Indiva Limited is pleased to report results for the year ended December 31, 2018.
Q4 2018 and year-end financial results:
- For the fourth quarter and year-ended December 2018, Indiva reported $58,307 of net revenue, versus nil in 2017 and nil in Q3 2018. Revenue was derived almost entirely from wholesale sales of cannabis flower and clones, as Indiva’s contract with the OCS did not begin until Q1 2019.
- Operating expenses for Q4 were $2.77 million versus $1.32 million in Q4 2017. The increase was attributable to higher employee count and facility costs as operations and production grew, as well as higher marketing, investor relations and public company costs.
- Inventory at year-end stood at $1.16 million versus nil in the year-ago period.
- Cash position at year-end stood at $19.56 million.
Indiva’s achievements in 2018 and subsequent events:
- Completed a bought-deal equity financing in February 2018 for gross proceeds of $15 million.
- Created a JV with Bhang Corporation to produce and, subject to applicable regulatory approvals, distribute award-winning Bhang products on an exclusive basis in Canada, including chocolate, oral sprays, vape pens and other derivative cannabis products.
- Signed an exclusive licensing agreement with DeepCell Industries to produce and distribute, subject to applicable regulatory approvals, on an exclusive basis Ruby Sugar, Sapphire Salt and Gems as well as other DeepCell SKUs in development.
- Received our Sales License from Health Canada in August 2018.
- Signed an LOI to acquire a cultivation license in Denmark.
- Purchased the Company’s property and production facility in London, Ontario.
- In February, 2019, Indiva signed a supply agreement with the Ontario Cannabis Store (OCS.ca).
- On February 25, 2019, Indiva introduced its first products for sale into the recreational cannabis market in Canadaand launched its first two pre-roll SKUs, which are available in Ontario both online through the OCS.ca website and in cannabis stores in Ontario. After eight weeks of sales, INDIVA pre-rolls have achieved 9.5% market share in pre-rolls in Ontario.
- Construction of three (3) additional flower rooms is complete and the rooms are ready to be populated with plants, once licensed by Health Canada. The rooms were completed in February 2019, and final video submission was completed at the same time.
- Construction of five (5) additional flower rooms is substantially complete and is expected to be ready for a walk-through inspection to prepare a video package for Health Canada by early May.
- All long lead-time extraction, processing and major chocolate production equipment have been procured. Indiva expects to be, subject to applicable regulatory approvals, able to initially process 100kg of chocolate per hour as early as Q3 2019.
- Indiva is pleased to announce the recent hiring of Rob Carse as Vice President of Operations. Rob has 25 years of experience as a senior operations manager with Clorox, General Mills, Maple Leaf Foods and recently B&G (manufacturer of Green Giant foods).
- Indiva intends to introduce additional pre-roll SKUs as well as indica and sativa capsules in Q2 2019, all of which will be available at OCS.ca and in cannabis stores in Ontario.
- Indiva is in discussions with additional provincial wholesalers regarding the distribution of INDIVA products.
- Indiva intends to introduce tinctures, including indica oil and sativa oil, to medical patients in Q2 2019.
- Timeline remains on track to complete construction of a 70 tonne ethanol extraction system at Indiva’s facility in London, Ontario. Indiva continues to pursue B2B opportunities in extraction and processing, while maintaining capacity for its own needs.
- Indiva continues to prepare to open its own “farm-gate” store on site at its facility in London Ontario, subject to AGCO approval.
“We are delighted with the positive reception and early market share garnered by INDIVA pre-rolls in Ontario. We continue to negotiate with additional provincial wholesalers to increase distribution of INDIVA products to additional provinces in Canada. With new channels and additional products to be introduced beginning in Q2 through the OCS, as well as beginning direct-sales to medical patients, we expect revenue growth through 2019 and 2020. In particular, we are very excited about the expected introduction of Indiva’s derivative products, and subject to amended regulations, producing and distributing edible cannabis products in the Canadian market,” said Niel Marotta, President and CEO.