In the cannabis space this week, a data-focused company shared its positive predictions for the cannabis-infused beverages market.
Meanwhile, Statistics Canada released April marijuana sales numbers for the country, revealing a small drop in purchases after COVID-19 stockpiling caused a spike in March.
Read on for a closer look at some of the biggest cannabis news over the last five days.
Big prediction for cannabis beverages market
Prohibition Partners released a report on cannabis-infused beverages this week, saying it expects the global market to be worth US$1.82 billion by the end of 2020, and US$5.8 billion by 2024.
According to the marijuana research provider, all areas of the drinks industry are making moves into cannabis-infused beverages, and consumers are ready to buy in this market. Of the 15,000 adults in North America and Europe that Prohibition Partners polled, 16 percent said they have not yet tried a cannabis-infused drink, but are interested and will likely do so in the next year.
Other data indicates that 28 percent of people who have already tried a cannabis-infused beverage intend to buy more infused products in the next three months.
Click here to skip to the Investing News Network’s overview of the Prohibition Partners report.
“The global drinks market may be large but overall industry growth is slow with some analysts forecasting annual growth at around just 3%. Our research has found that cannabis-drinks, however, are poised for much bigger growth and point towards an almost 45% compound annual growth rate for the cannabis-infused segment of the drinks industry,” said Claire Birks, senior analyst at Prohibition Partners.
Prohibition Partners is clearly optimistic about the future for cannabis beverages, but it’s worth noting that their reach has been somewhat limited so far. For example, in Canada, Cannabis 2.0 products only became legal last fall, and it took longer than that for companies to be able to start selling drinks.
That said, sales do seem to be picking up, with recent data from the Ontario Cannabis Store showing that C$410,000 worth of beverages were sold from January to March.
Slight drop for Canadian cannabis sales
Statistics Canada provided the latest information on the country’s cannabis sales, revealing that the April number came in at C$180.15 million.
That’s down slightly from C$181.18 million in March, but up substantially compared to the first two months of the year, when marijuana sales in Canada came in at under C$155 million.
The increase in buying seen in March has been attributed to panic buying due to COVID-19. It was not initially clear whether cannabis stores would be able to stay open as provinces and territories across the country put measures in place to stop the spread of the disease, and as a result consumers rushed to stock up on their preferred products.
In total, eight of the country’s provinces and territories saw sales declines from March to April, with Prince Edward Island leading the way with the largest drop.
Marijuana financing activity picks up
Viridian Capital Advisors reported positive financing data this week on the cannabis industry.
The firm, which tracks investment and M&A activity in the marijuana space, said that during the week ended June 12, more dollars were raised than during the same week in 2019 — according to Viridian, that’s the first time this year that has happened. It was also the first week in 2020 that average tranche sizes were higher than they were last year.
“We recorded 7 capital raise transactions totaling $73.8 million, vs. 12 transactions totaling $71.8 million during the same week in 2019. Average tranche size was $10.5 million this week, vs. $6.0 million in the prior year period,” said Viridian.
MediPharm followed that news up this week by providing its latest quarterly results and entering into a supply agreement with a subsidiary of VIVO Cannabis (TSX:VIVO,OTCQX:VVCIF). The company’s results were not well received by the market, with its share price falling about 18 percent after their release — MediPharm reported a year-on-year revenue drop of 49 percent as well as a fall in adjusted EBITDA.
Cannabis company news
Company news in the cannabis space this week was centered largely on financings and quarterly results, plus the departure of one high-profile executive.
- Floundering Acreage Holdings (CSE:ACRG.U,OTCQX:ACRGF) announced a $15 million short-term loan with an annual interest rate of 60 percent. The deal is with an unnamed institutional investor, and it comes not long after the company announced two other definitive funding agreements for a total of $60 million. Both amounts will be used for working capital and general corporate purposes.
- Steve Dobler, co-founder of Aurora Cannabis (TSX:ACB,NYSE:ACB), will retire from his positions as the company’s president and director as of June 30. Dobler co-founded Aurora with Terry Booth, who retired from his position as CEO earlier this year. Since Booth’s departure, Aurora has made an effort to restructure.
- Delta 9 Cannabis (TSX:DN,OTCQX:VRNDF) entered into a partnership to be the exclusive cannabis partner of the Manitoba Hotel Association. Under the agreement, Delta 9 will help members of the association become cannabis retailers and will be able to distribute its products in Manitoba hotels. Also this week, Delta 9 entered the Newfoundland and Labrador market and opened a store in Grande Prairie, Alberta.
- Also raising money this week was HEXO (TSX:HEXO,NYSE:HEXO), which established an at-the-market offering program that will allow it to issue up to C$34.5 million worth of common shares to the public “from time to time.” It also closed the sale of its Niagara, Ontario, facility for about $10.25 million. The funds from the sale will be used partially to expand HEXO’s Belleville, Ontario, facility.
- High Tide (CSE:HITI,OTCQB:HITIF) released its latest quarterly results, reporting a year-on-year revenue increase of 197 percent to C$19.57 million. Its adjusted EBITDA rose 156 percent over the same period, clocking in at C$1.94 million. President and CEO Raj Grover described the company’s adjusted EBITDA number as “well ahead of (High Tide’s) peer group.”
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Meanwhile, two longstanding cannabis partners ended their relationship.
Trulieve to donate $20,000 in scholarship funding and $15,000 to support leadership development
Trulieve Cannabis Corp . (CSE: TRUL) (OTC: TCNNF), a leading and top-performing cannabis company in the United States today announced a new partnership with the Thurgood Marshall College Fund (TMCF), the nation’s largest organization exclusively representing the Black College Community. Trulieve will donate $20,000 to help fund several college scholarships awarded to students who are attending one of the organization’s member-schools as part of Trulieve’s diversity, equity, and inclusion initiatives. The $15,000 in talent funding is earmarked to support TMCF’s internship program, reaching a diverse talent pool of students and alumni from their 47 member-schools to provide immersive experiences at Trulieve.
The new dispensary expands patient access to Florida’s largest inventory of medical cannabis products
Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) (“Trulieve” or “the Company”), a leading and top-performing cannabis company based in the United States announced today the opening of a brand-new Florida dispensary, the Company’s 80th nationwide. The new location marks the Company’s first in Tamarac and third in Broward County expanding patient access to Florida’s largest and broadest assortment of high-quality medical cannabis products.
Revive Therapeutics Provides Update on FDA Phase 3 Clinical Trial for Bucillamine in COVID-19 with Planned Completion and Emergency Use Authorization Request
Revive Therapeutics Ltd. (“Revive” or the “Company”) (CSE: RVV, USA: RVVTF), a specialty life sciences company focused on the research and development of therapeutics for medical needs and rare disorders, is pleased to announce an update on the Company’s U.S. Food & Drug Administration (“FDA”) Phase 3 clinical trial (the “Study”) to evaluate the safety and efficacy of Bucillamine in patients with mild to moderate COVID-19.
With its recent $23 million dollar financing, the Company plans to aggressively expand from 14 clinical sites to up to 50 clinical sites to meet the next enrollment goals for the Study in Q2-2020. The Study is a randomized, double-blinded, placebo-controlled trial and the safety and efficacy data analyzed at each interim analysis timepoint of 210, 400, 600 and 800 completed patients are only made available to the Independent Data and Safety Monitoring Board (“DSMB”) for review and recommendations on continuation, stopping or changes to the conduct of the Study. In the event of any serious safety concerns, the DSMB would be notified to determine any risks and provide its recommendations. To date, in this initial 210 interim point there have been no serious safety concerns that required the DSMB to be notified.
HempFusion Wellness Inc. (TSX:CBD.U) (OTCQX:CBDHF) (FWB:8OO) (“HempFusion” or the “Company”), a leading health and wellness CBD company utilizing the power of whole-food hemp nutrition, is pleased to announce that its common shares have been approved for DTC full-service eligibility in the United States by the Depository Trust Company (“DTC”) and can now be both traded and serviced through DTC’s electronic book-entry system.
DTC is a subsidiary of the Depository Trust & Clearing Corp. (“DTCC”) that provides clearing and settlement services for the financial markets and settles the majority of securities transactions in the United States. This electronic method of clearing securities speeds up the receipt of stock and cash and thus accelerates the settlement process for investors and brokers, enabling the stock to be traded over a much wider selection of brokerage firms.