Open Letter to Stakeholders from Chief
Executive Officer, Charles
TORONTO, Jan. 18, 2021 /CNW/ - 48North Cannabis Corp.
(TSXV: NRTH) ("48North" or the "Company"), announced today that
Chief Executive Officer Charles
Vennat issued an open letter to stakeholders to provide a
corporate update of 48North.
To the stakeholders of 48North:
I write to provide you an update on our company's state of
affairs, corporate strategy, and path to future success.
While I am excited to update you all on the important progress
that 48North has made, I would be remiss if I did not first
acknowledge the difficult circumstances that we are collectively
facing as the COVID-19 pandemic continues to affect millions of
Canadians in different ways. I am grateful for our team's hard work
in response to the circumstances, particularly frontline staff at
our cultivation and manufacturing facilities.
While many Canadians will soon want to forget the year that was,
for 48North 2020 was a pivotal year where we shifted our attention
squarely on the consumer. In 2021 that focus will only continue to
To best understand where we are going as a company, it is
important to revisit the two fundamental commitments I made to our
stakeholders last year:
- That we would maintain focus on the company's founding vision,
that natural and high-quality products can create thought-provoking
experiences that nurture wellbeing.
- That we would make necessary operational improvements so that
our company could bring more products to the market and live up to
the high expectations of our consumers.
We have delivered on both commitments, launching 32 SKUs
nationwide since March 2020, centered
on the belief that beloved brands with strong products will
differentiate the winners and losers.
With confidence, I can now say that 48North is a brand-led and
consumer-obsessed Licensed Producer with an expansive portfolio of
high-quality, accessibly priced products.
While our peers with deeper pockets and larger teams splurged on
international expansion, medical markets, and patent hoarding – our
mission never changed – to build a best-in-class Canadian
recreational cannabis company. We remain steadfastly driven by this
In the legal recreational industry's earliest days, we saw a
feeding frenzy of investment activity, fueled by stock promotion
with limited interest in building meaningful brands or quality
products. For most Licensed Producers, consumers were
afterthoughts, and it is showing.
At 48North, our strategy flips this flawed way of thinking on
its head. We lead with brand and consumer insights. Our investments
in facilities, people, and products serve to bring our brand vision
to consumers across Canada, and it
When I took over as CEO, much of the operational foundation
still needed to be laid. To achieve this, we needed to add
experience and sharpen our focus. We have done exactly that.
We hired Michael Highdale, a
results-oriented CPG executive with broad senior experience in the
food and beverage industry as our Chief Operating Officer. Michael
has played a leading role professionalizing our operational and
We have added experience to our cultivation team and entered
this year's Good:Farm planting and harvesting seasons with valuable
insights from our ground-breaking year as one of Canada's first licensed outdoor cultivation
facilities in 2019. Further, we are proud to partner with Humble
Cannabis Services, a division of humble+fume, to support our
growing national sales objectives.
Effective immediately, the company is announcing the departure
of Chief Financial Officer, David
Hackett. On behalf of the entire 48North team and our Board
of Directors, I would like to thank David for his time at the
company. In his three years with the company, David helped us
navigate many of our largest business milestones – including taking
us public in 2018. We wish David all the best in his future
To that end, the company is also announcing the naming of
Donnacha Rahill as Interim CFO. Donnacha has over 20 years of
experience in various CFO and senior finance roles in Canada, Ireland and Singapore. Most recently, Donnacha served as
CFO for Flow Capital Corp. (TSXV: FW). He is a Fellow of the
Institute of Chartered Accountants in Ireland and was admitted to membership in
I am also pleased to announce we have officially begun a formal
search process for the Company's permanent CFO position.
Our leadership team is committed to the success of the company
and is well positioned to continue with our rapid growth.
48North's approach to product development is informed by an
understanding not only of where the industry is today, but where it
is going and where we want to position ourselves within it. We have
established ourselves as an early leader in innovative product
development, introducing Canada's
consumers to the first topical, Apothecanna. We continue to
be a market leader in the manufacturing and sale of topicals.
Delighting consumers is at the heart of our strategy, and we are
constantly leveraging data in order to refine our product offering,
and to deliver accessible quality across the country. For example,
we were pleased to see recent data from the Ontario Cannabis
Store suggesting that the majority of new consumers see
environmental and sustainable packing as an important attribute. We
have heard this message resoundingly from our own consumers, who
are ecstatic about our biodegradable packaging.
We are listening to consumers about gaps in the market so that
we can reach underserviced segments of the population. Under our
Latitude brand, for example, we have launched a range of
products from sexual wellness, to beauty, and beyond. Under this
banner, our intimacy oil is available in Ontario and Alberta.
Our investments into our operational capabilities allow us to
quickly launch new products to market while meeting growing
in-market demand for our branded products. In the coming year, we
expect to expand our offerings even further with live resin,
edibles, accessible vapes, a new topical line, and value-branded
We are now fully licensed to cultivate, extract, manufacture and
sell all cannabis, and this is a direct testament to the progress
we have made at our three facilities: delshen, Good:Farm, and
At delshen, we cultivate high-quality indoor craft cannabis.
Most notably, delshen is where we cultivate our Green Crush
and Where's My Bike strains that consistently test at over
20% THC with strong terpene content. At Good:Farm, we have proven
that outdoor cultivation works; when it comes to products such as
vapes and topicals, outdoor cannabis allows us to compete on price
and quality. And finally, at Good:House, we run an automated
state-of-the-art production facility critical to ensuring that our
supply chain can meet in-market demand for our products.
These investments into our operational infrastructure have
required significant patience and commitment but have allowed us to
lay a strong foundation to our commercialization strategy.
The industry has matured and the metrics that govern our success
have evolved. Capacity and cultivation yields continue to be
important for vertically integrated companies like 48North, but
revenue, market share, distribution, and consumer preference now
reign supreme in an industry that is rapidly starting to mature. By
these metrics, 48North is exceeding expectations.
To wit: we have recently ranked as the number one topical at
retail in Ontario, and three of
the top ten topical products in Canada. We have established early market
leadership with the number one concentrate in Ontario and Alberta and our dried flower and pre-rolls
frequently rank in the top ten for Ontario sales.
Our approach is reliant on a consumer-centric selection of
high-quality, affordable products, and building upon our excellent
relationships with wholesalers and retailers alike. In provinces
like Ontario, that are moving to a
"core assortment of products", we have solidified our existing
presence with a number of SKUs with retail penetration of over 50
In Alberta, we experienced a
1,454 per cent increase in sales, and a 560 per cent increase in
Ontario. We are thrilled to see
the steady monthly growth of the Canadian adult-use cannabis
market, led by strong store roll outs in Ontario and Quebec. Consumer response is encouraging, and
we are working hard to live up to expectations. We are bringing
flower to the people, one SKU at a time.
Not only are consumers intrigued by our new products, but we
continue to experience high rates of reorders. We are working hard
to ensure that 48North consumers of today will be with us tomorrow,
and that they will be joined by an ever-increasing number of
Canadians across the country.
In Q1 of Fiscal 2021, we decreased our cash use by nearly 20 per
cent from $8.55 million in Q4 to
$7.1 million. Following its build out
of the Good:House facility and the completion of the
state-of-the-art drying facility at the Good:Farm, the company does
not expect further significant capital expenditures in Fiscal 2021.
Building on the efficiencies stemming from our investments into
automation and process improvement, we also expect to continue to
lower operating costs and increase our gross margins. With
increasing revenues and decreasing spending, we are continuing to
meet our targets and expect to be in a position to announce our
path to profitability within the fiscal year.
We are a company that believes we can achieve strong results by
focusing on what we do best: delighting the consumer by focusing on
our brands, our products, and our people. As a brand-led and
consumer-obsessed Licensed Producer, I am proud of the progress we
continue to make.
I look forward to providing additional updates as we progress on
our steady climb towards profitability.
Charles Vennat, Chief Executive
48North Cannabis Corp. is a brand-led vertically integrated
Licensed Producer focused on manufacturing high-quality products,
nurturing progressive and thought-provoking brands, and low-cost
cultivation. 48North operates Good:Farm, a 100-acre organic
cannabis farm which produces organically-grown cannabis, securing a
significant first-mover advantage in the production of low-cost,
next-generation, extract-based cannabis products. In addition, the
Company operates two indoor-licensed cannabis production sites in
Ontario. 48North cultivates unique
genetics at its wholly owned subsidiary, DelShen Therapeutics Corp.
("DelShen") and processes cannabis and manufactures next-generation
cannabis products at Good & Green Corp. ("Good:House"). 48North
has an industry leading commercialization process, turning raw
biomass into high-quality finished product with distribution and
market share across the country.
48North has a growing portfolio of brands that includes:
48North, an innovative and high-quality cannabis brand focused on
sustainability; Latitude, a next-generation lifestyle cannabis
platform focused on sexual wellness, beauty and beyond; Trail Mix,
an accessibly-priced recreational cannabis brand that leverages
biomass from the Company's outdoor cannabis farm, and two-licensed
U.S. brands Avitas and Apothecanna. In addition, 48North operates
Good & Green Manufacturing Corp,. a state-of-the-art cannabis
processing, manufacturing, packaging, and distribution hub for the
Canadian cannabis industry. In operation since 2017, Good
& Green Manufacturing Corp. has successfully launched over 50
products – ranging from vapes, pre-rolls, hash, flower, solventless
extracts – in the recreational marketplace.
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Exchange) accepts responsibility for the adequacy or accuracy of
this release. Certain statements contained in this press release
constitute forward-looking information. These statements relate to
future events or future performance. The use of any of the words
"could," "intend," "expect," "believe," "will," "projected,"
"estimated" and similar expressions and statements relating to
matters that are not historical facts are intended to identify
forward-looking information and are based on the parties' current
beliefs or assumptions as to the outcome and timing of such future
events. Actual future results may differ materially. Please refer
to the Company's SEDAR filings for further details concerning the
risks associated with the Company's business. The forward-looking
information contained in this release is made as of the date hereof
and the parties are not obligated to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
applicable securities laws. Because of the risks, uncertainties and
assumptions contained herein, investors should not place undue
reliance on forward-looking information. The foregoing statements
expressly qualify any forward-looking information contained herein.
Public health crises, including the ongoing novel
coronavirus (COVID-19) pandemic, could have significant economic
and geopolitical impacts that may adversely affect the
Company's business, financial condition and/or results of
SOURCE 48North Cannabis Corp.