Cannabis
Zenabis Global Announces First Quarter 2019 Financial Results
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Zenabis Global Inc. (TSX:ZENA) (“Zenabis” or the “Company“) today announced its financial results for the first quarter ended March 31, 2019 and provided an update on operations. This is Zenabis’ first quarterly financial report since the public listing of its shares in January of 2019.
“The public listing of our shares, and our recent graduation to the Toronto Stock Exchange, reflect the ambitions we have for our company, and are important milestones in the Zenabis growth story,” said Andrew Grieve, Chief Executive Officer of Zenabis. “We have successfully undertaken a range of tangible corporate development initiatives in the past several months, including securing key supply and distribution arrangements and additional licenses and approvals; expanding our product offerings across Canada, developing relationships in Europe; and obtaining financing to support our rapid growth. We also commenced providing monthly reports on our operations and look forward to continuing to update our shareholders and the broader investment community on our progress.”
“Since the legalization of cannabis in Canada last fall, it has become clear that the winners in this industry will be those who can produce reliable supply,” continued Mr. Grieve. “Despite being a new entrant in the cannabis market, we demonstrated a clear ability to expand production and cultivation output during the first quarter of 2019. Our April 2019output exceeded our design capacity by more than 31%, and our overall cultivation output was 63% greater than forecast. For the three harvests thus far in May, we have exceeded design capacity by 28%. With an additional harvest being accelerated from June into May, we anticipate further strong total cultivation performance in May relative to forecast. This outperformance demonstrates the capabilities of our experienced cultivation team, and the quality of our facilities across Canada.”
“Our results demonstrate progress towards our goal of becoming one of the largest licensed producers of medical and adult-use recreational cannabis in Canada. Building on the proven agricultural heritage and cultivation excellence of our predecessor company, Bevo Agro Inc., we are investing in initiatives that will grow our production to meet demand across our key markets, enhance value for our shareholders, and deliver value to all of our stakeholders. Looking ahead, we expect further growth from our cannabis operations, continued expansion of our facilities, and significant increases in cannabis revenue,” added Mr. Grieve.
Commenting on Zenabis’ revenue growth expectations for the second quarter of 2019, Mr. Grieve said, “We currently anticipate revenue from the plant propagation business to be in a range of $16 to $18 million, and net revenue from the cannabis business to be in the range of $10 to $12 million. Net cannabis revenue is subject to the timing of shipments. This net cannabis revenue does not yet include any meaningful impact from the production of oil products, as the third-party supply chain for oil products (including post processing) adds a considerable amount of time from cultivation to realization of revenue. This time differential is expected to be significantly reduced upon completion of post-processing and additional extraction capacity at Zenabis Delta. Currently, a significant amount of existing cannabis inventory is allocated to the third-party oil processing supply chain.”
First Quarter 2019 Highlights:
- Completed a reverse takeover (the “RTO”) of Bevo Agro Inc. by Sun Pharm Investments Ltd. to become Zenabis Global Inc. on January 8, 2019, and began trading on the TSX Venture Exchange (“TSXV”) under the symbol “ZENA” on January 10, 2019
- Entered into supply arrangements with the provinces of Alberta, Manitoba, Quebec and Prince Edward Island, expanding Zenabis’ supply arrangements to a total of eight provinces and one territory
- Through its subsidiary, Bevo, completed the acquisition of Topgro Holdings Ltd., which includes 10.4 acres of greenhouse on 50 acres of land in Aldergrove, British Columbia
- Added a new product line with the acquisition of 51% of Hilllsboro Corp Inc., a kombucha company with expertise in the creation of cultured tea beverages
- Entered into supply agreement with Shoppers Drug Mart, one of Canada’s most significant retailers
- Received approval to cultivate and grow cannabis at its 255,000 square foot facility in Stellarton, Nova Scotia, with the initial licensed area adding design capacity of 800 kilograms of dried cannabis per year
- Obtained a license to process and sell cannabis oil products in Canada, enabling Zenabis to sell cannabis oil produced at its Atholville, New Brunswick facility
- Achieved cultivation output of 1,472 kg, 11% greater than design capacity of 1,330 kg
- Achieved financial performance in line with ramp-up expectations, including:
- Total gross revenues of $12.3 million and net revenues of $11.6 million after excise taxes
- Gross margin before fair value adjustment of $3.9 million
- Operating expenses of $18.8 million
- Adjusted EBITDA1 of ($6.4 million)
- Net loss of $4.0 million
Recent Developments
- Since the creation of Zenabis via the January 2019 RTO, more than doubled licensed production capacity from 6,000 kg to 13,400 kg as at May 30, 2019
- Delivered 31% outperformance relative to cultivation design capacity in April, with cultivation output of 809 kg, 63% greater than our forecast of 495 kg
- Received license approval for Phase 2A at the Atholville facility, adding 3,200 kg, or more than 30% to Zenabis’ total cannabis cultivation capacity
- Continued construction and licensing activity at both its Atholville and Langley facilities, with forecast annual production capacity of 131,300 kg by the end of the third quarter of 2019
- Expanded recreational cannabis product offerings to include pre-roll products under a new ultra-premium brand, Blazery, as well as pre-roll and oil products under its existing recreational brand, Namaste
- Entered into a binding term sheet for a three-year supply arrangement with leading German pharmaceutical research company Farmako GmbH (“Farmako”) for the supply of biosynthetically produced pure CBD isolate oil (99.9%) from Farmako to Zenabis for sale in Canada; and the supply of European Union Good Manufacturing Practices certified cannabis cultivated in Zenabis’ indoor facilities in Canada for sale by Farmako to the German medical market
- Graduated to the Toronto Stock Exchange (“TSX”) from the TSXV, effective on May 27, 2019, with the Company’s common shares and common share purchase warrants continuing to trade under the symbols “ZENA” and “ZENA.WT”, respectively
Summary First Quarter 2019 Financial Results
All amounts, unless specified otherwise, are expressed in Canadian dollars and are presented in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting.
For the quarter ended March 31, 2019, Zenabis recorded net revenues of $11.6 million, which was comprised primarily of $4.1 million and $7.5 million in Cannabis and Propagation segments, respectively, less inter-segment revenue of $0.3 million. Comparatively, in the three months ended December 31, 2018, the Company recorded net Cannabis revenue of $3.4 million, and in the three months ended March 31, 2018, the Company had not yet begun cannabis sales.
Gross margin before fair value adjustment totaled $3.9 million during the three months ended March 31, 2019, and includes $2.1 million and $1.6 million in Cannabis and Propagation gross margin, respectively, before fair value adjustments (51% and 21% as percent of net revenue by segment, respectively). Comparatively, in the three months ended December 31, 2018, Zenabis recorded a Cannabis gross margin before fair value adjustment of $1.7 million (50% of net revenue).
Total operating expenses for the quarter ended March 31, 2019 were $18.8 million, of which $4.9 were acquisition costs, which compares to $12.7 million in the three months ended December 31, 2018. Gain on the revaluation of derivative liability was $7.9 million in the 2019 first quarter compared to a loss of $13.1 million for Q4 2018, which was the result of fluctuations in the Company’s share price. Share-based compensation was $2.1 million in Q1 2019 compared to $4.6 million in Q4 2018, due to various options that were vested on an accelerated basis in the previous quarter, which was not the case in the current quarter. Finance and investment income was $1.1 million in Q1 2019 compared to a loss of $1.9 million in Q4 2018 due to an increase in the market value of investments held by the Company. Offsetting these amounts were $4.9 million in first quarter 2019 acquisition costs related to the RTO and other business acquisition transactions, compared to $74,900 in Q4 2018; Q1 2019 interest expense of $4.6 million compared to $1.2 million in Q4 2018, which was due to the additional debt the Company issued or assumed in late Q4 2018 and in Q1 2019; and depreciation and amortization of $1.5 million in Q1 2019 compared to $0.3 million in Q4 2018, which was primarily the result of the various facilities being ready and available for use.
Adjusted EBITDA1 has continued to show a loss due to the operational costs incurred by Zenabis to build-out its operational capacity to achieve the planned production capacity of its various facilities. Adjusted EBITDA has not improved in comparison to the three months ending December 31, 2018 due to the increase in operating costs which are primarily due to the development and implementation of the resources and capacity needed by the Cannabis segment to support the facilities under construction that will be producing in 2019. The additional expenses are partially offset by the increase in sales and margins realized through the Company’s Cannabis and Propagation segments. First quarter 2019 Adjusted EBITDA was ($6.4 million), compared to ($6.0 million) in Q4 2018.
The Company recorded a net loss for the three months ended March 31, 2019 of $4.0 million, or $0.02 loss per common share, compared to a net loss of $24.9 million, or $0.16 loss per common share, for the three months December 31, 2018.
Cash on hand increased to $25.6 million as at March 31, 2019 from $17.0 million at December 31, 2019. The increase in cash was mainly attributable to cash received from financing of $56.6 million, offset by cash used in operating activities of $17.6 million and investing activities of $30.3 million.
SOURCE Zenabis Global Inc.
TORONTO and GLIL YAM, Israel, Sept. 11, 2024 /PRNewswire/ — IM Cannabis Corp. (“IMC” or the “Company“) (NASDAQ: IMCC) (CSE: IMCC), a leading medical cannabis company with operations in Israel and Germany, is pleased to announce that Mr. Shmulik Arbel has been appointed to the Company’s board of directors (the “Board“) effective September 9, 2024. Mr. Arbel brings a wealth of experience in strategic plans that drive profitability, as well as, finance and corporate governance, further strengthening the company’s commitment to driving growth while focusing on sustainable profitability.
“We are thrilled to welcome Shmulik to our Board of Directors,” said Oren Shuster, Chief Executive Officer of IM Cannabis. “Shmulik’s extensive international experience at Leumi, coupled with his proven track record in banking and finance will be invaluable as we continue to deliver on our strategic initiatives.”
Mr. Arbel retired as Deputy CEO from Leumi, Israel’s largest banking group, in April 2023, where he was instrumental in business growth and leading the service revolution. With over 25 years of experience at Leumi, Arbel has held senior roles throughout the organization, such as head of retail banking, head of the corporate division, and as chairman of Leumi UK. With key roles in Israel, New York and London, Mr. Arbel has a wide view on international business.
“I am honored to join the Board of Directors at IMCC,” said Mr. Arbel. “I look forward to leveraging my experience in banking and finance, providing guidance as IMCC continues to establish itself as the go-to brand in the cannabis world. I look forward to contributing to the company’s growth.”
Arbel holds a BA and MBA from Tel Aviv University.
About IM Cannabis Corp.
IMC (Nasdaq: IMCC) (CSE: IMCC) is an international cannabis company that provides premium cannabis products to medical patients in Israel and Germany, two of the largest medical cannabis markets. The Company has focused its resources to achieve sustainable and profitable growth in its highest value markets, Israel and Germany. The Company leverages a transnational ecosystem powered by a unique data-driven approach and a globally sourced product supply chain. With an unwavering commitment to responsible growth and compliance with the strictest regulatory environments, the Company strives to amplify its commercial and brand power to become a global high-quality cannabis player.
The IMC ecosystem operates in Israel through its commercial relationship with Focus Medical Herbs Ltd., which imports and distributes cannabis to medical patients, leveraging years of proprietary data and patient insights. The Company also operates medical cannabis retail pharmacies, online platforms, distribution centers, and logistical hubs in Israel that enable the safe delivery and quality control of IMC products throughout the entire value chain. In Germany, the IMC ecosystem operates through Adjupharm GmbH, where it distributes cannabis to pharmacies for medical cannabis patients.
Disclaimer for Forward-Looking Statements
This press release contains forward-looking information or forward-looking statements under applicable Canadian and United States securities laws (collectively, “forward-looking statements“). All information that addresses activities or developments that we expect to occur in the future are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “believe”, “plan”, “estimate”, “expect”, “likely” and “intend” and statements that an event or result “may”, “will”, “should”, “could” or “might” occur or be achieved and other similar expressions. Forward-looking statements are based on the estimates and opinions of management on the date the statements are made. In the press release, such forward-looking statements include, but are not limited to, statements relating to: the stated benefits Mr. Arbel’s appointment, including the further strengthening the Company’s commitment to driving growth in the German market while focusing on sustainable profitability; and Mr. Arbel’s international experience and track record in banking and finance will be invaluable to the Company.
Forward-looking statements are based on assumptions that may prove to be incorrect, including but not limited to: the Company’s ability to realize upon the stated benefits Mr. Arbel’s appointment; and Mr. Arbel’s international experience and track record in banking and finance becoming invaluable to the Company.
The above lists of forward-looking statements and assumptions are not exhaustive. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated or implied by such forward-looking statements due to a number of factors and risks. These include: the failure of the Company to comply with applicable regulatory requirements in a highly regulated industry; unexpected changes in governmental policies and regulations in the jurisdictions in which the Company operates; the Company’s ability to continue to meet the listing requirements of the Canadian Securities Exchange and the NASDAQ Capital Market; any unexpected failure to maintain in good standing or renew its licenses; the ability of the Company and its subsidiaries (collectively, the “Group“) to deliver on their sales commitments or growth objectives; the reliance of the Group on third-party supply agreements to provide sufficient quantities of medical cannabis to fulfil the Group’s obligations; the Group’s possible exposure to liability, the perceived level of risk related thereto, and the anticipated results of any litigation or other similar disputes or legal proceedings involving the Group; the impact of increasing competition; any lack of merger and acquisition opportunities; adverse market conditions; the inherent uncertainty of production quantities, qualities and cost estimates and the potential for unexpected costs and expenses; risks of product liability and other safety-related liability from the usage of the Group’s cannabis products; supply chain constraints; reliance on key personnel; the risk of defaulting on existing debt; risks surrounding war, conflict and civil unrest in Eastern Europe and the Middle East, including the impact of the Israel-Hamas war on the Company, its operations and the medical cannabis industry in Israel; risks associated with the Company focusing on the Israel and Germany markets; the inability of the Company to achieve sustainable profitability and/or increase shareholder value; the inability of the Company to actively manage costs and/or improve margins; the inability of the company to grow and/or maintain sales; the inability of the Company to meet its goals and/or strategic plans; the inability of the Company to reduce costs and/or maintain revenues; the Company’s inability to take advantage of the legalization of medicinal cannabis in Germany; and the Company’s inability to realize upon the stated benefits Mr. Arbel’s appointment; and Mr. Arbel’s international experience and track record in banking and finance not becoming valuable to the Company.
Please see the other risks, uncertainties and factors set out under the heading “Risk Factors” in the Company’s annual report dated March 28, 2024, which is available on the Company’s issuer profile on SEDAR+ at www.sedarplus.ca and Edgar at www.sec.gov/edgar. Any forward-looking statement included in this press release is made as of the date of this press release and is based on the beliefs, estimates, expectations and opinions of management on the date such forward looking information is made. The Company does not undertake any obligation to update forward-looking statements except as required by applicable securities laws. Investors should not place undue reliance on forward-looking statements. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
Company Contact:
Anna Taranko, Director Investor & Public Relations
IM Cannabis Corp.
+49 157 80554338
[email protected]
Oren Shuster, CEO
IM Cannabis Corp.
[email protected]
Logo: https://mma.prnewswire.com/media/1742228/IM_Cannabis_Logo.jpg
View original content:https://www.prnewswire.co.uk/news-releases/im-cannabis-announces-appointment-of-shmulik-arbel-to-board-of-directors-302244961.html
Cannabis
Europe Medical Cannabis Market Forecast 2024-2032: Tilray, Aurora Cannabis, and GW Pharmaceuticals Dominate the Market Landscape
Dublin, Aug. 29, 2024 (GLOBE NEWSWIRE) — The “Europe Medical Cannabis Oil Market Size, Industry Dynamics, Opportunity Analysis and Forecast 2024-2032.” report has been added to ResearchAndMarkets.com’s offering.
The Europe Medical Cannabis Oil market is poised for significant growth, projected to escalate from US$ 0.91 billion in 2023 to US$ 2.40 billion by 2032, advancing at a CAGR of 12.08%. In this comprehensive research report, the market is analyzed by:
- Derivatives;
- Source;
- Application;
- Route of Administration;
- End-user;
- Distribution Channel; and
- Country.
Market Highlights Identified in the Report
- Progressive legalization across Europe is creating a favorable regulatory environment, enhancing market expansion for medical cannabis oil products.
- Germany leads the market with a robust infrastructure and supportive regulations, while other countries like the UK, Italy, and Spain show significant growth potential based on evolving regulatory landscapes and market dynamics.
- Key players such as Tilray, Aurora Cannabis Inc., and GW Pharmaceuticals dominate the market, emphasizing research, strategic partnerships, and innovation to maintain competitive edge amidst evolving industry dynamics.
The medical cannabis oil market has experienced substantial growth as legalization and acceptance of cannabis-based treatments expand globally. Cannabis oil, derived from the cannabis plant through extraction methods, contains cannabinoids such as THC and CBD, known for their therapeutic properties. Increasing recognition of cannabis oil’s potential in alleviating symptoms of various medical conditions, including chronic pain, epilepsy, and anxiety disorders, has driven its adoption in medical settings.
Governments in several countries are progressively legalizing medical cannabis, creating a conducive regulatory environment for market expansion. Additionally, growing consumer awareness about alternative and natural therapies has fueled the demand for cannabis oil products. The market is characterized by diverse product offerings, including full-spectrum and CBD-isolate oils, catering to different therapeutic needs and preferences.
Despite regulatory challenges and stigma associated with cannabis, the medical cannabis oil market continues to evolve, driven by ongoing research, favorable legislative changes, and shifting attitudes toward cannabis-based therapies in healthcare.
Regional Insights
Germany is likely to maintain its leadership position in the European medical cannabis oil market due to its established infrastructure, supportive regulations, and strong healthcare system. Germany legalized medical cannabis in 2017, giving the market a head start compared to many other European countries. This established infrastructure and experience position Germany as a leader in the field. As awareness and acceptance of medical cannabis increase, the number of patients seeking treatment in Germany is steadily rising. This fuels market growth and incentivizes further investment in research and development.
Germany’s regulatory framework for medical cannabis is considered relatively patient-friendly compared to some other European countries. This facilitates access for patients with qualifying conditions. The UK legalized medical cannabis in 2018 and is experiencing an increase in patient access programs. This, coupled with ongoing research, could lead to significant market growth. Italy legalized medical cannabis in 2006 but has faced challenges with availability. As regulations become more streamlined and patient access expands, the Italian market holds significant growth potential. Spain has a well-established medical cannabis industry with a focus on domestic production. As regulations evolve and export opportunities increase, the Spanish market could see a boost.
Competitive Landscape
The Medical Cannabis Oil market is characterized by a vigorous competitive landscape, with prominent entities like Tilray, Aurora Cannabis Inc., GW Pharmaceuticals, Almiral, Bedrocan, and others at the forefront, collectively accounting for approximately 41 % of the overall market share. This competitive milieu is fueled by their intensive efforts in research and development as well as strategic partnerships and collaborations, underscoring their commitment to solidifying market presence and diversifying their offerings.
The primary competitive factors include pricing, product caliber, and technological innovation. As the Medical Cannabis Oil industry continues to expand, the competitive fervor among these key players is anticipated to intensify. The impetus for ongoing innovation and alignment with evolving customer preferences and stringent regulations is high. The industry’s fluidity anticipates an uptick in novel innovations and strategic growth tactics from these leading corporations, which in turn propels the sector’s comprehensive growth and transformation.
Key Topics Covered
Chapter 1. Research Framework
Chapter 2. Research Methodology
Chapter 3. Executive Summary: Europe Medical Cannabis Oil Market
Chapter 4. Europe Medical Cannabis Oil Market Overview
Chapter 5. Europe Medical Cannabis Oil Market Analysis, by Derivatives
Chapter 6. Europe Medical Cannabis Oil Market Analysis, by Source
Chapter 7. Europe Medical Cannabis Oil Market Analysis, by Application
Chapter 8. Europe Medical Cannabis Oil Market Analysis, by Route of Administration
Chapter 9. Europe Medical Cannabis Oil Market Analysis, by End-user
Chapter 10. Europe Medical Cannabis Oil Market Analysis, by Distribution Channel
Chapter 11. Europe Medical Cannabis Oil Market Analysis, by Country
Chapter 12. The UK Medical Cannabis Oil Market Analysis
Chapter 13. Germany Medical Cannabis Oil Market Analysis
Chapter 14. The Netherlands Medical Cannabis Oil Market Analysis
Chapter 15. Italy Medical Cannabis Oil Market Analysis
Chapter 16. Spain Medical Cannabis Oil Market Analysis
Chapter 17. Poland Medical Cannabis Oil Market Analysis
Chapter 18. Rest of Europe Medical Cannabis Oil Market Analysis
Chapter 19. Company Profiles (Company Overview, Financial Matrix, Key Product Landscape, Key Personnel, Key Competitors, Contact Address, and Business Strategy Outlook)
A selection of companies mentioned in this report includes, but is not limited to:
- Aurora Cannabis Inc.
- Bedrocan
- Biocann
- BIOTA Biosciences LLC
- Cannamedical
- Mary Jane CBD
- Sanity Group GmbH
- Tilray
- Valcon Medical
For more information about this report visit https://www.researchandmarkets.com/r/dh7q46
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