Search Results for: Golden Leaf Holdings

Golden Leaf Holdings Looks Forward To Cannabis Referendum In Oregon

OREGON: Golden Leaf Holdings has released an update on GLH’s operating plan regarding the start of the recreational market in Oregon and the local Marion County referendum coming up for vote on November 8, 2016.  On this day, voters in Marion County will decide whether or not recreational sales and production will be allowed.

While some counties have chosen to opt-out of allowing licensed marijuana business to participate in the recreational market, Oregonians have embraced the industry overall as shown by increased sales and a demand for high-quality branded products. It’s been over a year since recreational or “Adult Use” cannabis became legal in Oregon and sales are generating millions in tax revenue for the state.

Don Robinson, Chief Executive Officer of GLH commented, “The topic of Marion County has been discussed since the implementation of the Marion County Ordinance last year and we have taken necessary steps to minimize any impact that a moratorium would have on our business. We have secured another property in Multnomah County and we are well positioned in the Adult Use market regardless of the outcome in Marion County.”

As previously communicated, Golden Leaf Holdings has a facility in Marion County at its Aurora Campus that has been under a county wide ordinance allowing existing medical marijuana businesses to operate, but prohibiting the establishment of recreational or “Adult Use” businesses. GLH has been operating under its existing medical processor registration.  Over the last nine months the Company has developed a strategic operating plan flexible enough to accommodate the eventuality of a negative or positive outcome of the Marion County referendum, including the leasing of another Portland based property in Multnomah County for recreational production, and is positioned to do well in either scenario. The cost of commissioning the Portland location has already been budgeted and accounted for in the Company’s financials. Regardless of the outcome of the vote, the Company believes its business prospects will be better because of the climate of certainty it will have with which to make decisions. This regulatory uncertainty led to inefficiencies as GLH has had to be prepared to deal with an outcome either way.

If the vote comes out in favor of the “opt out”, GLH will focus its operations at its leased facility in Portland and expand the operations there.  In this scenario, GLH anticipates that it would sell the Marion County property and remove $3 million worth of debt off of its books. As an alternative, or during the period while the property is up for sale, the Company believes it could lease out a large portion of the property actually making it revenue positive. It has received many leasing inquiries from interested parties involved with traditional agriculture.

If the vote goes positively and recreational businesses are allowed in Marion Country, the ordinance will not be changed until around January 2nd 2017. Given the standard timelines associated with receiving a recreational marijuana license from the Oregon Liquor Control Commission, GLH would not anticipate the license to be in place prior to Q2 2017. As such, in order to sell products into the recreational market, the Company expects and already has plans ready to move all production to the Multnomah Country location for a period of time until the Aurora location would receive its recreational license. The Aurora location could be used for limited medical marijuana production during the remainder of 2016 and early 2017.

Golden Leaf Holdings Ltd Announces Resignation of Chief Financial Officer

CANADA: Golden Leaf Holdings Ltd., a leading cannabis oil solutions company built around recognized brands, today announced that the Company’s Chief Financial Officer, Brian Gentry, for personal reasons is resigning.

For the indefinite future, Mr. Gentry will continue to serve GLH in a financial consulting role to ensure a smooth transition. The Company has commenced a search for a new Chief Financial Officer.

Don Robinson, GLH’s Chief Executive Officer, said, “We appreciate Brian’s contributions to GLH over the past year in helping us build our business. We wish him well in the future as he pursues other opportunities.”

Golden Leaf Holdings Announces Preliminary Results for July 2016

 Oregon and Washington State Brands Report 15% Combined Monthly Sales Growth

WASHINGTON: Golden Leaf Holdings, a leading cannabis oil solutions company built around recognized brands, today announced preliminary revenue results for July 2016 for the respective brands of the Company in Oregon and strategic partner, BMF Washington.

 Oregon and Washington State Brand Revenue Update

 Preliminary results show that combined brand sales for GLH and BMF in Oregon and Washington were estimated at US$1.6 million in unaudited revenue for July 2016, as compared to unaudited revenue of US$1.4 million for June 2016, representing a month-over-month increase of 14%.

 GLH posted preliminary results for July 2016 showing US$914,000 in estimated and unaudited revenue as compared to US$891,000 (updated and revised from previously published number of US$923,000) in June 2016, representing a month-over-month increase of 2.6%.  BMF’s July 2016 unaudited and estimated revenue in Washington State was US$728,665, a month-over-month increase of 35% from June 2016’s revenue of US$537,880.

 GLH Contract Grow Update

 In connection with the Company’s successful contract trim buying strategy, the first contract cannabis grow is underway and the harvest is anticipated to commence in October of 2016.  GLH will leverage the supply agreement that dictates guidelines for grow conditions and strain types to obtain flower and trim for its portfolio of branded products.  This strategic approach to sourcing raw materials reinforces the Company’s position as a leader in the industry and provides a cost effective method to support higher product margins and consistent, high quality supply to meet the market demand.

Don Robinson, GLH CEO commented, “We are looking forward to October 2016 and harvesting plants from our first contract grow.  This strategic supply agreement is expected to help support our raw material requirements while ensuring only the highest level of quality and variety demanded by our consumers.”

 

Golden Leaf Holdings Announces Q2 2016 and June 2016 Preliminary Results For Oregon And Washington State Brands

OREGON: Golden Leaf Holdings Ltd. (“GLH” or the “Company”) (CSE: GLH), a leading cannabis oil solutions company built around recognized brands, today announced preliminary revenue results for Q2 2016 and June 2016 for the respective brands of the company in Oregon and strategic partner BMF Washington.

GLH Oregon Revenue Overview

Preliminary results show that GLH generated US$3,011,000 in estimated and unaudited revenue for Q2 2016 as compared to unaudited revenue of US$2,476,688 for Q1 2016, representing a quarter over quarter increase of 21.5%.

The Company posted preliminary results for June 2016 showing UD$923,000 in estimated and unaudited revenue as compared to US$1,067,000 (updated and revised from previously published number) in May 2016, representing a month over month decrease of 13.5%. GLH sold all of the products that it produced in the month of June.

GLH experienced lower than anticipated revenue in June 2016 due to a variety of unexpected challenges. The Company is developing plans to address these variables as shown below:

Issue Proactive Response
Production obstacles, including cash constraints that impacted trim and flower purchases, trim quality issues and product testing delays from 3rd party vendors made it more challenging to source material inputs and produce product in a timely manner. GLH is leveraging cash from current convertible debenture funding to fulfill raw material requirements. The Company has developed a strategic trim supply agreement program focused on contracting with selected farmers to obtain low cost supply of high quality flower and trim with specific strain and genetic characteristics. GLH purchased new testing equipment to ensure the quality of trim and efficiency of testing timelines. The Company is building relationships with testing vendors to effectively manage testing bottlenecks.
The Oregon cannabis market saw slower than expected recreational consumer adoption of oils and extracts. The concept of using a vape pen for delivery and usage of marijuana is still relatively new for the average recreational user. The Company is working with dispensaries to provide merchandising tools that educate the consumer on the benefits of cannabis oil and new delivery systems.
The retail buying process at medical marijuana dispensaries, including effective purchasing and supply chain management is still evolving. Not all dispensaries stocked the appropriate inventory to meet new recreational consumer demand. Dispensaries are becoming more familiar with customers buying behavior, but room for improvement exists with raising the level of sophistication as it relates to inventory management and regular purchasing patterns. GLH is working closely with dispensary customers to help manage stock levels and ordering cycles.

Don Robinson, Chief Executive Officer of GLH, commented, “While June 2016 Oregon sales results were lower than expected, we were encouraged by the strong sell through of all available inventory produced. We were also pleased with the positive consumer response to the relaunch of the Golden brand and the new product launch of Private Stash. Our sales and marketing team worked with dispensaries across the state to not only introduce new products but new merchandising tools that elevated the consumers’ shopping experience and increased brand awareness.”

BMF Washington Revenue Overview

Preliminary results show that BMF generated US$1,370,445 in estimated and unaudited revenue for Q2 2016 as compared to unaudited revenue of US$904,359 for Q1 2016, representing a quarter over quarter increase of 51.5%BMF’s June 2016 unaudited and estimated revenue in Washington state was US$537,880, a month over month increase of 13% from May 2016 of US$475,457.

Golden Leaf Secures City Licenses to Sell Cannabis In Additional Nevada Jurisdictions

OREGON: Golden Leaf Holdings Ltd., a leading cannabis oil solutions company and dispensary operator built around recognized brands, has announced that it has been granted business licenses by Henderson County and Washoe County, in the State of Nevada, to sell cannabis to the adult-use markets in these locations. The Company plans to commence sales in these jurisdictions immediately.

The Company previously announced in September 2017 that it secured a business license to sell into the adult‐use market in the city of Sparks, Nevada, and the acquisition of a state-wide cultivation and extraction license in Nevada, in March 2017. Receiving these licenses is expected to enable the Company to expand beyond its home market of Oregon, and to sell its high quality cannabis-infused products to a larger market. The Company continues to work towards securing the requisite licenses to sell into Las Vegas, which requires a separate license.  

Mr. William Simpson, Chief Executive Officer of the Company, commented, “We remain committed to replicating our successful Oregon operating model of building out an internally produced and distributed portfolio of premium cannabis brands, sold through a channel of retail dispensaries.  Securing these additional city licenses in Nevada supports this key strategic initiative, as Nevada became the fifth state to allow adult-use cannabis sales earlier this year, opening a new market opportunity for Golden Leaf. We have already begun to gain early sales traction in Reno, Nevada, where we are using a licensed distributor to generate sales, as well as in Sparks, Nevada, and look forward to continuing to expand our customer base and product reach.”

LCB Says Licensed Marijuana Canopy Enough To Meet WA Recreational And Medical Marijuana Market Demand

WASHINGTON: The amount of marijuana allowed to be grown by state-licensed producers in Washington is enough to satisfy both the medical and recreational marijuana markets, a University of Washington study finds.

The state Liquor and Cannabis Board (LCB) tasked the UW-based Cannabis Law and Policy Project (CLPP) with calculating the “grow canopy,” or square footage, required to supply the state’s medical marijuana market as it becomes folded into the state’s retail system, as required by the 2015 Cannabis Patient Protection Act. The group’s report estimates that between 1.7 and 2 million square feet — or the equivalent of 30 to 34 football fields — of plants is needed to satisfy the medical marijuana market, and concludes that the 12.3 million square feet of canopy currently approved by the LCB is enough to supply the state’s total marijuana market.

Beau Whitney, a leading economist in the cannabis space, has looked into the proposed expansion of the retail stores thinks that is misleading, “Sure on the surface, there is enough supply to support the expansion, but the system is unsustainable at the current tax level of 37% + 9% local tax. With such high levels of taxation, we are looking at sustaining over $320M in black market demand-based activities. The only way to ensure a viable retail system is by lowering prices, through reduced taxes, and driving more people into the regulated systems.”

Mr. Whitney recently published a white paper on the Oregon retail market, and will publish a Washington retail white paper in early June. He is also the VP of Regulatory (Compliance) and Governmental Affairs for Golden Leaf Holdings. 

Medical marijuana dispensaries must either obtain a state license or close by July 1, 2016. Of the 343 retail stores licensed by the LCB, approximately 81 percent have sought endorsements to their license to sell marijuana to authorized medical patients.

“It was important to design this study the right way and engage in careful empirical research reaching out directly to medical dispensaries and growers across the state,” said Sean O’Connor, principal investigator for the report, CLPP faculty director and Boeing International Professor at UW Law.

CLPP Executive Director Sam Mendez described the survey process: “There’s no master list of these dispensaries, so we used a variety of resources to identify as many as possible. Once the survey was complete, we applied the findings to other published research regarding averages of marijuana output per square foot, outdoor and indoor growing market share and amounts used for edibles and concentrates to reach our estimates.”

The report found that:

  • There were an estimated 273 medical marijuana dispensaries in Washington in January 2016
  • Dispensaries sell an average of 9.55 pounds of marijuana flower monthly
  • The average price of marijuana per gram sold by these dispensaries is less than $10
  • Marijuana flower comprises 60 percent of sales at dispensaries, followed by concentrates (22 percent) and edibles (18 percent)
  • The potential market value based on 10 million square feet of canopy is more than $8 billion

Study Methodology

Determining the size of Washington’s medical marijuana market was no easy task for the UW team, since dispensaries and collective gardens have gone mostly unregulated until recently. The UW researchers, which included five law students, started by compiling a list of possible Washington dispensaries using the databases of three websites — leafly.com, weedmaps.com and headshopfinder.com — among other sources. They came up with 467 possible contacts and called them for phone surveys in January and February 2016.

Interviewees were asked whether the dispensary grows its own marijuana, how much marijuana it sells, the average price of various products and what proportion of sales are flower, edibles, tinctures and concentrates, among other questions. Some refused to participate. Others did not appear to be affiliated with a dispensary or seemed to be out of business. The researchers also posted an online survey, sending it to all applicants for recreational marijuana retail licenses and promoting it widely through social media. All told, they found 273 likely dispensaries.

A report released in December 2015 by BOTEC Analysis Corp. estimated that the state’s marijuana market is divided roughly into thirds for medical, recreational and illicit use. Since February 2014, as an interim policy, the LCB has restricted marijuana producers to a single license. That decision will later be put into rule.

The Cannabis Law and Policy Project was launched in 2014 to provide thoughtful leadership on the responsible development of recreational and medical marijuana industries in Washington State and across the country. The group, which is based in the UW School of Law, but draws on experts in various other departments, focuses on advising the state on regulatory issues related to marijuana.

 

The report’s lead authors are O’Connor and Mendez, with contributing law student authors Ada Danelo, Harry Fukano, Kyle Johnson, Chad Law and Daniel Shortt. Dr. Nephi Stella, a professor in the UW School of Medicine, was a consultant on the report.