- Q1 2019 cash receipts up 30% over last quarter
- Hydroponics equipment unaudited revenue $991,000 in Q1 2019 - 22% quarter growth
- Cultivation activities at Queensland Strain R&D and Cultivation Facility commenced
- Export Licence application lodged for export of medicinal cannabis from Australia
- Acquisition of cannabis production facility development in Nova Scotia, Canada completed
- First step in Asian Markets Strategy - partnership in Malaysia with bio-tech firm for medicinal cannabis R&D and government liaison
- Share Purchase Plan conducted raising $3 million
THC Global's hydroponics equipment division has reported an unaudited revenue for Q1 2019 of $991,000 ($3.964 million annualised) representing growth of 22% over Q4 2018. This has been driven by stronger sales within certain product lines as well as a broader distribution network across North America, Europe, and now the United Kingdom.
Cash receipts from customers per the Appendix 4C for the Company in Q1 2019 has also increased by 30% on the last quarter to $843,000.
Australian Cannabis Operations
The Company received cultivation permits in late December for its Queensland Strain R&D and Cultivation Facility in Bundaberg, Queensland. Cultivation activities under this permit commenced in early Q1 2019 using the Company's proprietary strains which are expected to be high yielding plants genetically suited for greenhouse cultivation in sub-tropical climates such as North Eastern Australia.
The Company has also applied for an Export Licence from the Australian Office of Drug Control for the export of medicinal cannabis.
Canadian Cultivation Facility
In March 2019, THC Global announced that it had completed the acquisition of a property in Nova Scotia, Canada which was in the process of being developed into a cannabis production facility. The Company will complete this development in two primary stages being a Cultivation Stage (Stage 1) and a Manufacturing Stage (Stage 2). The initial Stage 1 facility will be a 20,000 sqft project which is expected to deliver near term profitability. Once completed, the full Stage 1 development is expected to yield approximately 80,000 pounds of dried flower annually. The Company presently intends to fund this project through debt and hybrid financing rather than using existing cash.
Asian Markets Strategy
THC Global secured the first step of its Asian Markets Strategy in the past few months, having secured a partnership with Heleogenics, a Malaysian bio-tech firm to both explore joint research and development opportunities in Malaysia, as well as engage in government liaison advocating for medicinal cannabis. THC Global has identified a number of further potential partners in other key Asian markets and is progressing negotiations with them. THC Global's intention is to secure partners in specific complementary industries such as bio-tech in order to benefit from specific competitive advantages held by partners locally.
Successful Capital Raising
THC Global has closed its Share Purchase Plan (SPP) on Friday, 26 April 2019. The SPP raised $3 million (subject to funds clearance and audit). The Company expects to issue the shares under the SPP on Monday, 6 May 2019. The Company additionally raised $420,200 from the conversion of THCO Options in April 2019, which combined with the SPP provides a significant boost to the Company's cash balance following the end of the March quarter.
About THC Global Group Limited
THC Global Group Limited (ASX:THC) (OTCMKTS:HDRPF) (FRA:9TH) operates under a 'Farm to Pharma' pharmaceutical model, now holding all three key cannabis licences being a Cannabis Research Licence, a Medicinal Cannabis Licence (Cultivation), and a Manufacture Licence through its domestic medicinal cannabis subsidiaries THC Pharma and Canndeo. THC Global has secured a significant cannabis growing capacity over multiple cultivation projects and owns a pharmaceuticals bio-manufacturing facility with attached testing and product development laboratory. THC Global is in prime position to commence medicinal cannabis production to service both domestic patients and the global export market. THC Global is active globally with operations in Australia, New Zealand, and Canada and partnerships across Europe, Asia, and the Middle East. In addition to its core Australian medicinal cannabis assets, THC Global has a significant Canadian presence – both in cannabis and in hydroponics equipment. THC Global's Canadian cannabis operation, Vertical Canna, holds property in Nova Scotia, Canada being developed into a large scale cannabis production site. THC Global's hydroponics equipment division, Crystal Mountain, is a revenue generating manufacturer, wholesaler, and retailer of hydroponic equipment and supplies.
THC Global Group Limited