Tilray 3Q F2018 Rundown – Sept 30, 2018

  USD unless noted. Last Q we noted on the Rundown and on “Inside The Ropes” podcast that Tilray had very little Finished Goods Inventory of Flower $89k and Extracts $361k at the end of the last Q and net decrease in overall cannabis inventory [decreased $913k].  We surmised that this would lead to either constrained sales growth unless they bought from 3rd parties, and if they did buy from third parties… a hit to gross margin. We have also repeatedly noted that NOT ONE financial media company has brought this…

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Canopy Growth Q2 F2019 Rundown Sept. 30, 2018

After doing TRST last night, this is a sober reminder of the fact that this industry has a looong way to go.   To be fair to ACB, where I inserted a similar narrative for those that do not read the entire post,.… I will also talk about Net Operating Profit versus Net Income here.   CGC lost $330 million Net Income for the Q, with IFRS voodoo removed it was negative $290 million. Their Net Operating Income with IFRS voodoo backed out was negative $174 million. Net Operating Profit is…

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Live from MJBizCon 2018 – Vegas

Well. There's big, and then there's this. I don't know the number of people here, but it's into the tens of thousands. And the price of admission keeps the circus folk out - the expense account set who blaze all day in front of the hall admiring each other's weed while 'networking'. That's not to say there isn't gear here, there is. And boy, does it stink. I can summarize MJBizCon in 4 words: Extraction, terpenes, vapes, and lighting. There is an alcohol/beer tilt: Health Canada would lose their shit over…

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CannTrust 3rd Q F2018 Rundown – Sept 30, 2018

Well ain’t you a pleasure to review!! Positive EBITDA, FG inv growth, strong sales growth, Nice Production to Sales delta.  Rogers and Ravensdale will be finding work pretty quickly given these results.   Open up the Fins and MDA and follow along.   Sales   An increase of 39% to $12.6 million [comparable to Tilray!!] Grams sold of flower dropped 14% QoQ but price per gram went up 16% to $8.77 = $3.5 million Extract went up to a new record of 699 kgs up 17% with price dropping less than…

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Cronos Q3 F18 Rundown Sept 30, 2018

Open up the financials and MDA and follow along. Sales Cronos evidenced a $0.4 million or 11% in crease in sales to $3.8 million.  They have some new disclosure that wasn’t available last Q, so I cannot track down the exact location of increase but I believe it to be all oil related.  Oil now constitutes 29% of overall sales. International sales make up $0.6 million of sales or 15% of mix. Again, new disclosure so no comparative. Sale price per gram increased to $7.32 from $7.12 likely due to higher…

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Aurora Rundown Q1 F2019 Sept 30, 2018

Open the financial statements and MDA and follow along.   I said this last rundown for ACB….   "As a generalization…. If you take two firms with negative Adj EBITDA and you combine them the first Q will never look pretty [See Canopy-Mettrum].  You might get sales boost and other improvements, but to squeeze out synergies takes more than the first Q.  You throw in a huge ramp of Selling expenses and G&A to Day 1 of rec… and these results shouldn’t be too shocking [Illumination series was a cost with…

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The Year of the Breeder

When I was at the Vancouver Lift Expo in early January 2018, one of the panelists in one of the sessions declared 2018 to be the: ‘Year of Ancillary’. Pretty much nailed it. It’s wasn't that producers were going to immediately stop being fashionable for investors. It meant that the businesses surrounding the entire cannabis complex will start beginning to really hop. Packaging manufacturers. Testing companies. Those that support the core of production and processing and distribution - but aren't it. Lifestyle publications and information sources and bong makers and nutrient companies and…

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On the Road Again

In the aftermath of ‎WeCann™2018, I find myself a little tired, but also fired up 'tween the ears. Over the last while, our crew (and poor Blue) has had to suffer listening to my musings about cannabis being 'disruptive'. Kinda like how Uber and AirBnB are in their respective space. Cannabis ain't a technology tho. It's just a plant, right? Yeah. I've a favorite line I repeat to anyone unlucky enough to have asked my opinion. That cannabis lies at the intersection of many, many commercial roads. Recreational. CPG. Pharma. Ancillary.…

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Molly’s Trading Post: Closed for Business

I'm not going to go forward with the Trading Post. Over WeCann™, I spoke with a raft of people. And I also learned that without knowledge, context, and experience: concepts can be easily misconstrued. There might be miscommunication/misunderstanding. Perhaps someone skips a part. Maybe only get halfway through, and want to go rather than read the manual. Happens all the time. In all these cases, the potential downside is greater than the potential upside for TheCannalysts professionally, and me personally. Because I don't want to see someone beach on the rocks.…

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