer cannabis net revenue of $41.5 million, excluding provisions, a 24% increase over prior quarter; cash cost to produce per gram of dried cannabis sold at $0.85, down from $0.88 in Q2 2020 and an improved cash position of $230.2 million; $154.6 million in Q3 cash use represents a 43% decrease over prior quarter.
Sundial Growers Inc. (NASDAQ: SNDL) also had a strong uptrend after reporting its financial and operational results for first quarter 2020 ended March 31, 2020 .
Some of the First quarter 2020 financial and operational highlights included, strategic shift away from "Heal, Help and Play" strategy to concentrate on Canadian recreational cannabis with a focus on inhalable products; annualized net cost reductions of approximately $28 million in 2020; Net revenue of $23 million , an increase of 7% over the prior quarter; Net cannabis revenue of $16.5 million , excluding provisions of $2.5 million , an 18% increase over the prior quarter; branded net cannabis sales increased to 54% of total net cannabis sales in the first quarter of 2020 vs. 33% in the fourth quarter of 2019 and overcame significant processing challenges and improved supply chain capabilities during the quarter; recently, 'On Time In Full' (OTIF) metrics have surpassed 90%.
"We have made significant progress in improving our cost structure and liquidity in the past few months," said Zach George , Chief Executive Officer of Sundial. "The agility of our "craft-at-scale" cultivation strategy also became evident as we quickly aligned our operations with market conditions, by temporarily curtailing cultivation activities to adapt to current demand levels. We are pleased to have made progress towards the sale of Bridge Farm and the subsequent restructuring of our secured debt. These steps are critical in order to improve Sundial's financial health."
"The COVID-19 pandemic has brought many challenges over the past few months and our team has shown outstanding commitment and courage, working tirelessly despite these new demands," added George. "We truly appreciate their efforts and their health and safety continues to be a priority for Sundial. As we move forward, we remain focused on achieving sustainable profitability and will continue to pursue opportunities to drive improved efficiency."
Valens GroWorks Corp. (TSX: VLNS) (OTCQX: VLNCF), a global leader in the end-to-end development and manufacturing of innovative, cannabinoid-based products, announced that it has signed a distribution agreement with Cannvalate Pty Ltd., Australia's largest medicinal cannabis distributor and clinical research organization, with a current estimated market share of almost 50% of cannabis prescriptions in the country.
The five-year, non-exclusive agreement is based on an asset-light revenue generating pay for performance model, providing Cannvalate achieves milestones based on certain financial targets and facility construction and licensing timelines outlined in the agreement. Under the terms of the agreement, The Valens Company is also in the process of finalizing a long-term lease on a property in Australia with an independent third party. This is expected to be built out by the landlord as a small-sized extraction and manufacturing facility designed to be scalable, forming the hub of The Valens Company's operations in the country. Construction on the facility is expected to commence on signing the lease and is expected to be fully operational halfway through 2021, subject to applicable licensing and regulatory approvals.
In the near term, The Valens Company is expected to monetize the agreement with Cannvalate through shipments of a broad range of products from its facility in Canada to Australia. As such, the terms of the agreement require minimal upfront capital investment by The Valens Company. The Company is targeting initial revenue from this agreement in Q3 2020 subject to receiving the necessary import and export permits.
"This partnership provides Valens with strategic access to Australia's strong and fast-growing cannabis market," said Tyler Robson, CEO of The Valens Company. "With a proven track record, strong knowledge of the local market, and a leading distribution platform in Australia, Cannvalate is an excellent partner for us to build our presence in this pivotal hub with significant long term growth opportunity."
"The agreement allows us to maximize incremental revenue potential, while spending minimal capital upfront and scaling our operations as the opportunity expands," added Jeff Fallows, President of The Valens Company. "Australia's medical patient base, similar to the early stages of medical patient growth in Canada, offers an attractive return for our shareholders with potential upside as this also positions us strongly in a market that is expected to ease regulations around CBD products in early 2021."
"The Australian market is the fastest growing, pure-play medicinal cannabis market in the world and is unique in that oil-based derivatives represent over 95% of the total products sold. This opportunity provides the platform for The Valens Company to become the primary extractor and contract manufacturer for licensed producers throughout Australia and Asia-Pacific," said Dr. Sud Agarwal, CEO of Cannvalate.
AgraFlora Organics International Inc. (CSE: AGRA) (OTC: AGFAF) announced that its subsidiary The Edibles and Infusions Corporation (“EIC”) has completed construction on its 51,000-Square-foot fully-automated edibles manufacturing facility in Winnipeg, Manitoba (the “Edibles Facility”). The company is now preparing to apply for a Standard Processing License (the “Processing License”) from Health Canada. It intends to submit the application for the Processing License before the end of May 2020.
The completed 51,000 square-foot Edibles Facility was built to meet or exceed regulatory standards with respect to security, cleanliness and product safety. The equipment to be used for manufacturing is of the highest quality and will allow EIC to pursue EU-GMP certifications in the future. The equipment utilizes specialized dosing technology that provides specific dosing to meet regulatory requirements and customer specifications, while also reducing the risk of contamination or degradation of the cannabis inputs. When fully operational, EIC expects to produce over 250,000 pieces of precisely dosed edibles per eight-hour shift. The facility can be run 24/7 if required and is anticipated to require only 30 staff at full operation due to the high level of planned automation. The Edibles Facility is designed to be flexible with respect to future product lines including chocolates and drinks, and scalable up to 1,000,000 pieces of precisely dosed edibles per eight-hour shift with additional manufacturing lines.
James Fletcher, one of the founders and the operational manager of EIC stated, “Our Edibles facility is designed to be, to our knowledge, the most technologically advanced and efficient cannabis facilities in Canada. Our team has almost 100 years of knowledge and experience in private label confectionery manufacturing. Rather than trying to scale up practices developed in unlicensed establishments, we have built a Facility which can produce cannabis edibles using world-class food manufacturing processes. As a result, we will be able to provide our clients with the highest level of service and support as we work together to build lasting and valuable brands nationwide.”
The EIC management team has almost a century of manufacturing experience in the confectionery industry, combined with guidance from multiple legal Canadian cannabis companies. Outside of cannabis, the team operates under multiple regulatory regimes, including US FDA, and its workflows are SQF Level 2 Certified to ensure food safety and business efficiency.
EIC currently holds a Research and Development license (“R&D License”) from Health Canada that allows it to produce cannabis edibles for the purpose of recipe development, including palatability studies. The company intends to use the R&D License to perfect its recipes with clients to ensure that customers are satisfied with the flavor, shape, size and mouthfeel of each gummy produced. Utilizing the R&D License this way will allow EIC to develop commercial relationships and be ready to scale revenue quickly upon the issuance of the Processing License.
"Edibles are the most attractive cannabis 2.0 product category to AgraFlora, and within that category gummies have emerged in Canada and the United States as the clear winner. EIC positions AgraFlora to be a leader in cannabis gummies,” stated Brandon Boddy, Chairman and Chief Executive Officer of AgraFlora. “To date, the gummy category has not been fully supplied as companies have struggled to scale up manufacturing. We chose our management team based on their experience and our expectation of being able to scale quickly post-license to meet the needs of Canadian consumers and brands. Given the recent increase in cost of capital, we feel that our timing to come to market in 2020 is perfect as brands will be able to enter the edibles space using EIC as a partner without the capital expense or time involved with scaling up in-house manufacturing capacity. We look forward to EIC powering what we expect will be some of Canada’s top edible brands in 2020 and beyond.”
Finally to end today’s podcast I again bring up the momentum building surrounding the psychedelic industry and how this industry is now entering more mainstream media as well.
Recently Netflix released a special featuring actors, artists, comedians and musicians all discussing their use of psychedelics and encouraging proper usage of these drugs called “Have a Good Trip: Adventures in Psychedelics”.
Not only that but this season of the show “Billions”, a show directly about the Wall Street world and market trends, started off with an Ayahuasca trip and is focussing on the attempt to bring medical ayahuasca to market.
As more businesses invest in the space, more medical professionals and research teams confirms the benefits of these compounds, and as media and art move to a level of open endorsement not seen since the 60’s it seems an inevitability that these psychedelics will be legalized or decriminalized within the next 2 years. This in tandem with the mass of psychological impacts caused from COVID isolation make this even more of a guarantee.
Once again, today’s podcast was sponsored by Cannabis Suisse Corp. (OTC: CSUI), a research & development company licensed under Swiss Cannabis and tobacco regulations to cultivate and sell cannabis. The Company's facilities for producing cannabis are based in Zurich.
The Company grows high quality, organic cannabis with sustainable, all-natural principles. Cannabis Suisse products are laboratory tested to ensure the end users have access to a standardized, safe and consistent product.
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