THC BioMed Intl Ltd. Turns a Profit as Revenue Breaks $1 Million


Ash Stringer

January 14th, 2020

Uncategorized


Canada’s cannabis sector has experienced a sharp sell-off over the past year, with the Marijuana Index’s Canadian Index moving from a high of $727 in March to a low of $196 in November. Rather than looking solely at growth in production capacity, many investors are shifting their focus to tangible revenue growth and profitability. Profitable licensed producers can be more selective in raising capital — limiting dilution — and generate tangible shareholder value — in the form of retained earnings.

THC BioMed Intl Ltd. (CSE: THC) (OTXQX: THCBF) (“THC BioMed”) is one of the few licensed producers that has managed to turn a profit as it broke $1 million in revenue last quarter. In addition to ramping up output, the British Columbia-based grower cited its premium cannabis and reasonable prices for helping it become a bestseller among consumers. Management’s long experience in the space — moving from Exemption 56 to ACMPR license to the Cannabis Act — has taught them how to grow great medical & recreational cannabis with unparalleled compliance.

In this article, we will take a closer look at THC BioMed’s strong quarterly performance and what catalysts investors can look forward to ahead.

Click Here To Sign Up for Company Updates and to Receive THC BioMed’s Investor Presentation

Robust Growth & Profitability

THC BioMed reported revenue that rose about 275% year-over-year to $1,044,510, during the quarter ended October 31, 2019, with an average selling price of $4.20 per gram to medical patients and recreational buyers, such as the Ontario Cannabis Store and BC Cannabis Stores. These prices are much less than the $5.00 or more reported by other licensed producers, according to data from Cannabis Benchmarks. Lower production costs could enable the company to capture market share right now, as well as provide a buffer if cannabis prices continue to fall.

Average Cost of Production for LPs – Source: Cannabis Benchmarks

On the bottom line, the company’s adjusted EBITDA swung from a loss of $345,754 to a gain of $890 after accounting for changes in the fair value of cannabis inventory, share-based compensation and other non-operational factors. Many cannabis investors are seeking out companies with profitable operations since they can be more selective when raising capital, which potentially translates to less dilution for existing shareholders and easier access to capital required to grow the business over the long-term.

On the balance sheet, the company reported $6,301,916 in total assets versus $4,188,603 in total liabilities, yielding $2,113,313 in shareholders’ equity. Many licensed producers have struggled under debt hangovers after ramping up production capacity over the past couple of years. As the market matures, companies with less debt have less of a drain on cash flow and more flexibility when it comes to capitalizing on any new opportunities that may arise. Positive net asset levels could also provide shareholders with a buffer in their valuations.

Many Irons in the Fire

THC BioMed has prudently grown its business over the past several years, but that doesn’t mean that it’s not pursuing high-growth opportunities. Last quarter, the company amended its license to include the production and sale of cannabis edibles, topicals and extracts and submitted a new product application to Health Canada for Pure Cannabis Sticks — pre-rolls that are filtered, paper cylinders filled with pure cannabis to be manufactured using its automated production machine — dramatically lowering labor costs.

In addition, the company announced an alternative, brand new cannabis beverage product, THC Kiss, and submitted a new product application to Health Canada shortly after the quarter ended. Zion Market Research projects that the global market for cannabis beverages hit $1.6 billion in 2018 and could reach $4.46 billion by 2025, representing a 15.6% compound annual growth rate. The market is growing so quickly that many traditional beverage companies, such as Constellation Brands Inc. (STZ), have made significant investments into cannabis.

Finally, the company acquired an additional strata lot at its production facility to increase grow capacity. Management’s unique approach to growing cannabis also ensures the highest-quality products reach consumers — from selecting only the best feminized seeds to hand-trimming at the perfect time and placing product on drying racks to dry and cure over an extended period of time. The combination of low-cost production methods and experience growing premium cannabis creates an easy bestseller.

Looking Ahead

THC BioMed Intl Ltd. (CSE: THC) is one of the few licensed producers that have achieved profitability on the bottom line. As the market shifts their portfolios from growth to value, investors may want to keep an eye on the company that has prudent financial discipline and plenty of potential catalysts ahead. It’s long track record shows that management has been able to balance these objectives and deliver shareholder value with an eye for creating low-cost, high-value products for consumers.

To Learn more about THC BioMed (CSE: THC) (OTCQX: THCBF) visit the Company’s Website: https://thcbiomed.com

Disclaimer

CannabisFN.com is not an independent financial investment advisor or broker-dealer. You should always consult with your own independent legal, tax, and/or investment professionals before making any investment decisions. The information provided on https://www.cannabisfn.com (the ‘Site’) is either original financial news or paid advertisements drafted by our in-house team or provided by an affiliate. CannabisFN.com, a financial news media and marketing firm enters into media buys or service agreements with the companies that are the subject of the articles posted on the Site or other editorials for advertising such companies.  We are not an independent news media provider. We make no warranty or representation about the information including its completeness, accuracy, truthfulness or reliability and we disclaim, expressly and implicitly, all warranties of any kind, including whether the Information is complete, accurate, truthful, or reliable. As such, your use of the information is at your own risk. Nor do we undertake any obligation to update the items posted. CannabisFN.com received compensation for producing and presenting high quality and sophisticated content on CannabisFN.com along with financial and corporate news.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

Avatar

About Ash Stringer



Network Partners

Follow Us on Social Media

About CFN Media Group

CFN Enterprises Inc. (OTCQB: CNFN) owns and operates CFN Media Group, the premier agency and financial media network reaching executives, entrepreneurs and consumers worldwide. Through its proprietary content creation, video library, and distribution via www.CannabisFN.com, CFN has built an extensive database of cannabis interest, assisting many of the world’s largest cannabis firms and CBD brands to build awareness and thrive. For more information, please visit www.cfnenterprisesinc.com.

Disclaimer: Matters discussed on this website contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time-to-time have a position in the securities mentioned herein and will increase or decrease such positions without notice. The Information contains forward-looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, or projections as indicated by such words as "expects", "will", "anticipates", and "estimates"; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation of the Information and the Profiled Issuer as well as any such forward-looking statements. Any forward looking statements we make in the Information are limited to the time period in which they are made, and we do not undertake to update forward looking statements that may change at any time; The Information is presented only as a brief "snapshot" of the Profiled Issuer and should only be used, at most, and if at all, as a starting point for you to conduct a thorough investigation of the Profiled Issuer and its securities and to consult your financial, legal or other adviser(s) and avail yourself of the filings and information that may be accessed at www.sec.gov, www.pinksheets.com, www.otcmarkets.com or other electronic sources, including: (a) reviewing SEC periodic reports (Forms 10-Q and 10-K), reports of material events (Form 8-K), insider reports (Forms 3, 4, 5 and Schedule 13D); (b) reviewing Information and Disclosure Statements and unaudited financial reports filed with the Pink Sheets or www.otcmarkets.com; (c) obtaining and reviewing publicly available information contained in commonlyknown search engines such as Google; and (d) consulting investment guides at www.sec.gov and www.finra.com. You should always be cognizant that the Profiled Issuers may not be current in their reporting obligations with the SEC and OTCMarkets and/or have negative signs at www.otcmarkets.com (See section below titled "Risks Related to the Profiled Issuers, which provides additional information pertaining thereto). For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity-based compensation in the companies it writes about, or a combination of the two. For full disclosure, please visit: https://www.cannabisfn.com/legal-disclaimer/. A short time after we acquire the securities of the foregoing company, we may publish the (favorable) information about the issuer referenced above advising others, including you, to purchase; and while doing so, we may sell the securities we acquired. In addition, a third-party shareholder compensating us may sell his or her shares of the issuer while we are publishing favorable information about the issuer. Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time to time have a position in the securities mentioned herein and will increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity- based compensation in the companies it writes about, or a combination of the two. For full disclosure please visit: https://www.cannabisfn.com/legal-disclaimer/.

Copyright © Accelerize Inc. · All Rights Reserved · Privacy Policy · Legal Disclaimer

loading