Cannabis Professional’s daily roundup of industry news. View archive here.
Just two items worth your time this Tuesday morning in marijuana: Valens GroWorks managing to nearly triple revenue in its latest quarter and Ontario’s first-ever legal cannabis festival is coming to Kitchener in early September.
– Jameson Berkow
Valens GroWorks beats Q2 earnings expectations
Kelowna, British Columbia-based cannabis extractor and processor Valens GroWorks brought in more revenue and generated more profits in its latest quarter than analysts were expecting.
The company reported financial results for the second quarter of its 2019 fiscal year on Monday after markets closed. Revenue came in at $8.8-million, eclipsing expectations of $6.7-million and despite analysts predicting a net loss, Valens reported gross profit of $5.1-million, representing a 58 per cent profit margin.
Last week, GMP Securities analyst Ryan Macdonell raised his Q2 revenue forecast for Valens to $7-million from $6.4-million previously. His increase was based on the company having started construction in June on a new facility connected to its Kelowna headquarters that, once complete in mid-2020, will boost its total extraction capacity to 425 tonnes per year.
“If Valens were to utilize the full 425 tonnes of capacity in [full year 2020], we estimate this could support $180m-$190-[million] of revenue from tolling, without including any white labeling services,” Mr. Macdonell told clients at the time. “Additionally, the expansion will increase Valens’ white labeling capacity to industrial scale for vaporizers, topicals, edibles, concentrates and capsules.”
Valens shares moved from the Canadian Securities Exchange (CSE) to the TSX Venture Exchange as of July 10th. The stock gained 3.1 per cent on Monday to close at $4.32 per share.
More details on the company’s Q2 results will likely come from an 11 a.m. ET conference call later Tuesday morning. Anyone interested can sign up for the webcast and submit questions for management.
Kitchener to host Ontario’s first legal cannabis festival
Circle September 7th on your calendars, Cannabis Pros, especially if you’ll be near southwestern Ontario around that time.
Bingemans, an outdoor conference centre and event venue near Kitchener, Ontario, will host the province’s first legal cannabis-centric one-day event on that day. The Ontario Cannabis Festival will have a strict BYOC (bring your own cannabis) policy, but that isn’t stopping organizers from attempting to pool resources in an attempt to break records by rolling the world’s longest joint.
“It’s going to take a lot of man and woman power - we looked around to see who attempted before to roll the world’s longest joint. Right now, the Guinness Book of World Records doesn’t recognize the world’s longest joint officially," organizer Tony Millar told Kitchener Today. "The longest we found was 104 feet, that was in Colorado - so we’re going to try and break it. So because consumers can legally only hold up to 30 grams, we’ll have over 50 people contribute about 30 grams each to the joint.”
Education will also be a major element of the event, with classes scheduled all day for people interested in learning how to roll a proper joint, how to grow their own flower and even how to extract their own cannabis oil to infuse into homemade edibles. Food trucks, cannabis accessory sellers, buskers and life music round out the offerings for the day.
Despite the legalization of recreational cannabis, public events focused around the now legal plant have struggled to gain acceptance. Last week, organizers of the Journey Cannabis and Music Festival originally set to take place in Vaughan, Ontario in late August were forced to cancel the event after the city passed a new bylaw prohibiting non-medical public cannabis consumption.
While anyone who purchased a ticket for the Journey festival can expect a full refund, Mr. Millar said they can also expect a discount if they’d like to attend his festival instead.