ABcann Global Announces Financial Results and Provides Operational Update
November 29 2017 - 4:37PM
ABcann Global Corporation (TSXV:ABCN)
(“
ABcann” or the “
Company”) today
announces the release of its financial results for the three and
nine months ended September 30, 2017. Copies of the interim
filings, including the Management’s Discussion and Analysis for the
period, are available under the Company’s SEDAR profile at
www.sedar.com.
Highlights from Q3/17
- Cash position of over $43 million, which positions ABcann well
to fund its expansion plans.
- Revenues of $614K for the nine months ended September 30, 2017
as compared to $211K in the comparable prior year
period.
- Cancellation of 15 million dilutive warrants as a result of the
completion of the $15 million equity financing with Cannabis
Wheaton Income Corp. in July 2017 and the exercise of warrants for
aggregate proceeds of approximately $7.5 million.
Subsequent Events
- Strengthened leadership: announced the appointment of Barry
Fishman as Chief Executive Officer and as a director, Paul Lucas as
Independent Chair, and Rick Fitzgerald as an independent director,
and the proposed appointment of Michael Bumby as Chief Financial
Officer, which is to be effective as of December 1,
2017.
- Debentures in the aggregate principal amount of $5.3 million
were converted into common shares of the Company.
- Further to the Company’s news release of November 27, 2017,
entered into a binding interim agreement with respect to a proposed
private placement of convertible senior unsecured debentures in the
aggregate principal amount of $30 million, the completion of which
is subject to various conditions, including execution of definitive
agreements, the receipt of the approval of the TSX Venture
Exchange, and the conversion of existing secured convertible
debentures of the Company in the principal amount of $15
million.
Financial Results
For the quarter ended September 30, 2017, ABcann
reported revenues of $177K, and a net loss of $3.7 million as the
Company continued to invest to drive future growth. As at September
30, 2017, the Company had $43.4 million in cash, cash equivalents
and marketable securities, and 126.1 million common shares
outstanding, and there are approximately 135.7 million shares
outstanding as at the date hereof.
Business Priorities
ABcann CEO and director, Barry Fishman,
commented, “ABcann’s vision is to create a successful long-term
business that creates superior products for our customers, value
for our shareholders and a great workplace for our team. Our
management team is working diligently to establish a strategic plan
that will provide a roadmap for the Company’s long-term success in
the fast-growing global cannabis industry.”
ABcann is widely recognized as a producer of
premium cannabis – grown using proprietary advanced techniques
tailored to optimize quality and consistency. High-tech growing is
our differentiator. Our technology allows us to precisely control
environmental variables to facilitate the development of a diverse
line of products.
ABcann is focused on three main priorities: (i)
deploying an operating model that achieves competitive margins,
(ii) recruiting and retaining top talent to ensure flawless
execution of our business plan, and (iii) building a strong patient
base by providing a differentiated customer experience.
ABcann currently sells pharmaceutical-grade
cannabis from organic inputs that are 100% free of harmful
pesticides. Our future plans include a full line of dry flower,
oils, edibles, capsules and transdermal products.
Facility Update
ABcann is on track to complete the expansion of
our high-tech Vanluven facility to 30,000 square feet by mid-2018.
The Company is currently reviewing a variety of expansion
alternatives to find the most cost-effective way to build or
acquire over 15 tons of incremental capacity per year to expand our
medicinal business and address the recreational market in 2018. The
Company’s balance sheet currently has a cash position of over $43
million which will largely be allocated to fund our growth
plans.
Germany Update
Germany’s domestic cultivation program is
planned to be in place and producing cannabis by 2019. ABcann
participated in an application process related to domestic
cultivation licenses but did not qualify as a short-list candidate
due to having lower cannabis sales as compared to other applicants.
ABcann believes German authorities are likely to issue another
round of tenders early in 2018, and the Company is planning to
participate.
ABcann is also planning to obtain a
distribution/import license for Germany and is working towards
fulfilling the requirements of GMP certification of the Vanluven
facility and the completion of six-month stability testing in
connection therewith. The Company is not expecting to import
cannabis into Germany prior to mid-2018. Germany, which is expected
to be a stepping-stone to other European countries, as well
as Australia, continue to be strategic international markets
for ABcann.
About ABcann:
ABcann holds production and sales licenses from
Health Canada. Its flagship facility in Napanee, Ontario contains
proprietary plant-growing technology, centred on its
specially designed, environmentally-controlled growing chambers.
This approach results in the production of pharmaceutical-grade
cannabis products.
The Company is expanding its cultivation
capacity and pursuing partnership and product development
opportunities domestically, as well as in select international
markets, such as Germany, Australia and Israel.
ON BEHALF OF THE BOARD OF DIRECTORS
"Barry Fishman"
Barry Fishman CEO and Director
For further information, please contact Barry
Fishman at barry.fishman@abcannglobal.com or Aaron Keay at
aaron@abcannglobal.com.
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Disclaimer for Forward-Looking Information
Certain statements in this news release are
forward-looking statements, which are statements that are not
purely historical, including statements regarding the beliefs,
plans, expectations or intentions of ABcann and its management
regarding the future. Forward looking statements in this news
release include statements relating to: the expected timing for
appointment of Michael Bumby as Chief Financial Officer; ABcann’s
vision for the near and long-term growth and success of the
Company; ABcann’s ability to achieve competitive margins; ABcann’s
ability to recruit and retain top talent to ensure flawless
execution of its business plan; proposed new product lines such as
edibles, capsules and transdermal products; ABcann’s expected
timing for completion of its Vanluven facility expansion; ABcann’s
plans to build or acquire over 15 tons of capacity per year;
ABcann’s ability to expand its medicinal business and address the
recreational market in 2018; ABcann’s beliefs regarding the
expected timing for, and regulatory framework of, the German
domestic cultivation program; and ABcann’s future plans with
respect to cultivation, distribution and imports into Germany,
Australia and other international jurisdictions. Such statements
are subject to risks and uncertainties that may cause actual
results, performance or developments to differ materially from
those contained in the forward-looking statements, including: (i)
that ABcann may not be able to substantially increase its
production capacity at either its current Vanluven facility or
proposed Kimmett facility; (ii) that ABcann may not be able to
achieve competitive margins; (iii) that ABcann may not be able to
increase the sales of its products in the current domestic market
or to successfully launch new product lines; (iv) that ABcann may
not be able to obtain a distribution/import license or a
cultivation license for Germany or other emerging markets it is
targeting; (v) that ABcann may not be able to serve larger and
broader markets as a result of its production increase; (vi) that
ABcann may be unable to retain its key talent; (vii) that ABcann’s
management may be unsuccessful in developing and/or implementing a
new strategic plan that provides the Company with a road map for
future success; and (viii) other factors beyond the Company’s
control. No assurance can be given that any of the events
anticipated by the forward-looking statements will occur or, if
they do occur, what benefits the Company will obtain from them.
Readers are urged to consider these factors, and the more extensive
risk factors included in the Company’s filing statement dated March
31, 2017, which is available on SEDAR, carefully in evaluating the
forward-looking statements contained in this news release, and are
cautioned not to place undue reliance on such forward-looking
statements, which are qualified in their entirety by these
cautionary statements. The forward-looking statements in this news
release are made as of the date hereof and the Company disclaims
any intent or obligation to update publicly any such
forward-looking statements, whether as a result of new information,
future events or results or otherwise, except as required by
applicable securities laws.
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