Flora Growth Archives - Green Market Report

StaffMay 10, 2022
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Flora Growth Corp. (NASDAQ: FLGC)  reported its financial results for the fiscal year ended December 31, 2021 with total revenue of approximately $9.0 million. The net loss for the year was $21 million, which increased over the previous year’s net loss of $14 million. Revenue for the period was significantly higher when compared to the prior year, primarily reflecting that 2021 was Flora’s first full year as a revenue-generating company, which included the company’s initial public offering on the Nasdaq Capital Market in May 2021.

Flora Growth reiterated its guidance of $35 million to -$45 million in 2022, which would realize projected revenue growth of 288% – 400% year over year. The company said it would begin distributing globally high-THC and high-CBD flower in the third quarter of 2022.

“Fiscal year 2021 was a foundational year for our company as we closed our first full year of revenues. In 2022 we anticipate accelerating revenue growth as we activate our Wholesale and Life Sciences growth pillars, while fueling expansion in our global House of Brands,” said Luis Merchan, Chairman and CEO of Flora. “We are proud of the milestones we achieved in 2021, including the completion of key strategic infrastructure projects, the strengthening of our balance sheet and the deployment of our M&A strategy. In 2022, we continue to execute on our plan, highlighted by the acquisition of JustCBD, a leading consumer wellness brand. This acquisition increased Flora’s footprint to over half a million consumers and 14,000 retail stores in the United States. The transaction is already proving accretive as Flora’s unaudited revenues for April represent our strongest revenue month since inception.”

Merchan added, “The completion of our cultivation and extraction facilities has positioned Flora for success in this rapidly evolving industry, as we satisfied the requirements for the cultivation, transformation and export of up to 43.6 tonnes of THC cannabis flower. And in our Life Sciences pillar, we look forward to potential commercial distribution of pharmaceutical-grade products based on the research of Dr. Annabelle Manalo-Morgan.”


Debra BorchardtFebruary 28, 2022
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4min1740

Flora Growth Corp. (NASDAQ: FLGC) has purchased  Just Brands LLC and High Roller Private Label LLC for cash consideration of $16 million and 9.5 million privately issued Flora common shares. Just Brands and High Roller are the owners of the JustCBD brand and associated operations. JustCBD generated audited revenues of $28 million and EBITDA of $7 million in the fiscal year 2020 across multiple categories, including gummies, tinctures, vape cartridges, creams, pet wellness, among others, all of which we believe to have meaningful long-term growth potential.  Flora said it expects JustCBD’s financial performance to immediately contribute to Flora’s 2022 revenues and earnings. The stock was popping by 11% to lately sell at $2.03. 

“We are thrilled to announce this news today and welcome the JustCBD team to Flora. To build such a recognizable brand in this noisy, rapid-growth market is a testament to everyone at JustCBD,” said Luis Merchan, CEO of Flora. “This acquisition continues to strengthen Flora’s foothold in the U.S. wellness market as well as providing meaningful growth acceleration and delivering human capital to the Flora organization. Additionally, there is incredible opportunity to leverage our economically-advantaged cultivation to support the expansion of the JustCBD brand in the global market.”

The company noted in a statement that JustCBD is an established CPG brand with a portfolio of over 300 products and a seamless omnichannel approach that includes a direct-to-consumer business with over 300,000 customers and a network of over 14,000 stores across the United States and internationally. The acquisition should enhance Flora’s infrastructure in the United States with JustCBD’s widespread distribution across mainstream U.S. channels and its production facility in Fort Lauderdale, Florida.

“Our team is incredibly excited to join Flora and rapidly expand JustCBD’s presence in new markets with new growth capital and an established international presence,” said Hussein Rakine, CEO of JustCBD. “Since the beginning, we have worked hard to build JustCBD into a prominent wellness brand in a hyper-growth space by delivering consistent experiences that have resulted in our loyal customer base.  By combining our product portfolio with Flora’s, we believe we have an industry leading wellness offering that will thrill our existing customers and attract new ones as we reach new markets.”

Flora intends to leverage synergies between its existing brand portfolio, including Vessel, Tonino Lamborghini, and Mind Naturals, with JustCBD’s extensive U.S. distribution network to further amplify revenue growth for these brands. To date, the majority of JustCBD’s sales have been derived from the U.S. wellness market, where it has developed into a prominent and highly sought-after brand. With the support of Flora’s strong balance sheet, we believe JustCBD is now positioned to expand into international markets where CBD products are permissible, including Germany, Mexico, and Colombia. JustCBD’s database of over 300,000 customers increases Flora’s existing customer base to over 500,000 customers.


StaffNovember 29, 2021
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Flora Growth Corp. (NASDAQ: FLGC) has signed a licensing agreement with Tonino Lamborghini to produce and distribute Tonino Lamborghini branded CBD (cannabidiol) beverages across North America and Colombia under the company’s renowned luxury lifestyle brand. Mr. Tonino Lamborghini has been taking inspiration from his family heritage and his vast experience in mechanics and engineering to develop his homonymous lifestyle experience brand dedicated to luxury design products and real estate projects.

The company said in a statement that the Tonino Lamborghini product line will be produced through Flora’s division and contain CBD and other premium cannabinoids such as cannabigerol (CBG). Under the licensing deal, Flora will retain the right of first refusal to produce and distribute any CBD or CBG products globally under the Tonino Lamborghini brand. The products will be produced in Florida initially for sale in US states where CBD ingestible are legal. Flora will be responsible for production and distribution and will target both ecommerce and brick-and-mortar channels.

“We are excited to partner with such a well-known luxury brand as Tonino Lamborghini, which already boasts a very successful line of beverages and aligns with Flora’s brand portfolio of high-end products,” said Luis Merchan, CEO of Flora. “This partnership is yet another step in the execution of Flora’s strategic plan to build a world-class house of brands and is also a major component of our sales and distribution strategy in the lucrative US market.”

The Tonino Lamborghini product line will be produced using Applied DNA Sciences, Inc. (NASDAQ: APDN) molecular tagging and authentication technology to ensure product verification, in line with the new age of cannabis consumer packaged goods (CPG). Flora will leverage this technology to ensure that the company’s products are derived distinctly from Flora’s operations, which will substantially reduce concerns of any illicit market or counterfeit products across North America or Colombia.

“Together with Flora we aim at creating new and innovative products and experiences for the modern consumer’s wellbeing,” said Ferruccio Lamborghini, CEO and VP of the Italian company. “Our branded beverages are studied to help people to achieve a sense of calm and coolness in both stressful times and ordinary daily routine. I am especially enthusiastic about the molecular tagging and authentication technology Flora will use to track with full transparency the top-notch ingredients origin.”

 


StaffNovember 19, 2021
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Flora Growth Corp. (NASDAQ: FLGC) priced its underwritten public offering of 10,000,000 units that are intended to raise $30 million. The company had recently announced its plans to buy the premium accessory company Vessel for $30 million. Each Unit consists of one common share and one-half warrant, each whole Unit Warrant entitling the holder thereof to purchase one Common Share. The Units are being sold at a public offering price of $3.00 per Unit. The Unit Warrants will have an exercise price of $3.75 per share, will be immediately exercisable and will expire five years from the date of issuance. The offering is expected to close on November 23, 2021, subject to customary closing conditions.

Vessel is known for its unique lineup of high-end dry-herb accessories and vape pen batteries and bespoke product programs for brands. Flora said these high-margin products, along with its development pipeline, are expected to drive incremental revenue and market share growth in new and existing categories. Vessel will receive $8 million in cash and the rest in Flora stock. Flora has also noted that Vessel has established relationships with U.S. multi-state operators and Canadian LPs who seek access to Vessel’s premium technology offering through their white labeling business. Headquartered in Carlsbad, California, Vessel will serve as a key component of Flora’s North American cannabis strategy across its entire product portfolio.

A.G.P./Alliance Global Partners is the sole book-running manager for the public offering and BMO Capital Markets and Roth Capital Partners are acting as co-managers. MKM Partners is acting as a financial advisor to the Company. Flora has granted the underwriters a 45-day option to purchase up to 15% of the total number of Units to be offered by us pursuant to this offering (excluding Units subject to this option), solely for the purpose of covering over-allotments, if any, at the public offering price less the underwriting discount.


StaffNovember 3, 2021
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4min1140

Flora Growth Corp. (NASDAQ: FLGC) is buying Vessel Brand Inc. in a deal valued at $30 million. Vessel is known for its unique lineup of high-end dry-herb accessories and vape pen batteries and bespoke product programs for brands. Flora said these high-margin products, along with its development pipeline, are expected to drive incremental revenue and market share growth in new and existing categories.

“The Flora team has been working diligently to execute on our various business initiatives and the signing of this agreement represents another significant step forward for the Company in 2021,” commented Luis Merchan, President and CEO of Flora Growth. “We are incredibly excited to have reached an agreement to add Vessel to the Flora portfolio. Not only does Vessel have an exceptional product line with strong revenue growth, but its leadership team is second to none. Integration plans with the Vessel team are already well advanced and we expect step-change improvements to the marketing and sales strategies for our core consumer brands like Stardog and Mind Naturals, as well as new brand development in support of our global growth initiatives.”

Vessel will receive $8 million in cash and the rest in Flora stock. Flora has also noted that Vessel has established relationships with U.S. multi-state operators and Canadian LP’s who seek access to Vessel’s premium technology offering through their white labeling business. Headquartered in Carlsbad, California, Vessel will serve as a key component of Flora’s North American cannabis strategy across its entire product portfolio.

“As Vessel, and as brand builders in nearly every sector, our promise has been to create unparalleled experiences – we are looking forward to continuing to deliver on that promise with Flora,” said James Choe, Founder and CEO of Vessel. “Flora is positioned to be a global leader in plant-based health and wellness by redefining the traditional narrative of a cannabis company. With unrivaled economies in the supply chain, a diverse brand portfolio roadmap, and most importantly a team built to meet the challenges of the industry, we see significant opportunities ahead.”

Exports Looking Up

Recently, Flora said that it received the Good Agricultural and Collection Practices (“GACP”) certification by the Control Union Medical Cannabis Standard (“CUMCS”). Paired with the recent Colombian law change, Flora may now export its high-quality dry flower to international GMP active pharmaceutical ingredient  producers or to markets where flower can be imported.

“In advance of this milestone, our team has signed several LOI’s for the sale and distribution of dry flower and derivative products to several international jurisdictions, including the EU, Australia, and Latin America. We are now in the position to unlock the significant potential from Cosechemos as we continue building our global distribution network,” said Jason Warnock, Chief Revenue Officer of Flora Growth. “Our team believes this certification demonstrates our ability to offer high-quality output, while also serving as an important precursor to GMP certification so that we can produce pharmaceutical-grade cannabis products and cannabinoid-based active pharmaceutical ingredients.”


Debra BorchardtSeptember 9, 2021
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Flora Growth Corp. (NASDAQ: FLGC) has entered into a commercial agreement with American e-commerce company Zulily to launch a sales and marketing campaign across the US for its Stardog Loungewear product line. The Flora brand and product launch through Zulily will initially feature Stardog’s best-selling product, hemp shoes, and is expected to kick off within the next month.

Zulily is a huge online retailer with annual sales of more than $1.5 billion and 5 million active customers. Zulily launches thousands of products each day, curating personalized shopping experiences. Zulily’s app uses compelling video and imagery to bring more than 15,000 big name brands and boutique finds to life on mobile, including brands such as Callaway, Cuisinart, Disney, Hanes, New Balance, SOREL, UGG, and Under Armour.

“In speaking with the category management team from Zulily, it was clear that they were looking to onboard special products with compelling values at attractive price points, differentiated by stories that inspire and excite consumers – this aptly describes Stardog and how we’ve executed mindfully building and scaling the brand, ” said Nicolás Vásquez, General Manager of Stardog Loungewear. “At Stardog, we are reframing our connection with nature by working with materials that can easily go back to where they came from. Growing the finest quality organic hemp fibers allows us to equip our tailors with the very best materials to design and handcraft our loungewear for consumers. Stardog is a shining example of the slow fashion movement that considers all aspects of the supply chain, aiming to respect people, the environment, and animals.”

Flora is a cannabis company that leverages natural, cost-effective cultivation practices to supply cannabis derivatives to its diverse business divisions of cosmetics, hemp textiles, and food and beverage. As the operator of one of the largest outdoor cultivation facilities, Flora strives to market a higher-quality premium product at below-market prices.

“Conversations around corporate social responsibility and having a transparent supply chain are more prevalent today than ever before as consumers carefully consider how to spend their hard-earned dollars. When reviewing potential distribution partners to launch this campaign, it was evident to us that Zulily was able to effectively take consumers on a digital discovery journey that could accurately capture the story we’re trying to tell, make a personal connection, and provide us with the opportunity to expand this campaign into a larger initiative across our entire brand and product portfolio,” said Jason Warnock, Chief Revenue Officer of Flora Growth. “Stardog has an extremely passionate and engaged community in Colombia and we’re looking forward to working with the team at Zulily to help create the same demand and engagement we see at home. By taking a customer-centric approach and implementing a comprehensive marketing strategy coordinated across the entire customer journey, we believe that we’re effectively positioning Stardog to be as leading global hemp textile brand and look forward to announcing further distribution deals.”


Debra BorchardtJuly 26, 2021
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Colombian President Ivan Duque Marquez has signed a new law that would allow a much larger amount of dry flower to be exported from the country, after a high-profile meeting of Colombian cannabis business leaders with US-listed public companies. The new law, a change to Colombian Decree 613, greatly increases the amount of dry cannabis flower (the flower, stems, and roots) that can be exported from the country, and also allows for cannabis to be put into industrial products like food and beverages and for much more extensive marketing of cannabis products in Colombia.

“The passage of this legislation greatly immediately accelerates our strategic vision of bringing our cannabis products to international markets as noted by our first international supply agreement out of Cosechemos while we focus expanding our global distribution platform of traditional consumer packaged goods. Now having the ability to export our high-margin, high-quality cannabis flower being produced at Cosechemos, together with a healthy portfolio of premium brands, and a robust pipeline of deals, we will continue to look towards international markets to drive growth and revenue generation,” said Jason Warnock, Chief Revenue Officer of Flora (NASDAQ: FLGC). “Another added benefit of the new regulations is that we can now process the entire plant whereas before Colombian processors had to destroy upwards of 60% of the biomass which we anticipate will further improve on our margins out of Cosechemos.”

Columbia Decree

Some of the new language is as follows:

  • To encourage the pharmaceutical industry, Colombia will allow the entry of dried flower, seeds, grain, plants, plant components, and derivatives to free zones, so that companies can carry out processing, packaging, and repackaging activities at lower prices, taking into account the tax benefits of these zones.
  • Licenses have been extended from five years to 10 years.
  • The advertising prohibition has been lifted.
  • The activities that can be developed in the food market are specified, under the strict standards of Invima and other competent entities. This economic sector is yielding great returns worldwide and the economy of our country needs that boost.
  • The prohibition on the export of dried cannabis flower is eliminated, so that in the subsequent regulation a scientific debate is made to identify under what requirements and for what purposes this activity should be carried out, always having as its north the medical and scientific purposes.
  • The dispensing of master preparations based on cannabis in drugstores is allowed, which will facilitate the access of these medicines to the patient since these establishments are the most numerous and closest way to reach the patient.

Flora Growth Ready For Expansion

 Flora Growth said these new regulations will allow for the opportunity to increase near-term revenue and optimize its global diversified supply chain of premium brands and products. The company said that through this legislative update, Colombian cultivators like Flora Growth, have immediately gained access to this massive segment of the market that was previously inaccessible. “The allowance of cannabinoid containing ingestible products creates a near-term opportunity to amplify revenue growth through its food and beverage division, Kasa Wholefoods. Kasa intends on leveraging existing relationships to distribute CBD versions of its portfolio, including the recently announced $10M distribution agreement with Tropi, Colombia’s largest food and beverage distributor with 130,000 points of distribution across the country.” Additionally, by removing marketing restrictions on cannabis products locally, Flora Growth will be able to drive increased awareness across its portfolio of products and driving additional sales through its 1,500+ points of distribution within Colombia. 

Khiron Applauds News

Alvaro Torres, CEO of Khiron Khiron Life Sciences Corp. (TSXV: KHRN)(OTCQX: KHRNF) said, “Colombia has been a regional leader in medical cannabis laws since 2015 and this new Decree strengthens the Government´s commitment to creating a robust and competitive industry. After naming the industry a National Strategic Priority and extending universal health coverage for THC and CBD medical cannabis products in late 2020, the new regulation expands the country’s growth potential across various product categories in Colombia and through the export of dried flower.” Since April 2020, Khiron has been dispensing medical cannabis to patients through its Zerenia pharmacy in Bogota, to more than 350 cities and municipalities across the country. With Decree 811 of 2021, the Government has significantly expanded the number of pharmacies eligible to carry and dispense medical cannabis products, from only a handful today to a network of more than 14,000 pharmacies nationwide.


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