Palm Beach, FL – May 18, 2021 – The medical and recreational marijuana markets have shown significant growth over the past few years and is projected to continue for the next several years. One of the major factors fueling the market growth is the expanding demand for legal marijuana owing to the growing number of legal cannabis countries. Owing to the recent legalizations in different countries, the use of medical marijuana for various aliments is gaining momentum worldwide. Patients suffering from chronic illnesses, such as Parkinson’s, cancer, Alzheimer’s, and many neurological disorders, are administered medical marijuana. The demand for cannabis oil is increasing rapidly, especially among countries with legalized medical marijuana. Recent novel food ruling in Europe will further strengthen the growth of CBD isolates in the coming years. Moreover, children consuming cannabis are being prescribed with oil only, as it has shown tremendous benefits for the treatment of disorders, like epilepsy. In Feb 2021, Governor Phil Murphy signed three bills for the legalization of recreational cannabis for adults 21 years and older in New Jersey, the U.S. This is further expected to boost the market potential in the coming few months. A recent report from Grand View Research predicted that the global legal marijuana market size was valued at USD $24.6 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 14.3% from 2021 to 2028. Active Companies active today in the cannabis related markets include: Item 9 Labs Corp. (OTCQX: INLB), Curaleaf Holdings, Inc. (OTCQX: CURLF) (CSE: CURA), Green Thumb Industries Inc. (OTCQX: GTBIF) (CSE: GTII), Harvest Health & Recreation Inc. (OTCQX: HRVSF) (CSE: HARV), Jushi Holdings Inc. (OTCQB: JUSHF) (CSE: JUSH).
The Grand View Research report said: “The demand for legal marijuana is expected to surge rapidly due to changes in government policies. Several new startups are venturing into R&D, cannabis testing, and manufacturing. In Canada, many provinces are looking forward to the privatization of cannabis retail stores. Many provinces that chose a single supplier are now inviting applications from multiple suppliers. These factors are anticipated to drive the market over the forecast period. There has been a significant increase in the number of cannabis cultivators in the U.S. as the government is now accepting more applications for cannabis cultivators. In addition, the number of applications for which cannabis is prescribed is increasing. This is expected to increase cannabis sales, and thereby open new revenue channels for market players. Furthermore, the anticipated federal-level legalization of medical marijuana in the U.S. will only help this market to witness high growth opportunities in legal medical consumption.”
Item 9 Labs Corp. (OTCQX: INLB) BREAKING NEWS: Item 9 Labs Achieves Profitability for Second Quarter Fiscal Year 2021, Marking 6 Consecutive Quarters of Revenue Growth – Company reaches quarterly sales of $6.1 million, up 228% year over year and up 101% sequentially – Item 9 Labs Corp. (“Item 9 Labs,” or the “Company”), a vertically integrated cannabis dispensary franchisor and operator that produces premium products, today reported operating and financial results for the three months ended March 31, 2021, the Company’s second quarter for fiscal year 2021 (“Q2 FY2021”). The Company will be hosting an earnings call on May 18, 2021 at 11:00 AM Eastern time (8:00 AM Pacific time).
Key Financial Highlights for Q2 FY2021 (compared with Q2 FY2020)
- Revenue increased 228% to $6.1 million
- Gross profit increased 403% to $3.0 million
- Gross margin increased to 49% from 32%
- Operating income of $0.5 million (compared with operating loss of $0.9 million)
- Operating expenses as a percentage of revenue declined to 40% from 80%
- Net income of $49,020 (compared with net loss of $1.6 million)
- Adjusted EBITDA of $1.0 million (compared with adjusted EBITDA loss of $0.9 million)
Key Business Highlights during and subsequent to Q2 FY2021
- Completed the acquisition of ONE Cannabis Group (OCG Inc.), parent company of leading U.S. cannabis dispensary franchisor Unity Rd., differentiating the Company by combining its premium products with a strong retail franchise and a national distribution platform
- Unity Rd. signed agreements with three entrepreneurial groups for dispensary franchise expansion into New Jersey, in addition to a multi-unit franchise agreement with development underway in Michigan and Ohio
- Launched Orion 710 pod system, an innovative vaporization device for medical and adult-use consumers, featuring swappable one-gram pods filled with live resin blends and a USB-C rechargeable battery
Management Commentary: With the successful passage of Proposition 207 for adult use in Arizona, the state started transitioning from a medical-only into a far-larger adult-use marijuana market on January 22, 2021. Industry analysts expect the state’s total legal marijuana market will near $1.5 billion in the next three years.
“We’re seeing the impact of the strong market demand with record-breaking revenues for our premium products, reporting $6.1 million during the quarter. That’s more than double our revenues from last quarter and 228% higher than the same quarter last year,” commented Item 9 Labs Chief Executive Officer Andrew Bowden. “This quarter represents a milestone for us as it also marks our first quarter of profitability. Across the company, our team continues to execute more efficiently and manage our costs while increasing production to meet product demand.”
“We completed our acquisition of OCG Inc. during the quarter, giving us unique capabilities in franchising and positioning us for rapid scalability at reduced capital requirements, as dispensaries will be owned and operated by local franchise partners. Franchising facilitates the expansion of our national retail footprint through Unity Rd. while also serving as a distribution platform for our in-house production, enabling us to capture additional market share,” Bowden said. “We also plan to develop or partner with cultivation facilities in states where Unity Rd. franchise partners open cannabis retail shops. Already, Unity Rd. has signed multiple agreements with more than 10 entrepreneurial groups who are developing the brand across at least seven states. We are seeing growth in our franchise pipeline as lead flows and interest increase with the easing regulatory environment and state-level legalization.”
“Our planned cultivation site expansion, the first phase of which is expected to break ground soon, along with our cannabis franchising offering and the favorable regulatory climate are the catalysts that we believe will propel Item 9 Labs’ revenue and market share growth going forward,” added Bowden. CONTINUED…. Read this full Press Release and more for INLB at: https://www.financialnewsmedia.com/news-inlb
In other active company news in the markets this week:
Curaleaf Holdings, Inc. (OTCQX: CURLF) (CSE: CURA), a leading international provider of consumer products in cannabis, recently signed definitive documents to acquire the Los Sueños Farms and its related entities (“Los Sueños”), the largest outdoor grow in Colorado. This will significantly expand Curaleaf’s Coloradopresence, vertically integrating in the state with large-scale outdoor cannabis cultivation. The proposed transaction includes three Pueblo, Colorado outdoor cannabis grow facilities covering 66 acres of cultivation capacity, including land, equipment and licensed operating entities, an 1,800 plant indoor grow and two retail cannabis dispensary locations serving adult use customers.
Total base consideration for the proposed acquisition is approximately $49 million for the Los Sueños operating companies and $18 million for the real estate and farm assets. Total consideration of $67 million to be paid 61% in Curaleaf subordinate voting shares, 29% in cash at closing, and 10% in assumed debt maturing in five years. Additional contingent consideration of up to $8 million in stock will be paid based upon operating cash flow-based targets for 2022.
Green Thumb Industries Inc. (CSE: GTII) (OTCQX: GTBIF), a leading national cannabis consumer packaged goods company, recently announced the grand opening of COOKIES on the Strip (formerly Essence on the Strip), in Las Vegas on May 14. The company previously announced an exclusive partnership with COOKIES, an international cannabis brand, making this the first COOKIES store in Nevada. The retail location will sell the acclaimed portfolio of Cookies, Lemonnade, Runtz, Minntz, Powerzzzup Genetics, Collins Ave, Run The Jewels and Grandiflora products in the brand’s signature blue retail environment.
Based in the Bay Area, COOKIES was founded by prolific rapper and entrepreneur Berner, along with his partner Jai, a highly respected cannabis cultivator and breeder. With the opening of COOKIESS’ first location in Nevada, on the iconic Strip, this adds to the growing international footprint of COOKIES locations. Berner will be onsite for the grand opening, along with Rick Ross, the official COOKIES bus and other appearances by special guests.
Harvest Health & Recreation Inc. (OTCQX: HRVSF) (CSE: HARV) and Trulieve Cannabis Corp. (CSE: TRUL) (OTC: TCNNF) recently announced they have entered into a definitive arrangement agreement pursuant to which Trulieve will acquire all of the issued and outstanding subordinate voting shares, multiple voting shares and super voting shares of Harvest. Under the terms of the Arrangement Agreement, shareholders of Harvest will receive 0.1170 of a subordinate voting share of Trulieve for each Harvest subordinate voting share (or equivalent) held, representing total consideration of approximately $2.1 billion based on the closing price of the Trulieve Shares on May 7, 2021.
Jushi Holdings Inc. (OTCQB: JUSHF) (CSE: JUSH), a vertically integrated, multi-state cannabis operator, recently reported it has closed the previously announced acquisition of a 93,000 sq. ft. facility (the “Facility”), operated by its wholly-owned subsidiary and Virginia-based pharmaceutical processor, Dalitso LLC (“Dalitso”), together with approximately nine acres of surrounding land in Prince William County, Virginia, for approximately $22 million (the “Acquisition”). The Acquisition, together with Dalitso’s planned buildout of the Facility, enables Dalitso to efficiently produce a consistent supply of medical cannabis products as patient access improves and the medical cannabis program continues to mature and expand.
“We are thrilled to complete this acquisition and solidify our position in Virginia’s medical cannabis market ahead of the introduction of adult-use sales,” said Jim Cacioppo, Chief Executive Officer, Chairman, and Founder of Jushi. “The Virginia cannabis market remains an area of strategic focus for Jushi and we will work diligently to ensure Dalitso appropriately scales up its cultivation and processing capacity to meet the anticipated patient and future consumer demand of a growing program. We believe that by combining great cultivation and processing with our industry leading retail experience and high-quality brands, we have assembled the right assets to lead in this important Mid-Atlantic market.”
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