SpeakEasy Cannabis Club Ltd. (CSE: EASY) (Frankfurt: 39H) (the “Company” or “SpeakEasy“), a holder of a federal licence to cultivate, process and sell cannabis under the Cannabis Act, today revealed its plans to transform into a global cannabis brand by applying large scale commercial farming principles to burgeoning national and international markets. Building on the Geen family’s 100 years of experience farming cherries, apples, ginseng and peaches, the Company plans to cultivate small batch, high quality craft cannabis and, subject to receipt of all applicable licences from Health Canada, produce approximately 70,000kg of outdoor sun-grown cannabis in 2020.

The Company expects that in 2020 there will be a shift in the global cannabis industry into a consumer-packaged goods industry with the introduction of new product categories and increased segmentation in existing ones. SpeakEasy has developed a business model that adds core value and amplifies brand differentiation in what is expected to be a flourishing market. Building on its solid foundation, the Company will identify international revenue sources and replicate its operations in emerging global cannabis markets.

Moving from speculation to reality, a correction in the industry has taken place as dissatisfaction with current product offerings impacts sales projections. By focusing on both indoor and outdoor cultivation and following the proven business frameworks of successful multinational farming cooperatives, SpeakEasy is positioned to cultivate premium BC cannabis and deliver significant revenues and cost efficiencies.

“The blueprint to agricultural success must begin with proper site selection. It is the foundation of all farming,” says SpeakEasy Founder, Marc Geen. “As a fourth generation farmer benefitting from the Okanagan’s fertile golden mile, we have an intrinsic understanding of the land and how to cultivate and grow.”

Strategic Direction

Indoor cultivation: SpeakEasy completed the construction of its 10,000 sq. ft. purpose built indoor facility in November 2019, bringing its total indoor growing space, once all the buildings are completed, to approximately 63,000 sq. ft. SpeakEasy applies craft cultivation techniques to grow premium craft cannabis in this space. To target the luxury cannabis market large corporations have started to invest in small batch producers, for instance Aphria purchased B.C company Broken Coast for $230m. With legacy growers benefitting from over 100 years of combined experience, SpeakEasy is well positioned to produce high margin small batch cannabis.

SpeakEasy founder Marc Geen says, “We don’t need to look far to see what happens in a mature cannabis market, high quality, actual high quality becomes the norm and sells well, mid or low quality simply does not sell. SpeakEasy is fixated on producing the best quality possible in our purpose built tried and true facilities.”

Outdoor cultivation: SpeakEasy projects that delivering cost efficiencies will be essential as cannabis transforms into a global consumer packaged goods industry. The Company projects that outdoor cultivation will enable it to produce trimmed flower for approximately $0.04 per gram and biomass for extraction at approximately $0.02 per gram. The Company has recently built an outdoor facility and has applied for an outdoor cultivation licence, which it anticipates receiving in Q1 2020.

CBD hemp plantation: SpeakEasy expects to plant a minimum of 50 acres of hemp in 2020 in an outdoor field, that was fully prepared in the fall of 2019. By controlling input costs by producing their own hemp, coupled with innovative extraction methods, SpeakEasy projects its cost to produce a 80% CBD distillate to be under $1,000/kg versus current prices that can run as high as $30,000/kg, allowing the Company to enter global markets at a competitive price.

Consumer facing brands: SpeakEasy is building real brands for the future with the development of multiple consumer products, including high THC flower, medical cannabis and CBD products. SpeakEasy believes that to succeed in the competitive cannabis market, brands must be developed authentically to engage and resonate with consumers. By harnessing legacy growers and an extensive library of unique genetics, the Company will be able to produce high quality small batch cannabis indoors and exceptionally low cost flower for extraction purposes outdoors.

Online sales: Domestic cannabis markets have been restricted by availability and supply chain issues. To meet the needs of the modern consumer and improve supply chain resilience, SpeakEasy has undertaken projects to become vertically integrated through BWell – the first CBD e-commerce marketplace in Canada. The initiative will enable the Company to acquire new customers at a low cost and expand upon a business model that mirrors Amazon’s marketplace approach. Management expects that this marketplace approach will advance SpeakEasy’s aim to become a recognized household name across North America.

Extraction processing: The introduction of new product categories has the potential to add significant revenue streams for companies with extraction capabilities. To capitalize on this opportunity SpeakEasy is developing a state-of-the art 26,000 sq. ft. extraction facility, which it expects to complete in Q3 2020. Once in service, the Company expects to augment operations by processing up to 350,000kg of cannabis annually.

2020 Timeline of Project Completion Dates:

Q1 – Outdoor License Amendment, Hemp Field License & First Harvest
Q2 – Outdoor Planted, Hemp Fields Planted
Q3 – Extraction/Processing & Cooler Building
Q4 – Product on shelves

“We started out differently than most by beginning everything we do with the simple question, what do our customers want, and we built everything with that in mind. Consumer wants and needs cannot be an afterthought or something we figure out later, it is the sole purpose for everything we do,” says Founder, Marc Geen. “Quality, genetics, product types and pricing all need to make a formula that works to supply our customers. SpeakEasy has never been a stock play, it has always been a business built from the ground up with a long bright future in front of it.”

SOURCE Speakeasy Cannabis Club Ltd.