Flower One Archives - Green Market Report

Debra BorchardtDebra BorchardtMay 4, 2020
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4min4590

While other cannabis companies have complained of a tight capital environment, Nevada-based Flower One Holdings Inc.  OTC:FLOOF has successfully closed its previously announced non-brokered private placement. The company said it raised C$10.9 million or $7.8 million. This is higher than the previously planned offering of $7.5 million. Flower One said it plans to use the proceeds for general corporate and working capital purposes.

“This Private Placement garnered strong demand from existing shareholders as well as new, strategic investors from multiple countries and signifies an expansion of our capital markets profile internationally,” said Ken Villazor, President and CEO of Flower One. “The high level of interest in our offering truly speaks to our differentiated market strategy and proven ability to execute and scale our operations to become a market leader in the U.S. cannabis industry.”

Flower One is the largest cannabis cultivator, producer, and full-service brand fulfillment partner in the state of Nevada. Flower One’s flagship 400,000 square-foot greenhouse and 55,000 square-foot production facility is used for large scale cannabis cultivation, processing, and manufacturing. Flower One also owns and operates a second production facility in Las Vegas, with 25,000 square feet of indoor cultivation and a commercial kitchen that will produce several of the nation’s top-performing edible brands.

Flower One produces a wide range of products ranging from wholesale flower, full-spectrum oils, and distillates to finished consumer packaged goods including flower, pre-rolls, concentrates, edibles, and topicals for the top-performing brands in cannabis.

Deal Terms

In connection with the Private Placement, Flower One issued a total of 29,599,025 units comprised of one common share in the capital of the company and one-half common share purchase warrant.

Preliminary Earnings

Last month, the company announced its preliminary unaudited first-quarter revenues with for 2020 of $8.9 million, near the mid-point of the company’s guidance range of $8 million to $10 million. March 2020 cannabis sales of $3.9 million, the company’s highest recorded monthly sales to date, and a sequential increase of 47% compared to February 2020.

The company still has not formally filed its 2019 and fourth-quarter 2019 earnings. Flower One said it expects to file the Annual Filings after market close on May 7, 2020. Flower One will also host a conference call on May 8, 2020, at 8:30 a.m. ET to discuss its financial results and review recent and upcoming milestones.

“Since our first sales of product out of our flagship greenhouse in the third quarter of 2019, Flower One has consistently delivered month-over-month growth,” said Ken Villazor, Flower One’s President and Chief Executive Officer. “We are pleased to see this sales momentum and are proud to be able to continue to support our brand and retail partners during these challenging times. Over the next two quarters, we expect to launch several leading cannabis brands and products into the market that we anticipate will be catalysts for further revenue growth for our Company, including product launches for The Clear, Old Pal, Heavy Hitters, and Cookies.”


StaffStaffNovember 27, 2019

4min7690

Flower One

Flower One Holdings Inc. (CSE: FONE) (OTCQX: FLOOF) reported that its third-quarter revenue was $2.5 million, with sequential quarterly growth of 292% and representing seven weeks of sales from the greenhouse. The company also reported that net income totaled $15.7 million,  which was mainly driven by the gain on the growth of biological assets of $18.4 million and a gain on the fair value of derivatives of $9.7 million.

“This was another milestone quarter for Flower One as, among other things, it was the first reporting period that included revenue contributions from our flagship greenhouse,” said President and Chief Executive Officer, Ken Villazor. “During the quarter, we completed and fully commissioned our 55,000 square foot production facility and welcomed three additional industry-leading brand partners to our growing portfolio. Our greenhouse and production facilities are now fully operational and yielding industry-leading analytics. This, combined with securing 15 brand partnerships, was accomplished within 19 months and places us in an exciting and truly unique path to profitability and positive cash flow in the first half of 2020.”

Flower One has made a big splash since its brand Old Pal became the leading flower brand in the state of Nevada within its first three months of sales. Old Pal and NLVO are among the top ten selling flower brands in Nevada.

Flower One said in a statement that it has now completed 15 harvests, which on average have produced a cultivation yield of 32 grams per square foot at an average harvested cash cost of $0.44 per gram. Flower One’s dry cannabis is now transitioned daily to its 55,000 square-foot production facility to generate a wide variety of the most in-demand cannabis products and brands from across the United States. The production facility currently consumes 3,000 to 5,000 pounds of biomass per week. In the last two months, the production lab has also begun producing an extensive product library of high-quality concentrates including shatter, batter, cookie crumble, wax/budder, THCA diamonds, THCA sugar and LPG high terpene sauces.  The company’s first lots of concentrates will enter the market this quarter.

Cannara Biotech

Cannara Biotech Inc.  (CSE: LOVE) (OTCQB: LOVFF) has not yet generated cannabis-related revenues from its Canadian operations and is still in progress of completing the construction of Phase 1 of the Farnham Facility which is required to obtain the License. Still, it has funded ShopCBD.com Inc. with an $8 million private placement to support the launch of the online e-commerce platform for the sale and distribution, in the US, of hemp-based CBD products. It has over $26 million of available cash. The company reported net loss of $3,810,875 for the year ended August 31, 2019

 


William SumnerWilliam SumnerSeptember 18, 2019
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4min6650

It’s time for your Daily Hit of cannabis financial news for September 18, 2019.

On the Site

Overcoming Canada’s Cannabis Shortage

Shortages of Canadian marijuana appeared immediately after recreational sales of cannabis starting from October 2018.  Hence, there is a typical Canadian refrain almost lately.  Because of little inventory remaining, many stores are closed three days a week, and provincial distributors are blaming federal regulations and producers. Some of the giant retailer’s licenses have also frozen and some are limited to 25 stores on the state level.

Supreme Cannabis

The Supreme Cannabis Company, Inc. (FIRE.TO) (SPRWF) reported net revenue of $19 million for the fourth quarter ending June 30, 2019, a 90% increase sequentially. The net loss for the quarter was $421,000. Supreme Cannabis’ core recreational flower brand, 7ACRES, accounted for the company’s marked increase in revenue, growing 443% year-over-year from $3.5 million in Q4 2018 to $19 million in Q4 2019.

In Other News

CannTrust

In a blow to the beleaguered company, CannTrust Holdings Inc. (TSX: TRST) (NYSE: CTST) announced that is has received a Notice of Licence Suspension under section 64(1) of the Cannabis Act, citing noncompliance. The notice is a partial suspension for the company’s license for cultivation and a full suspension of its license for standard processing, medical sales, cannabis drugs and research. CannTrust will still be able to cultivate and harvest existing lots or batches previously propagated, as well as the ancillary such as drying, trimming, and milling. Health Canada will reinstate CannTrust’s license if the reasons for the suspension no longer exist or if CannTrust demonstrates that the suspension was unfounded.

Flower One

Flower One Holdings Inc. (CSE: FONE) (OTCQX: FLOOF) has entered a sale-leaseback agreement with Treehouse Real Estate Investment Trust, Inc. for the company’s 25,000 square-foot indoor cultivation and production facility in North Las Vegas, including the adjacent vacant lot. The company is planning to build a commercial kitchen and manufacturing space on the property. Construction is expected to begin by the second quarter of 2020. Treehouse will purchase the property for $20 million. “Flower One is thrilled to form a long-term partnership with Treehouse, enabling us to access significant capital to continue our expansion in Nevada and potentially beyond,” said Kellen O’Keefe, Chief Strategy Officer at Flower One. “Flower One is actively pursuing multi-state opportunities and plans to utilize its partnership with Treehouse in order to do so.”


StaffStaffJanuary 29, 2019
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6min7980

It’s time for your Daily Hit of cannabis financial news for January 29, 2019.

On The Site

Sproutly

Sproutly Canada, Inc. (OTCQB: SRUTF)  announced financial results for the three and nine months ended November 30, 2018. The company reported a net loss of C$2.8 million or $0.02 per diluted share for the quarter versus last year’s net loss of C$473,405 for the same time period. The company also delivered a $9.5 million net loss for the nine months ending November 30.

In the filing, Sproutly noted that it has not generated any revenues from operations and has incurred losses since inception. The company has an accumulative deficit of $12,312,832 and negative cash flows from operating activities for the period from January 17, 2017 to November 30, 2018. To date, the company’s activities have been funded through financing activities.

New Mexico

The New Mexico Medical Cannabis Program racked up $106 million in sales in 2018 for a 23% increase over 2017. Patient enrollment grew by 45% from 2017 to 2018 and now counts 67,574 patients in the system. It’s easy to see an imbalance here. The patient count grew faster than sales.

The largest provider in the system Ultra Health said that the problem is plant count limits combined with regulatory hurdles. The company was the largest provider in the state with a market share of 15.4% in 2018 and reporting $16 million in revenue for the year.

In Other News

Valens GroWorks Corp. (OTC: VGWCF)  announced that it has entered into a multi-year extraction services agreement with Organigram Inc. (OTC: OGRMF) for cannabis and hemp extraction services. Valens will extract cannabis flowers and trim from Organigram’s Moncton operation as well as hemp to produce extract concentrate. In turn, the concentrate will be used by Organigram to produce oils and, eventually, derivative edible and vaporizable cannabis products. The legalization of cannabis edibles and other derivative based products in Canada is expected later this year. In addition, under the terms of the Agreement, Valens will also provide lab services for Organigram as needed.

Alternate Health Corp.(OTCQB: AHGIF) has done a non-brokered private placement of unsecured convertible notes under prospectus exemptions available under applicable securities legislation in the aggregate principal amount of up to C$12,000,000 ($9,000,000), maturing and payable on the date that is three years from the date of issuance. The private placement proceeds will assist in funding Alternate Health’s expansion into California’s adult-use cannabis industry, including key acquisitions. With licensed facilities in Los Angeles and Humboldt County, Alternate Health is actively marketing the Company’s software to leading players in the industry. In addition to funding expansion opportunities in product distribution and CBD marketing, private placement proceeds will be used in Alternate Health’s CanaPass business and for general working capital purposes.

Flower One Holdings Inc.  (OTCQB: FLOOF)  announced a new licensing agreement and Brand Partnership for cannabis-product fulfillment in Nevada. HUXTON is an Arizona-based lifestyle cannabis brand known for their curated, consistent, multi-strain blended products. Flower One is now licensed to manufacture, distribute and sell HUXTON’s signature cannabis products to all cannabis retailers in Nevada.



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