Debra BorchardtSeptember 12, 2022
JRMI27 was producing BellRock's Dixie brands in Michigan
Dixie Brands Archives - Green Market Report
Debra BorchardtSeptember 12, 2022Debra BorchardtJanuary 9, 2020Dixie Brands Inc. (CSE: DIXI.U) (OTCQX: DXBRF) said that it closed out 2019 in the Michigan market on a high. The cannabis brand company entered the Michigan cannabis market through a packaging and supply agreement with Choice Labs in February of 2019. It helped Dixie grow its sales by 108% and increased dispensary penetration by 33% in the fourth quarter.
“Expanding into the great state of Michigan was a priority for Dixie in 2019 and the incredible results we have managed to achieve so quickly are a testament to the strength of our brands and the expertise of both our production and commercial teams,” said Chuck Smith, President, and CEO, Dixie Brands. “And this is only the beginning! With the approval of recreational use, we expect the market to grow exponentially and Dixie’s portfolio is well-positioned to expand on its market-leading position into 2020 and beyond.”
According to the Detroit Free Press, Michigan is the second-largest medical cannabis market in the country with over 300,000 registered medical cannabis patients driving $30 million in annual retail sales. The state just initiated its legal adult-use cannabis sales in December and that market is projected to grow to $1.5 billion by the end of 2021. Still, the rollout has been slow with only 21 retail licenses awarded and roughly 80% of the cities in the state have opted out. Recreational marijuana sales managed to hit $6.5 million in December alone.
Dixie says it chose its partner will as Choice Labs is one of only four processors that were given a recreational license. Dixie said it launched its portfolio of branded products in early 2019 and then quadrupled the number of available SKU’s by the end of April in response to the positive reaction from both retailers and consumers. Since launching in February of 2019, Dixie has established itself as a powerhouse brand in the state with over 70% dispensary penetration and demand consistently outstripping supply.
CEO Chuck Smith spoke with Green Market Report in June of 2019 and said, “We had said at the beginning of the year that we were going to open up between four and six new states that would be adding to the four states that we already have. So, our goal is really in between eight and 10 new states. Oklahoma is our sixth.”
StaffNovember 27, 2019
It’s time for your Daily Hit of cannabis financial news for November 27, 2019.
On The Site
Green Wednesday
While most people are starting to do Thanksgiving cooking on the Wednesday before, cannabis industry professionals prepare for one of the biggest sales days of the year. It’s known as Green Wednesday. Consumers stock up on cannabis for the holiday weekend that might be fraught with family tension.
According to new data by BDS Analytics, “In 2018, November 23rd had the highest cannabis sales of any other day during the entire month of November with over $6.2 million in sales on that day alone, which is 60% higher than the average daily sale day in November 2018 and accounted for over 5% of that month’s revenue.”
Busted Deals
The bear market for the cannabis industry is leading to the unwinding of deals that had great promise. Cannabis companies are no longer willing to write big checks with fingers crossed that the market will just continue to boom. Two of these deals were terminated after great fanfare.
Cresco Labs
Cresco Labs (CSE:CL) (OTCQX:CRLBF) said it was ending its plan to acquire Florida-based VidaCann Ltd. which was originally announced on March 18, 2019. It was valued at $120 million when it was first announced.
SOL Global
SOL Global Investments Corp.’s (CSE: SOL) (OTCPK: SOLCF) said it decided against its deal with MCP Wellness to that was agreed to on April 23, 2019. SOL was to buy MCP Wellness for $35 million in cash and S$115 million in equity consideration in CannCure.
MCP is the Merida Capital Partners affiliate that owns the rights to own three Michigan cultivation licenses, a processing license, 9 licensed and operating dispensaries and 6 additional dispensary licenses, giving it the largest retail footprint in the state of Michigan.
Massachusetts
A year has passed since Massachusetts began sales its sale of legal adult-use cannabis and while the state showed no interest in rushing the matter, customers showed their interest as they rushed to the stores.
One year later, the state reported that licensees generated $393.7 million in gross sales and that 33 dispensaries had been licensed. The customer demand is high, but the inventory is low. There aren’t many licensed cultivators in the state of Massachusetts, leaving little room for excess.
In Other News
Dixie Brands
Dixie Brands Inc. (CSE: DIXI.U), (OTCQX: DXBRF) announced its third quarter 2019 financial results with revenue increasing 28% to $3,121,211 in Q3 2019, compared to $2,435,398 in Q3 2018. Sequential quarterly revenue increased, up from $2,995,310 in Q2 2019. Revenue growth was driven by sustained presence and increased dispensary penetration in established markets, increasing traction in the key California market, continued growth in Michigan, and the introduction of new products.
Net loss attributed to the Company in Q3 2019 of $4,915,807 was lower by $1,853,750 compared to the Q2 2019 loss of $6,769,557. The lower net loss was due to more efficient general and administrative spending. The Q3 2019 net loss includes $2,245,413 of non-cash expenses resulting primarily from stock options issued as compensation for key management and external service providers. Dixie had $892,312 of cash at September 30, 2019.
MariMed
MariMed Inc. (MRMD:OTCQX) reported results for the quarter ending September 30, 2019. Filing of the Company’s 10-Q for the quarter was delayed awaiting receipt from GenCanna Global, in which MariMed, Inc. holds a 33.5% interest, of its operating results for the quarter., As previously reported, GenCanna experienced a major fire at its Kentucky facility in early November. Financial comparisons are to the same year-ago periods unless otherwise noted.
Total revenues increased 230.9% to $11.22 million compared to the same period of 2018. Of that total, cannabis revenues grew 24.1% to $4.21 million, while MariMed’s hemp division reported revenue primarily from seed sales, of $7.01 million in the quarter. Total operating income for the period increased to $973,000, up from an operating loss of $549,000. Overall, the Company reflected a loss for the quarter of $7.30 million primarily due to interest expense on short-term borrowings to fund hemp seed purchases, as well as the Company’s equity in the net loss reported by GenCanna. The GenCanna loss stems primarily from a one-time adjustment totaling $6.10 million relating to market value adjustments for product.
Video StaffJuly 22, 2019
This interview was recorded on June 25, 2019, at the MJ Link Micro Investor conference in New York.
Debra Borchardt, Editor-in-Chief, Green Market Report:
Dixie Brands Inc. (OTCPK:DXBRF) just got approved for Oklahoma, its sixth state. Joining me now is the CEO, Chuck Smith. So, very exciting, Oklahoma, your number six state and a pretty good patient population there, right?
Chuck Smith, CEO Dixie Brands:
It sure is, Debra. It’s about 130,000 patients, very broad qualifying conditions, so that makes it kind of perfect for a company like ours, has a very big product portfolio. We can really serve a lot of different patient needs with our existing product set.
Green Market Report
Your product, I have to say, it tastes good. That’s one of the issues that we have with beverages.
Chuck Smith
So, you could say it tastes great.
Green Market Report
Ok, it tastes great. So many of the cannabis beverages, they just make me cringe, and they taste awful, but your product doesn’t. It tastes good.
Chuck Smith
Well, thanks very much for that. I think all of our products taste really good, and that’s something we’re proud of, but that’s also why we’ve been around for nine years. Having nine years to actually perfect the formulations, understand how to work with the oil, understand how to bring the right kind of flavor profiles together in a great responsible way, but also attractive packaging, I think that’s a cornerstone of Dixie Brands. As we evolve, the consumer is demanding that too. We have to continue to evolve that technology to make sure that the products are consistent, reliable, and taste great in every single state that we market it to.
Green Market Report
You recently reported your earnings. Your revenue’s phenomenal. It was up 137%, so your sales are growing tremendously. I did want to ask you about your net losses, $6.6 million. Quite high. A lot of that was compensation, but to your point, you said the company’s been around for nine years. You just went public, so a lot of people put in a lot of hours to get this company to the point of going public, right?
Chuck Smith
Sure, but to be clear on the compensation, the number is a component of that, and this is the crazy thing, unfortunately, I guess, about being a public company. When we issue stock options to our employees, we actually have to capture the expense of those options. It doesn’t mean that the employees are out now driving Ferraris because they’re locked up for a three-year vesting schedule, but the company has to actually book that loss associated with those options that we gave. So, that’s really a non-cash expense, but it’s expense nonetheless that we’re going to do because we want to incent our employees through options to make them part of the company and owners and rowing the boat in the same direction that we all are towards success.
Green Market Report
I think that’s great that you’re able to explain that because for a lot of people, they see that, and they see that net loss number, and it’s frightening, but when you explain it like that, it’s like, “Oh, okay. All right,” so everybody’s getting like you said, an investment within the company, which creates a lot of stickiness with your employees.
Chuck Smith
We want the employees to share in the upside of the great growth this company is going to have and the great success. It’s been nine long years, and this hasn’t been an industry that’s easy for anyone. So, now that we’re in the public eye and have access to capital markets, I expect a great growth for the company and ultimately, a great success. Like any company that’s building, you’re going to have to make investments. Those investments sometimes drop to the bottom line as losses, but the reality is every investment we make now in infrastructure or people or our routes to market are all designed to generate revenue. We’re not spending a lot of time having to do things just to catch up to others in the market. I think our portfolio is broader and more established than anybody else in the industry.
Green Market Report
Beverages. It seems like everyone’s slapping CBD oil in their beverage, and that now, they’re a CBD drink. What are your thoughts on that?
Chuck Smith
We’ve been in the CBD business for three years ourselves. However, our focus has been on dietary supplement formatted products both for humans, Aceso Hemp, and in that case, we have a couple of different types of product formats including an effervescent powder, which is kind of like an Emergen-C if you’ve ever had one of those.
Green Market Report
Love Emergen-C.
Chuck Smith
It’s a great product, indication-specific, high efficacy. On the other side, we have a great company that we own called Therabis, which targets CBD wellness to pets, primarily dogs, and we just introduced our cat treat. We’re very comfortable with these products because we’ve built them, Debra, against FDA supplement standards. Even though the FDA, as of today, doesn’t allow CBD in food and hasn’t made a ruling on supplements, we’ve built them from day one against that stringent level of standards. Now, we don’t have a CBD water yet, and frankly, the FDA is not giving us much comfort that they’re going to allow mass-market distribution of CBD in water and food, and I think that’s yet to come. As we get more guidance and clarity on that, you could expect Dixie to be at the forefront of that.
Green Market Report
So you’ve gotten Oklahoma. Is your goal more state expansion?
Chuck Smith
Yes, so we had said at the beginning of the year that we were going to open up between four and six new states that would be adding to the four states that we already have. So, our goal is really in between eight and 10 new states. Oklahoma is our sixth. We expect to be releasing product there by September, so that’s a pretty fast turnaround. In Michigan, we announced that deal at the beginning of February and had the product on the shelf the end of March, so we know what we’re doing, we know how to get the product into the market. With Oklahoma as our sixth state, you could expect to see one or two more announcements here probably over the next 30 to 60 days. That’ll really bring us into that eighth state and growing territory.
Green Market Report
Fantastic. We will keep an eye on Dixie and Therabis for our good pets.
William SumnerJune 13, 2019
Although adult-use cannabis is legal in nine U.S. states, problems persist with companies trying to gain access to capital and essential financial services. Consequently, the industry has devised a series of methods and institutions to circumvent these difficulties; from credit unions to keeping their funds in a giant safe. Another unique way that the cannabis industry has adapted to the issue has been connecting companies with private capital investment through investor forums. A perfect example of this is the MJMicro Conference planned for June 25, 2019, in New York City.
MJMicro is an invitational investor forum aimed at connecting high net worth investors with C-level executives of cannabis companies that have proof of concept, revenue streams, audited financials, and valuations justified by public markets.
The conference is hosted by MjLink.com Inc., a wholly-owned subsidiary of Social Life Networks, Inc. (OTC: WDLF). George Jage is President of MjLink.com, which is an A.I. and Blockchain powered cannabis social network technology company that launched one of the first cannabis social network platforms in the United States and Canada, back in early 2013.
In addition to a fireside chat with two of the leading cannabis companies in the industry, Canopy Growth (NYSE: CGC) and Acreage Holdings (OTCMKTS: ACRGF), several companies have been selected to host spotlight presentations during the conference. Those companies include Emerald Health Therapeutics (CVE: EMH), FSD Pharma (OTCMKTS: FSDDF), and Helix TCS (OTCMKTS: HLIX).
Emerald Health Therapeutics is a medical cannabis company licensed to operate in Canada. The company’s subsidiary, Emerald, both produces and sells medical cannabis and has a stake in a company that produces, cultivates and distributes wholesale cannabis and cannabis extracts for both adult-use and medicinal purposes.
Most recently, Emerald Health was appointed by the American Trade Association for Cannabis and Hemp (ATACH) to lead its International Affairs Council on CBD and Hemp in ATACH’s engagement with the US Food & Drug Administration’s public hearing on CBD regulations.
Acting as a subsidiary of FV Pharma Inc., FSD Pharma focuses on developing high quality indoor-grown medical cannabis and the development of novel cannabinoid-based treatments for several central nervous system disorders. The company is currently engaged in expanding its 25,000 square foot cultivation facility in Ontario.
Helix TCS provides infrastructure services for the cannabis industry. Though the company may not be a household name, several of its subsidiaries are more recognizable; including Helix Security, Cannabase, and the seed-to-sale tracking software company BioTrackTHC. Tracking over $18 billion in legal cannabis sales, Helix TCS’s products are used in six countries, 36 U.S. states, and over 2,000 licensed retail locations.
In addition to the spotlight presentations by Emerald Health, FSD Pharma, and Helix TCS; several notable cannabis companies are also set to present at MJMicro. Those companies include MJ Freeway, Dixie Brands., Vireo Health, and more.
Jage was the lead executive and driving force behind the development of Marijuana Business Daily and the success of MJBizCon from 2014 through 2017 and most recently he took the helm at Dope Media and successfully negotiated the acquisition by the High Times Holding Corp. His events have been recognized by Tradeshow Week (2006, 2008, 2009) and Tradeshow Executive (2016, 2017) as one of the fastest growing events in the U.S. He has been awarded UNLV’s Jerry Valen Award of Distinction (2010) and the Nevada Entrepreneur Award (2008), and named as the Trade Show Elite (2013) and Gourmet News’s Top 20 Under 40 (2006).
Green Market Report is a media partner of this event.
William SumnerMay 1, 2019It’s time for your Daily Hit of cannabis financial news for May 1, 2019.
On The Site
Curaleaf
Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) is going to acquire Cura Partners, Inc. the owners of the Oregon-based Select brand, in an all-stock deal valued at C$1.27 billion or $948.8 million. The company said that the acquisition includes Select’s manufacturing, processing, distribution, marketing, and retailing operations and all adult-use cannabis products marketed under the Select brand name, including all intellectual property. The deal is expected to close in 2019.
Emerald Health
Emerald Health Therapeutics, Inc. (TSXV: EMH) (OTCQX: EMHTF) delivered fourth quarter and 2018 results along with an update of its first-quarter sales. The revenue in the fourth quarter was $1.1 million versus last year’s $279 thousand for the same time period. The net loss in the fourth quarter was $13.9 million, higher than the third quarter’s losses of $6.4 million.
WeedMD
The licensed cannabis producer and distributor WeedMD Inc. (TSX-V: WMD) (OTCQX: WDDMF) announced its financial results for the fiscal year ending on December 31, 2018. WeedMD’s revenue for the full year grew from $1.4 million to $8.2 million, representing an increase of 456%. The company’s net and comprehensive loss declined dramatically, falling from $8.8 million to just $895,128.
In Other News
Golden Leaf
Golden Leaf Holdings Ltd. (CSE: GLH) (OTCQB: GLDFF) has reported its financial results for the 2018 fiscal year. Full-year revenue was $16.5 million, up 43% from $11.5 million in 2017. Gross profit declined slightly from 15% of total revenue ($1.7 million) to 13.3% of revenue ($2.2 million). The company’s comprehensive loss declined significantly, falling from $55.9 million in 2017 to $4.4 million, and its net loss was $4.6 million. “Looking forward, we remain focused on growing revenue by expanding our retail footprint, product array and cultivation presence throughout the U.S. and Canada. At the same time, we are committed to growing responsibly while improving our margin growth and EBITDA. Towards that end, we have taken several measures this year to increase efficiencies throughout our organization to lower costs, increase cash flow and improve our overall financial performance,” said Golden Leaf CEO William Kulczycki.
Dixie Brands
Today, Dixie Brands Inc. (CSE: DIXI.U) (OTC: DXBRF) (Frankfurt: 0QV) announced their financial results for the fiscal year ending on December 31, 2018. Revenue for the year was $5.7 million, up 73% from $3.3 million in the previous year. Fourth quarter revenue was $1.5 million. The gross profit margin was 52% ($3.01 million), up from 47% ($1.5 million) in 2017. Net losses rose significantly, climbing from $4.3 million in the previous year to $21.23 million. Company management attributes the steep climb to “significant increase in operating and other expenses,” such as its reverse takeover of Academy Explorations Limited and public listing activities. “The financing and public listing we completed in the final weeks of 2018 set the stage for a breakout year in 2019,” said Chuck Smith, President and CEO, Dixie Brands. “Dixie accomplished a lot as a private company, building up an industry-leading portfolio of more than 100 commercialized products. We are very excited by our opportunities to invest our capital into strengthening our distribution network and market presence to accelerate our growth.”
Weekend Unlimited
Weekend Unlimited Inc. (CSE: POT) (FSE: 0OS1) (OTCQB: WKULF) today announced the appointment of Chris Backus as Interim President and CEO, effective immediately. Backus was appointed to the company’s Board in March of this year and previously served as a former Senior Officer and Manager with the Royal Canadian Mounted Police (RCMP). Backus will focus on the launch of the company’s wknd! brand product line, generating revenues with CHAMP and Verve beverages in the USA, and the ramp-up of the Northern Lights Organics hemp farm in Canada. “’I am energized to accept this leadership role with Weekend Unlimited. Working with the Board and the team, my focus is entirely toward harnessing the Company’s assets to deliver results for shareholders,”’ said. Backus. “This means an immediate mandate to execute on ready-to-go initiatives that will drive revenues while building strong consumer awareness of the Company’s brands. Simultaneously, we will responsibly advance our initiatives supporting growth in the longer term.”
Debra BorchardtDecember 10, 2018Dixie Brands Inc. (CSE: DIXI.U) announced its financial results for the three-month and year-to-date periods ending September 30, 2018. Revenue was $2,435,000 in the third quarter of 2018, an increase of 110% over last year’s $1,162,000 for the same time period. However, Dixie delivered a net loss of $2,404,000 for the quarter versus $630,000 for the third quarter of 2017.
Dixie completed a reverse takeover in order to go public during the third quarter and this set back the company’s ability to record net income. Year-to-date, the company suffered a net loss of $4,696,000 in 2018. Dixie said that the 2018 results were affected by a non-cash charge of $2,187,000, which was recorded in Q3 2018, for the conversion of debt into equity, and by expenses of $803,000 associated with the reverse takeover, Series C financing and public stock listing completed subsequent to September 30. Without these charges, Dixie said it would have made a small profit in the quarter.
“Our revenue growth is accelerating as we realize an increasing return on years of investment in our product portfolio, manufacturing capabilities and distribution network,” said Chuck Smith, President, and CEO, Dixie Brands. “Our fully-funded business plan targets expansion into four-to-six new U.S. states and Canada in 2019, applying the successful template we have used in the four states where we already operate.”
The company reported that year-to-date, revenue was $4,205,000, up 60% from $2,630,000 in the first nine months of 2017. That growth was achieved by increased sales of Dixie’s THC-infused products in Colorado, Maryland, and Nevada, as well as the company’s CBD products. Dixie had $18,584,000 of cash on September 30, 2018. The company also noted that it had gross profits of $1,038,000 in the third quarter which was up 102% from $514,000 a year earlier.
During The Quarter
Dixie re-launched operations in California following a clarification of regulatory requirements in the state. Dixie said it expects to begin generating revenue in California in the fourth quarter of 2018. The company also entered into an agreement with Central Garden & Pet to distribute its Therabis line of pet wellness products. New products launched during the third quarter included Sour Smash Gummies and Cucumber-Melon Mints, and Mindset, a new brand focused on high quality vape and concentrate products.
Fourth Quarter
Dixie closed on a Series C financing round on October 1, 2018, raising gross proceeds of $25 million in an oversubscribed, non-brokered private placement. The company completed a reverse takeover of Academy Explorations Limited on November 27 and began trading on the Canadian Securities Exchange on November 2.
Video StaffOctober 5, 2018MedMen had a busy week. The company acquired a Scottsdale Arizona cannabis company Monarch including the dispensary and cultivation operation. It comes with all the licenses and some exclusive brand agreements. MedMen also acquired Chicago-based dispensary Seven Point this week and announced that it closed on a $73 million loan facility, which immediately got bumped up another five million.
Dixie Brands is the latest to declare a reverse take over to go public in Canada. The cannabis beverage company will take over Academy Explorations. The company also completed $25 million fundraising round.
Innovative Industrial Properties (IIPR) began a public offering of 2.6 million shares. It is priced at $40.00 per share for gross proceeds of $104 million. intends to use the net proceeds from this offering to invest in specialized industrial real estate assets that support the regulated cannabis cultivation and processing industry.
GW Pharmaceuticals (GWPH) said it planned on selling $300 million of ADS’s with a possible overallotment of $45 million. GW will issue 1,900,000 American Depositary Shares, representing 22,800,000 ordinary shares of GW, at a price to the public of $158.00 per ADS on the Nasdaq Global Market, raising gross proceeds of approximately $300 million (before deducting underwriting discounts, commissions and offering expenses). GW has granted the underwriters a 30-day option to purchase up to an additional 285,000 ADSs at the public offering price less underwriting discounts and commissions. It is expected to close on or about October 5, 2018.
Cannex Capital Holdings (CNXXF) reported that its revenues increased 223% to $3.4 million in its fiscal first quarter. Net income was $2.4 million versus a loss last year of $403 thousand for the ame time period. Revenue was generated primarily by way of packaging sales and rental income. Income for the period was $2,428,507 for Q1 2019, $.01 per share, as compared to a loss of $403,027 for the comparative period.
Aleafia Health (ALEAF) applied to list on the NASDAQ. The company currently trades in Canada on the OTC markets.
Hollyweed North Cannabis acquired Women Grow for an undisclosed amount.
Cynthia SalarizadehDecember 15, 2017Dixie Brands, one of the earliest big brands in cannabis is losing its chief executive officer. Co-founder Tripp Keber is resigning in order to take a new position that partners Dixie with Rose Capital based in Miami, Florida.
The fund plans on expanding in 2018 and will assemble a portfolio of infused product companies. Keber told Marijuana Business Daily “Today, effective close of business, I will step down as chief executive and president,” “I will turn over the reins to my very capable and competent business partner, Chuck Smith.”
Keber will take a leadership role at BR Brands, which will be a new Rose Capital affiliate. In this new arrangement, Dixie Brands will receive the resources that it needs to advance and be a part of the new BR Brands portfolio of infused product companies. Rose Capital claimed it will be providing “ongoing growth capital, strategic advisory and operational partnership.”
Keber will remain a majority shareholder in Dixie as well as remain the sole license holder for Dixie products and permits in Colorado.
It’s been a pretty dramatic week for Keber, who also resigned from the board at MassRoots this week as that company’s founder Isaac Dietrich reclaimed his company. As part of Dietrich’s move to get his CEO position back, he asked for the resignation of the board that ousted him and that included Keber.
Dixie’s History
Keber founded Dixie Holdings With Smith in 2010 in Colorado in the early stages of cannabis legalization with a THC-infused soda. A product that continues to be a consumer favorite In 2014, Dixie Brands was formed in order to manage the licenses and intellectual property of Dixie Elixirs & Edibles and establishing the manufacturing and distribution relationships for those products. Dixie products are now available for sale in four different states with plans for more expansion in 2018.
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