Investor Ideas Potcasts, Cannabis News and Stocks on the Move; Episode 467 (TSX: L) (TSX: FAF) (CSE: IMCC) (NASDAQ: NEPT)
Delta, Kelowna, BC - September 15, 2020 (Investorideas.com Newswire) www.Investorideas.com, a global news source covering leading sectors including marijuana and hemp stocks and its potcast site, www.potcasts.ca release today's podcast edition of cannabis news and stocks to watch plus insight from thought leaders and experts.
Listen to the podcast:
Investor Ideas Potcasts, Cannabis News and Stocks on the Move; Episode 467 (TSX: L) (TSX: FAF) (CSE: IMCC) (NASDAQ: NEPT)
Today's podcast overview/transcript:
Good afternoon and welcome to another episode of Investorideas.com "Potcast" featuring cannabis news, stocks to watch as well as insights from thought leaders and experts.
In today's podcast we look at a few public and private company announcements.
Loblaw Companies Ltd (TSX: L) has taken a significant step forward on its journey to provide Canadians with the convenience and security of a digitally connected healthcare network. Today, the Company announced that its wholly owned subsidiary Shoppers Drug Mart Inc. will invest $75 million in Maple Corporation, the leading virtual care provider in Canada, in exchange for a material minority stake in the company.
Maple is a thriving Canadian telemedicine provider that allows patients to connect online with a variety of healthcare professionals, including general practitioners, specialists and allied health professionals. As the country evolves to a more digitally enabled healthcare system, telemedicine/virtual care has emerged as a key enabler of reliable and convenient access to care. This investment is an important step as Shoppers Drug Mart looks to make this service more accessible, with a goal to provide a seamless experience for patients as they move between virtual and in-person care.
"The COVID-19 pandemic has proven that Canadians need new ways, particularly virtual ways, to get access to care," said Jeff Leger, President, Shoppers Drug Mart. "We know that the future of healthcare is digitally enabled. We believe that our store network and infrastructure, combined with Maple's technology can help better connect Canadians to the healthcare support they need, whenever and wherever they are."
Prior to the Transaction, Shoppers Drug Mart worked closely with Maple on two strategic initiatives that gave the Company an opportunity to more deeply understand Maple's service offering. Maple virtual care is currently available in more than 160 Shoppers Drug Mart locations in British Columbia. Additionally, in the early days of the COVID-19 pandemic, the two companies worked together to make virtual care more accessible for Canadians. In less than a month, this initiative enabled nearly 20,000 virtual care visits, during a time when Canadians were asked to stay home and stay safe. In addition to these initiatives, Maple's strong history of implementing custom telehealth solutions for governments, hospitals, employers, and insurers made the investment in Maple an attractive choice.
"We've watched virtual care solve some of the most complex healthcare issues around the globe, as well as right here in Canada through our own programs," says Dr. Brett Belchetz, CEO and Co-Founder of Maple. "We're thrilled to work hand-in-hand with Shoppers Drug Mart to bring the reliable, convenient, and high-quality access to care that we've developed over the past five years to more Canadians than ever before."
Led by Shoppers Drug Mart, the leader in Canada's retail drug store marketplace and the number one provider of pharmacy products and services, Loblaw offers full-service pharmacies and professional care from 5,000 healthcare professionals in more than 1,800 locations in 10 provinces and 2 territories. The investment in Maple is another critical building block in Loblaw's connected healthcare strategy, along with:
- QHR, a leader in the electronic medical records (EMR) market, providing software and a virtual care service (Medeo) for healthcare providers and their patients
- Wellwise, a retail experience from Shoppers Drug Mart, created for Canadians who want to take charge of the way they age
- The Health Clinic by Shoppers, managed primary-care and family practice clinics, providing patients with convenient, one-stop access to medical services and trusted advice
Financial and Operational Highlights for the Thirteen Weeks Ended August 1, 2020
- Total revenue of $28.6 million at a gross profit of 34.8%, compared to revenue of $11.1 million in Q2-2019 at a gross profit of 36.5% - representing a 158% increase in revenue year-over-year.
- Adjusted EBITDA1 (loss) of $0.3 million, reduced from $4.8 loss million in Q2-2019 through optimization of the retail store network.
- Completed the final steps required for licensing two cannabis retail store locations in the major urban market of Vancouver, British Columbia.
- Repayment of $28.2 million of debt including the principal amount of 8.0% unsecured convertible debentures and accrued and unpaid interest thereon.
- Entered into an amendment agreement which includes a proposed early exercise of the majority of Alimentation Couche-Tard's ("ACT") Series A warrants (through an indirect wholly-owned subsidiary) that, upon exercise, would result in ACT holding an approximate 15% ownership interest and gross proceeds to the Company of approximately $19 million in 2020.
- The proposed extension of the maturity date of the unsecured debentures held by ACT potentially increases operational flexibility.
- Opened two cannabis retail locations co-located with Circle K stores in the province of Alberta.
- Continued to refine the Company's business practices in response to the COVID-19 public health crisis and maintained continuity of operations through digital engagement with customers and best-in-class in-store safety protocols.
Subsequent Financial and Operational Highlights post August 1, 2020
- Acquired a prominent downtown Toronto cannabis retail store location at the high-traffic intersection of Yonge Street and Gerrard Street, in close proximity to Yonge-Dundas square.
- Launched the Revity CBD™ private label wellness brand driven by consumer insights in the underserved CBD market in the province of Saskatchewan, through the Company's wholly-owned distribution business, Open Fields Distribution™.
- Hifyre's Spark Perks™ member program achieved an increase of approximately 45,000 members since the beginning of Q2-2020 and now has more than 145,000 members in the program that typically visit more frequently and transact with higher basket sizes, compared to non-members.
- Continued to realize positive financial and operational results as a result of optimization of the retail store network with a focus on maximizing the number of retail stores delivering positive margin contribution.
"Fire & Flower continues to drive towards delivering positive adjusted EBITDA and during our second quarter of fiscal 2020, we have made meaningful progress towards this critical goal," shared Trevor Fencott, Chief Executive Officer of Fire & Flower. "We believe the Company is well positioned to expand its footprint in the Ontario market and expects to have access to the necessary capital to support our growth plans. As the cannabis and retail industry continue to adapt to the COVID-19 public health crisis, we will remain on the leading edge of driving consumer engagement in this dynamic environment."
IM Cannabis Corp. (CSE: IMCC), a multi-country operator in the medical cannabis sector with operations in Israel and across Europe, announced the first shipment from its EU-GMP supply partner into Germany. The Company is also announcing three new distribution agreements signed by its German subsidiary Adjupharm GmbH, bringing the total number of distributors in its German distribution network to ten.
"The German market is growing rapidly and we have executed on building an excellent foundation to distribute our proprietary products across the highly fragmented pharmacy channel. As we scale imports from our EU-GMP supply partners, we will continue to add new products and new formats for the German medical cannabis market to establish IMC as the favoured brand known for consistency and quality. Our vision for leadership in global medical cannabis is progressing well and we are on the right path to achieve this goal through a network of trusted partnerships that drive product volumes, brand recognition and shareholder value in the long-term," said Oren Shuster, CEO of IMC.
Expanding the German Distribution Platform
IMC has received the first commercial shipment of medical cannabis into Germany from its EU-GMP supply partner. The shipment has now been cleared by the German regulator and has been delivered to fulfill purchase commitments with ten distribution partners in Germany. These imports will be sold in Germany under the IMC brand.
IMC has also announced it has secured three new distribution agreements with additional partners in Germany that will sell IMC-branded cannabis (the "German Distribution Agreements"). All of the German Distribution Agreements include binding purchase commitments.
The German Distribution Agreements introduce the following distributors to IMC's existing German distribution network:
- Cansativa GmbH ("Cansativa") - Cansativa was founded in 2017 and, through two EU-GMP and EU-GDP licensed facilities in Germany, it has sold over 50,000 units of medical cannabis products;
- Ilios Sante GmbH ("Ilios") - Founded in 2018, Ilios is a EU-GDP certified wholesaler and importer of narcotics and pharmaceuticals, focusing on cannabinoids as an alternative medicine; and
- Farmako GmbH ("Farmako") - Farmako is a pharmaceutical wholesale based in Frankfurt. It was been distributing medical cannabis in Germany since March 2019 and is licensed to begin distribution operation in the U.K. Farmako is a subsidiary of AgraFlora Organics International Inc. (CSE:AGRA).
Through Adjupharm, IMC has binding purchase commitments for the sale of a total of 1,525kg of medical cannabis in Germany under existing purchase commitments, 823kg of which is expected to be delivered in 2020, both not including the German Distribution Agreements. Purchase commitments under the German Distribution Agreements are expected in the near term.
Neptune Wellness Solutions, Inc. (NASDAQ: NEPT) (TSX: NEPT), a diversified and fully integrated health and wellness company focused on natural, plant-based, sustainable, and purpose-driven lifestyle brands, announced that the Company has been listed #11 in the TSX30 program and named as one of Canada's top growing companies.
The Toronto Stock Exchange (TSX) ranked Neptune amongst the thirty top-performing TSX stocks over a three-year period based on dividend-adjusted share price appreciation, through inclusion in the TSX30 program. In addition, Neptune has been included in the Report on Business list of Canada's Top Growing Companies for its three-year cumulative revenue growth.
"Since Neptune first publicly listed its shares in 2011, the Toronto Stock Exchange has been an outstanding platform for North American investors to participate in the growth of our Company-especially in the past twelve months as we have transformed our business from primarily business-to-business and have extended our reach to business-to-consumer and direct-to-consumer," said Michael Cammarata, Chief Executive Officer and President of Neptune.
"The TSX provides us with increased exposure to the North American investment community on both the buy-side and sell-side, along with access to data that gives us the ability to understand our trading activity and how to better communicate with investors.
"This is a significant development and honour for Neptune. It reflects the strong performance of Neptune's business and our recent transformation as well as positive investor response and buy-in of our strategic vision to build a broad portfolio of natural, plant-based, and sustainable brands and consumer packaged products in key health and wellness markets, including hemp, nutraceuticals, personal care, and home care.
"It's particularly noteworthy that Neptune is honoured during the challenging COVID-19 pandemic," Mr. Cammarata added.
"I'm incredibly proud of how the entire Neptune team has persevered through these challenging times. The first quarter of fiscal 2021 marked a turning point for Neptune. We quadrupled first-quarter revenue to more than $21.3 million and generated gross profit margin improvements, which reflects increasing volumes and efficiencies. We attribute these milestones to our team's hard work and dedication to our mission of redefining health and wellness. They remained agile and responsive to changing market conditions amid the COVID-19 pandemic as we sped up new product initiatives and executed against the strategy of a fully integrated health and wellness business.
"We are building our brands and innovations, moving closer to the consumer, and offering exceptional service to our B2B customers. We now move forward with a focus on consumer product goods, a direct-to-consumer business model, and a goal to enhance our own intellectual property."
Both the TSX30 and Canada's Top Growing Companies programs launched in 2019. The TSX30 program includes companies from a wide range of sectors and serves to highlight the power and diversity of investment opportunities in Canada's world-class marketplace. The Report on Business Top Growing Companies award aims to celebrate entrepreneurial achievement by identifying and amplifying the success of growth-minded, independent businesses in Canada.
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