Proactiveinvestors United Kingdom THC Global Group Ltd https://www.proactiveinvestors.co.uk Proactiveinvestors United Kingdom THC Global Group Ltd RSS feed en Sun, 26 May 2019 13:10:15 +0100 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - THC Global shares rise after securing medicinal cannabis export licence ]]> https://www.proactiveinvestors.co.uk/companies/news/220263/thc-global-shares-rise-after-securing-medicinal-cannabis-export-licence-220263.html THC Global Group Ltd’s (ASX:THC) shares are trading about 8% higher intra-day after being granted a medicinal cannabis export licence by the Australian Office of Drug Control (ODC).

Securing this licence is a key milestone in developing a future export pathway of THC Global’s Australian cannabis and places the company in an increasingly stronger position to take advantage of its industry leading manufacturing capability and its global reach.

Northern NSW cultivation – increased cultivation capacity

THC Global has confirmed its binding intention with EVE Investments Ltd (ASX:EVE) to lease additional USDA certified organic land to bring the total leased land for the Northern NSW cannabis cultivation site up to a potential 150,000 square metres.

The lease is subject to THC Global confirming that the additional land is suitable for lodgement of a cultivation licence application with the ODC.

READ: THC Global raises nearly $3 million to fund transition into full-scale medicinal cannabis production

The currently leased 60,000 square metre land is the subject of a medicinal cannabis cultivation licence lodged by THC Global last year, which has now progressed to “assessment phase” by the ODC and is expected to be received this year.

Receipt of this licence will allow for the first part of the extended project to commence which is expected to deliver biomass for production at THC Global’s biopharmaceutical manufacturing facility as well as for supply to EVE under an off-take agreement for Meluka Health’s proposed cannabis honey product.

Product development at manufacturing facility

THC Global has received in-principle advice from the Therapeutic Goods Administration (TGA) advising that subject to relevant licencing and approval of procedures, both cannabis and non-cannabis products will be able to be produced from the company’s Queensland bio-pharmaceuticals extraction facility.

This will provide THC Global with the ability to monetise excess production capacity through extraction of other botanicals for medical, pharmaceutical, or nutraceutical purposes as the company progressively increases cannabis extraction activities.

READ: THC Global Group progresses core drivers of revenue growth

Successful pilot-scale extraction of tea-tree product has been completed for EVE as part of the collaboration agreement with THC Global.

The potential to conduct other complex botanical extractions at large scale is being explored, which may enable the formulation of novel cannabis-blended products for sale into other markets.

EVE partnership

THC Global remains committed to the cannabis off-take agreement with EVE whereby EVE will be able to purchase cannabis cultivated at the Northern NSW site for producing cannabis honey products under their Meluka Health brand.

Additionally, THC Global’s expansion into new markets such as Canada, New Zealand, and the Asian region may provide stronger routes to market for EVE’s cannabis honey product whilst also expanding THC Global’s product offering internationally.

READ: THC Global acquires site in Canada for cannabis production

THC Global chief executive officer Ken Charteris said: “We are pleased to be able to secure additional land for our cannabis cultivation activities on EVE’s USDA certified organic land in Northern NSW.

“We will formally commit to the lease and settle terms upon confirmation that THC Global will be able to receive a medicinal cannabis cultivation licence over this extension.

“Additionally, our success in using our bio-pharmaceutical manufacturing facility for other complex botanical extractions, including EVE’s tea-tree product, confirms that we may be able to explore the development of novel cannabis-blended formulations in the near future.”

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Wed, 15 May 2019 10:20:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/220263/thc-global-shares-rise-after-securing-medicinal-cannabis-export-licence-220263.html
<![CDATA[News - THC Global raises nearly $3 million to fund transition into full-scale medicinal cannabis production ]]> https://www.proactiveinvestors.co.uk/companies/news/219740/thc-global-raises-nearly-3-million-to-fund-transition-into-full-scale-medicinal-cannabis-production-219740.html THC Global Group Ltd (ASX:THC) has confirmed that the final amount raised in its share purchase plan conducted in April this year totalled $2.983 million from a total of 545 applicants.

The company yesterday issued 5.967 million fully paid ordinary shares at an issue price of 50 cents a share to conclude the purchase plan.

Funds raised will be used to progress THC’s Australian medicinal cannabis activities as it transitions to full-scale production, as well as general working capital.

READ: THC Global Group progresses core drivers of revenue growth

The Australian cannabis company is awaiting final licencing and permitting approvals for a Canadian facility now owned by subsidiary Canndeo, which it plans to progress to a full-scale operation as part of a farm-to-pharma business model.

Cultivation activities at the Canndeo research and development facility have started following receipt of the relevant permits.

A manufacturing licence for the site is likely to facilitate product validation and study trial production.

READ: THC Global’s Canadian division boosts revenue 22% in March quarter

In November last year, THC supplied Endoca CBD products to its first prescribed patients.

The supply verified THC Global’s pathway from manufacturer to patient under federal authorised prescriber and special access schemes and state regulations.

THC imports four products from Endoca’s range: Endoca’s CBD oil in 3% and 15% concentrations; and Endoca’s unique CBD-plus-CBDa oils, also in 3% and 15% concentrations.

The company is also exploring strategic opportunities in Asia.

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Mon, 06 May 2019 20:10:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/219740/thc-global-raises-nearly-3-million-to-fund-transition-into-full-scale-medicinal-cannabis-production-219740.html
<![CDATA[News - THC Global Group progresses core drivers of revenue growth ]]> https://www.proactiveinvestors.co.uk/companies/news/218812/thc-global-group-progresses-core-drivers-of-revenue-growth-218812.html THC Global Group Ltd (ASX:THC) (FRA:9TH) (OTCMKTS:HDRPF) specialises in medicinal cannabis supply and development as well as hydroponics equipment manufacturing and distribution. It was previously known as The Hydroponics Company Ltd and is run by Ken Charteris, group chief executive officer, with three decades of experience in biotechnology and pharmaceutical company leadership.

He has managed companies with revenues of more than $200 million and asset bases of up to $500 million. Charteris is instrumental in executing the company’s strategic plan and is focused on acquisitions and alliances for the dual-listed group.

What is THC Global progressing?

THC Global is a rapidly growing company which went from having $1.1 million issued capital on January 1, 2017, to $23 million of issued capital on December 31 last year.

Growth in the company's issued capital last year was $5.5 million or 32%.

The company is awaiting final licensing and permitting approvals for a Canadian facility now owned by subsidiary Canndeo and noted in February 2019 it plans to progress to a full-scale operation as part of a farm-to-pharma business model.

The Australian company’s main pharmaceuticals focus is on the development and delivery of cannabidiol (CBD) products to the Australian and New Zealand markets, and the Canadian markets through wholly-owned subsidiary Vertical Canna Inc.

THC Global plans to build out a vertically integrated cannabis business across North America through Vertical Canna, using an aquisitions and partnerships model.

Vertical Canna directed efforts in 2018 towards developing a retail cannabis and equipment brand for sales in Canadian stores.

In November 2018 THC Global supplied Endoca CBD products to its first prescribed Australian patients.

The supply verified THC Global’s product pathway from manufacturer to patient under federal authorised prescriber and special access schemes and state regulations.

THC Global imports four products from Endoca’s range: Endoca’s CBD oil in 3% and 15% concentrations; and Endoca’s unique CBD-plus-CBDa oils, also in 3% and 15% concentrations.

The company is also exploring strategic opportunities in Asia.

THC Global has begun cultivation activities at its Canndeo R&D facility in Canada, having received the relevant cultivation permits. A manufacturing licence for the site is likely to facilitate product validation and study trial production.

On the group’s existing manufacturing front, a second core company activity is in the manufacture and distribution of hydroponics equipment, materials and nutrients.

Group CEO Ken Charteris is executing the company’s strategic vision and has advanced it over the past 2.5 years by driving the acquisition of THC Global’s existing manufacturing facility and securing commercial partnerships with Endoca (Europe) and Ascent Industries (North America).

THC Global’s hydroponics equipment subsidiary Crystal Mountain expects to grow significantly as the business enters the retail market to supply equipment to micro-cultivators and new markets.

The company’s bio-manufacturing facility, acquired less than a year ago, was valued at $2.55 million on a May 1 transaction date and now has a balance sheet value of more than $16 million.

Last Wednesday THC Global reported the company’s Canada-based hydroponics equipment division Crystal Mountain was in the process of securing distribution agreements after expansions into Europe and the United Kingdom.

The group launched a share share purchase plan (SPP) on April 9, 2019 offering shareholders to apply for up to $15,000 worth of additional shares priced at 50 cents each.

THC Global flagged last Thursday the closing date for subscriptions is this Friday, April 26, 2019.

Shareholders on the company’s register on April 4, 2019 can take part in the offer. New shares are expected to be quoted on the Australian Securities Exchange on May 6, 2019.

THC Global said on Friday its directors and CEO had confirmed they would participate in the company's capital raising.

What are THC Global's financials?

THC Global’s revenues for the 2018 fiscal year grew $820,103, or 45%, to $2.7 million, when compared to the prior financial year — the 2017 fiscal year.

Cost of goods sold increased $838,433, or 79%, to $1.9 million in the 2018 fiscal year.

Gross profit declined by $18,330, or 2%, to $759,758 in 2018. Total comprehensive profit came in at $1.7 million for the year, a $4.3 million or 167% improvement on the $2.6 million total comprehensive loss of 2017.

The overall result was partly due to a $10.3 million gain on the revaluation of land and buildings, net of tax.

THC Global then ended 2018 with $6.3 million cash.

The company expected $2.2 million of expenses in the March quarter as it directed $638,000 to product manufacturing and operating costs.

THC Global's next quarterly report and corporate update is likely to be posted by April 30, 2019.

Inflection points

Regulatory approvals progress in Australia and Canada

Increased legitimacy and success of medicinal cannabis markets and ongoing investor support

Expansion of cannabidiol export markets to additional markets in Asian countries

Pharmaceutical industry mergers, acquisitions and strategic partnerships, related to THC Global and more broadly

Growth of Crystal Mountain and other subsidiaries in line with the emergence of newly-opened medicinal cannabis markets

Global group CEO Ken Charteris pleased with revenue-driving growth

“We are pleased to see our hydroponics equipment division continue to grow, particularly through our partnership strategy as we are able to expand our product offering and broaden our market reach – both of which are core drivers of revenue growth,” THC Global group CEO Ken Charteris said last Wednesday in a hydroponics equipment operations update.

Charteris had said in January the company had installed “first plants on site at our manufacturing and cultivation site, and look forward to commencing the first stage of our manufacturing activities to support the domestic market with a view to our larger facility being used to pursue export opportunities.”

 

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Tue, 23 Apr 2019 18:30:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218812/thc-global-group-progresses-core-drivers-of-revenue-growth-218812.html
<![CDATA[News - THC Global directors and CEO to participate in SPP ]]> https://www.proactiveinvestors.co.uk/companies/news/218806/thc-global-directors-and-ceo-to-participate-in-spp-218806.html THC Global Group Ltd (ASX:THC) has revealed that its directors and CEO have confirmed they will participate in the share purchase plan (SPP) that is underway.

Under the SPP, eligible shareholders can subscribe for up to $15,000 worth of shares priced at 50 cents.

The SPP offer is expected to close on Friday, 26 April 2019 after it opened 9 April 2019.

READ: THC Global's Canadian division boosts revenue 22% in March quarter

In a letter to shareholders on 9 April, THC’s chairman Steven Xu said: “The funds raised from the Share Purchase Plan will be applied to progress the company’s Australian medicinal cannabis activities as it transitions into full-scale production as final licences and permits are received in the near term, as well as general working capital.”

The company also released its April 2019 briefing note earlier this month, which it distributed to shareholders yesterday.

The briefing note highlighted the near term outlook for the company which included the receipt of final Australian cannabis licenses and permits enabling two manufacturing facilities and cultivation sites.

At its manufacturing facility, it is working towards first validation production, which aims to lead to high-value profitable production of up to 120,000 kilograms of oil at full capacity.

Furthermore, in the April briefing note, THC listed signing key offtake agreements for products and securing cannabis supply through domestic production in its near term outlook.

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Thu, 18 Apr 2019 11:11:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218806/thc-global-directors-and-ceo-to-participate-in-spp-218806.html
<![CDATA[News - THC Global's Canadian division boosts revenue 22% in March quarter ]]> https://www.proactiveinvestors.co.uk/companies/news/218732/thc-global-s-canadian-division-boosts-revenue-22-in-march-quarter-218732.html THC Global Group Ltd's (ASX:THC) Canadian hydroponics equipment division Crystal Mountain increased revenue in the March quarter primarily due to stronger sales in the lighting and lighting equipment product ranges.

Crystal Mountain grew revenue to $991,000, a 22% increase on the previous quarter. 

New distribution agreements

The division is also securing distribution agreements within Canada and has expanded into Europe and the United Kingdom.

READ: THC Global Group expands into Asia with partnership

As these distribution agreements are settled and products come on sale, the company expects to see stronger sales in these regions.

Expanded product range

Crystal Mountain has expanded its product range through distributing new products imported from partners across Canada, and soon internationally.

The division is also exploring new sales channels including online cannabis-focused offerings targeted to the micro-cultivator market, which is rapidly increasing in Canada.

THC Global chief executive officer Ken Charteris said: “We are pleased to see our hydroponics equipment division continue to grow, particularly through our partnership strategy as we are able to both expand our product offering and broaden our market reach - both of which are core drivers of revenue growth.”

READ: THC Global Group opens SPP and notes near term milestones

Earlier this month THC Global opened a share purchase plan offering shareholders to apply for up to $15,000 worth of additional shares at 50 cents each.

The company also released its April 2019 briefing note, which highlighted the near-term outlook for the company including the receipt of final Australian cannabis licenses and permits enabling two manufacturing facilities and cultivation sites.

Near-term outlook

It also listed signing key offtake agreements for products and securing cannabis supply through domestic production in its near-term outlook.

In addition to its core medicinal cannabis business, THC Global owns two Canadian companies - Crystal Mountain Products and Vertical Canna Inc.

Crystal Mountain is a revenue-generating global hydroponics retailer and distributor of equipment, material, and nutrients to cannabis growers and producers.

Vertical Canna is an investment vehicle through which THC Global intends to build, through acquisitions and strategic partnerships, a vertically integrated Canadian cannabis producer and retailer.

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Wed, 17 Apr 2019 13:52:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218732/thc-global-s-canadian-division-boosts-revenue-22-in-march-quarter-218732.html
<![CDATA[News - THC Global Group opens SPP and notes near term milestones ]]> https://www.proactiveinvestors.co.uk/companies/news/218272/thc-global-group-opens-spp-and-notes-near-term-milestones-218272.html THC Global Group Ltd (ASX:THC) yesterday opened its share purchase plan (SPP) offering shareholders to apply for up to $15,000 worth of additional shares priced at 50 cents each.

In a letter to shareholders, THC’s chairman Steven Xu said: “The funds raised from the Share Purchase Plan will be applied to progress the company’s Australian medicinal cannabis activities as it transitions into full-scale production as final licences and permits are received in the near term, as well as general working capital.”

The company also released its April 2019 briefing note, which it distributed to shareholders yesterday.

READ: THC Global Group expands into Asia with partnership

The briefing note highlighted the near term outlook for the company which included the receipt of final Australian cannabis licenses and permits enabling two manufacturing facilities and cultivation sites.

At its manufacturing facility, it is working towards first validation production, which aims to lead to high-value profitable production of up to 120,000 kilograms of oil at full capacity.

Furthermore, in the April briefing note, THC listed signing key offtake agreements for products and securing cannabis supply through domestic production in its near term outlook.

A global, diversified, vertically integrated cannabis company

THC Global is a diversified cannabis company with primary operations in Australia, New Zealand and Canada.

The company’s medicinal cannabis model is based on a vertically integrated ‘Farm-to-Pharma’ approach across research and development, cultivation and pharma-grade manufacturing.

THC Global also operates a hydroponics equipment business based in Canada servicing North America and Europe.

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Wed, 10 Apr 2019 08:34:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218272/thc-global-group-opens-spp-and-notes-near-term-milestones-218272.html
<![CDATA[News - THC Global Group launches SPP ahead of final licensing ]]> https://www.proactiveinvestors.co.uk/companies/news/218088/thc-global-group-launches-spp-ahead-of-final-licensing-218088.html THC Global Group Ltd (ASX:THC) has launched a share purchase plan (SPP) allowing shareholders to apply for up to $15,000 worth of shares priced at 50 cents.

The SPP opens tomorrow and will close on 26 April 2019.

The company sees the offer as an opportunity for shareholders to purchase discounted shares prior to the expected receipt of final licencing.

THC’s chairman Steven Xu said: “With this share purchase plan we are offering our loyal shareholders the opportunity to purchase shares at a discount to the current market price, in advance of the expected final licencing required to transition into full-scale medicinal cannabis production.”

READ: THC Global Group expands into Asia with partnership

Last Friday, THC secured a mutually exclusive partnership with Malaysian agri-tech company Heleogenics Sdn Bhd.

The deal represents a significant first step in the company’s Asian markets strategy.

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Mon, 08 Apr 2019 08:26:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218088/thc-global-group-launches-spp-ahead-of-final-licensing-218088.html
<![CDATA[News - THC Global Group expands into Asia with partnership ]]> https://www.proactiveinvestors.co.uk/companies/news/218012/thc-global-group-expands-into-asia-with-partnership-218012.html THC Global Group Ltd (ASX:THC) has secured a mutually exclusive partnership with Malaysian agri-tech company Heleogenics Sdn Bhd.

This represents a significant first step in the company’s Asian markets strategy.

The partnership with Heleogenics is initially to liaise with the Malaysian government towards the legalisation of medicinal cannabis in Malaysia.

The two will then explore other nations within Asia and the Middle East where there may be opportunities for THC Global to enter the medicinal cannabis market.

READ: THC Global acquires site in Canada for cannabis production

THC Global’s CEO Ken Charteris said: “Working with the Heleogenics team, who are leaders in the bio-tech and agri-tech sector within Asia brings a significant wealth of experience both within government liaison in addition to broadening the company’s research and development capabilities.

“In securing commercial partnerships with established businesses like Heleogenics within Asia, we are able to enter markets in an accelerated manner as soon as legislative changes are made, ensuring a first-to-market approach with significantly lower capital outlay than operating solely.”

Heleogenics is a valuable partner

Heleogenics is associated with Sengenics, a global medical bio-tech company primarily focussed on proteomics for medical diagnostics and the development of novel therapies.

Sengenics’s shareholders include SBI Holdings (SoftBank) and Insas Berhad.

The partnership will also encompass exploration of the significant agri-tech experience in plant genomics of Heleogenics, as well as THC’s expertise and IP in medicinal cannabis.

THC’s scope of activity in Asia includes developing patient access, doctor and patient engagement, off-take agreements and sales, R&D, and IP commercialisation.

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Fri, 05 Apr 2019 10:40:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218012/thc-global-group-expands-into-asia-with-partnership-218012.html
<![CDATA[News - THC Global acquires site in Canada for cannabis production ]]> https://www.proactiveinvestors.co.uk/companies/news/217174/thc-global-acquires-site-in-canada-for-cannabis-production-217174.html THC Global Group Ltd (ASX:THC) has completed the acquisition of a Canadian company in the process of becoming a licenced cultivator at a site in Nova Scotia, Canada.

THC Global intends to stage the development of the project with the first stage focussed on delivering profitability in the near term, with an expected 37,000 kilograms annual dried cannabis flower production volume.

Additional development will see both an increase in cultivation capacity as well as on-site processing capability to create value-added cannabis products for the Canadian market.

READ: THC Global’s focus on vertical integration is beginning to show dividends: The Green Fund

The current price of cannabis in Canada is C$7.12 per gram hence the company’s 37,000-kilogram annual production volume will be worth an expected C$273 million (about $287 million).

The proposed initial stage facility is expected to have a footprint of 20,000 square feet, however, the total size of the land acquired is about 4 acres allowing for significant scalability of THC Global’s operations at this location.

Negotiations for off-take agreements are also underway for both initial dried flower production and for proposed value-added manufacturing of cannabis into other products.

READ: THC Global grows 32% in 2018 after acquisitions and approvals

THC Global chief executive officer Ken Charteris said: “THC Global entering the Canadian cannabis market as a local producer is significant step in its global strategy.

“By identifying the right asset and securing the right team, we will now be able to enter this market with limited upfront capital outlay.

“The first stage of the project is targeted to deliver near term profitability, and we are already in negotiations to secure off-take agreements.

“The second stage development of the facility will add significant value to the company, allowing it to take advantage of lucrative business opportunities within the region.”

Purchase price

The acquisition price for 10034622 Canada Inc, the holding company for the Nova Scotia property and the applicant for the licenced cultivator status is in aggregate 450,000 shares in THC Global and C$200,000.

Securing expertise in Canada for cannabis business development

THC Global has appointed Jonathon Inkley, a construction and project management expert with significant experience in the Canadian cannabis sector as a director of Vertical Canna, THC Global’s Canadian subsidiary which has acquired 10034622 Canada Inc.

READ: THC Global Group progressing to full-scale domestic operations

THC Global also has an Australian cannabis facility in development in New South Wales, which when completed, will produce an additional 50,000 kilograms of dried cannabis flower.

Total production volume of dried cannabis flower only across THC Global’s three cultivation projects when completed and in production will be more than 88,000 kilograms per annum without considering new agricultural technologies.

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Tue, 26 Mar 2019 12:43:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/217174/thc-global-acquires-site-in-canada-for-cannabis-production-217174.html
<![CDATA[News - THC Global’s focus on vertical integration is beginning to show dividends: The Green Fund ]]> https://www.proactiveinvestors.co.uk/companies/news/216152/thc-globals-focus-on-vertical-integration-is-beginning-to-show-dividends-the-green-fund-216152.html THC Global Group Ltd (ASX:THC) is a medicinal cannabis producer with a vertically integrated business model and a farm-to-pharma strategy that aims to corner all aspects of the cannabis market.

Having secured both a significant cultivation capacity over two grow sites, and an industry-leading pharmaceuticals bio-manufacturing facility with attached testing and product development laboratory, THC is in prime position to service both domestic patients and the export market.

The following is an extract from an analyst report by The Green Fund, a global research house primarily focused on the cannabis industry:

THC operate a number of different subsidiaries, which have been structured to take advantage of their growing global strategy.

Canndeo

Canndeo is their Australian entity that has ODC-issued licenses and permits for both cultivation and Research & Development.

The permits are what separates THC from many of the other players who don’t have proper security cleared sites with suitable staff in order to be granted permits to commence cultivation/R&D under the respective licences.

THC Pharma and THC Pharma (NZ)

Then there is THC Pharma, their full-scale, Pharma-grade, extraction and research facility in Southport.

This state-of-the-art bio-flora extraction facility gives THC the ability to produce the highest purity, pharmaceutical-grade extracts.

Vertical Canna Inc.

Having legalised for adult recreational use in October last year, the Canadian recreational market has been booming.

There is a serious under-supply of legal recreational cannabis in Canada, and every Licensed Producer is producing as fast as it can to service this market.

THC Global has recognised this need and have launched their Canadian subsidiary, Vertical Canna Inc.

The company is gearing up to be a vertically-integrated Licensed Producer in the recreational, medicinal and nutraceutical markets that will also act as their investment entity for other vertically-integrated Canadian cannabis assets they may wish to acquire.

Crystal Mountain

And finally, they have Crystal Mountain, the company’s North American based hydroponics equipment and supplies retailer, and distributor.

This business subsidiary is already revenue generating and accounts for most of THC’s current revenue.

Many people forget about the ancillary market when they consider the cannabis industry, but there is much growth to be had in this area.

Vertical Integration

According to the CEO of THC Global, Ken Charteris, the company’s focus on vertical integration is beginning to show dividends as it transitions into manufacturing for the domestic market.

Charteris is a veteran of multiple biotech and pharmaceutical companies and clearly identifies with the issues facing the Australian medicinal market.

However, he is also quick to point out areas and changes that would drive escalation in patient growth and product demand.

Although THC has yet to finalise the growing permits for its’ NSW cultivation facility, the company’s international subsidiaries mean that it is one of the few Australian cannabis stocks that is currently turning a profit.

The jewel in the crown

It’s this fourth facility that potentially may have the greatest impact on the company’s fortunes in the short-term, particularly the next 24 months: their manufacturing plant and Validation Labs in Southport, Brisbane.

Although the facility is small, its’ output is anything but.

The cultivation plant is capable of producing up to 120,000 kilograms of oil per annum, while its’ ethanol based extraction facility, is built to cater to the extracts and concentrates market.

And it is clear as day how favourable we are on this sector.

The Bottom Line

Shares in THC Global reached an early high in 2018, hitting $1.00 a piece at the start of January.

However, the cannabis stock then proceeded to enter a year-long downward spiral before hitting an eventual low in December of $0.41.

The share price drop was caused in part by an industrywide decline that continued for much of 2018, as nervous investors abandoned their long position in favour of a staggered sell-off.

While this may seem like bad news for the cannabis manufacturer, the market appears to be generally bullish about the pot stock’s chances for 2019.

THC is expected to rebound on the back of future announcements from the company—such as further license approvals or international partnership agreements—which will likely cause a spike in share prices.

Disclaimer: This report is for general information purposes only. The Green Fund produced this report on behalf of the company described in this report and received fees on commercial terms for the production of this report.

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Mon, 11 Mar 2019 16:57:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/216152/thc-globals-focus-on-vertical-integration-is-beginning-to-show-dividends-the-green-fund-216152.html
<![CDATA[News - THC Global grows 32% in 2018 after acquisitions and approvals ]]> https://www.proactiveinvestors.co.uk/companies/news/215672/thc-global-grows-32-in-2018-after-acquisitions-and-approvals-215672.html THC Global Group Ltd (ASX:THC) (FRA:9TH) (OTCMKTS:HDRPF) specialises in medicinal cannabis supply and development and hydroponics equipment manufacturing and distribution. It was previously known as The Hydroponics Company Ltd and is run by Ken Charteris, group chief executive officer, with three decades experience in biotechnology and pharmaceutical company leadership.

He has managed companies with revenues of more than $200 million and asset bases of up to $500 million. Charteris is instrumental in executing the company’s strategic plan and is focused on acquisitions and alliances for the dual-listed group.

What does THC Global own?

THC Global is a rapidly growing company which went from having $1.1 million issued capital on January 1, 2017, to $23 million of issued capital on December 31 last year.

Growth in issued capital last year was $5.5 million or 32%.

The Australian company’s main pharmaceuticals focus is on the development and delivery of cannabidiol (CBD) products to the Australian and New Zealand markets, and the Canadian markets through wholly-owned subsidiary Vertical Canna Inc.

In November now-THC supplied Endoca CBD products to its first prescribed Australian patients.

The supply verified THC’s product pathway from manufacturer to patient under federal authorised prescriber and special access schemes and state regulations.

THC imports four products from Endoca’s range: Endoca’s CBD oil in 3% and 15% concentrations; and Endoca’s unique CBD-plus-CBDa oils, also in 3% and 15% concentrations.

The company is also exploring strategic opportunities in the Asian region.

It is transitioning into a full-scale domestic operation having secured most of the licensing and permitting approvals it needs to implement its farm-to-pharma business model.

THC has already begun cultivation activities having received permits for the cultivation and R&D site owned by its subsidiary Canndeo.

A manufacturing licence for this site is expected to facilitate product validation and study trial production.

On the group’s existing manufacturing front, a second core company activity is in the manufacture and distribution of hydroponics equipment, materials and nutrients.

Group CEO Ken Charteris is executing the company’s strategic vision and has advanced it over the past 2.5 years by driving the acquisition of THC’s existing manufacturing facility and securing commercial partnerships with Endoca (Europe) and Ascent Industries (North America).

THC Global’s hydroponics equipment subsidiary Crystal Mountain expects to grow significantly as the business enters the retail market to supply equipment to micro-cultivators and new markets.

The company’s bio-manufacturing facility, acquired less than a year ago, was valued at $2.55 million on a May 1 transaction date and now has a balance sheet value of more than $16 million.

THC’s revenues for the 2018 fiscal year grew $820,103, or 45%, to $2.7 million, when compared to the prior financial year — the 2017 fiscal year.

Cost of goods sold increased $838,433, or 79%, to $1.9 million in the 2018 fiscal year.

Gross profit declined by $18,330, or 2%, to $759,758 in 2018.

Total comprehensive profit came in at $1.7 million for the year, a $4.3 million or 167% improvement on the $2.6 million total comprehensive loss of 2017.

The overall result was partly due to a $10.3 million gain on the revaluation of land and buildings, net of tax.

THC expects $2.2 million of cash outflows in the March quarter as it directs $638,000 to product manufacturing and operating costs.

The company ended 2018 with $6.3 million cash.

Inflection points Regulatory approvals progress in Australia Increased legitimacy and success of medicinal cannabis markets and ongoing investor support Expansion of cannabidiol export markets to additional markets in Asian countries Pharmaceutical industry mergers, acquisitions and strategic partnerships, related to THC and more broadly Growth of subsidiary Crystal Mountain in line with the emergence of newly-opened medicinal cannabis grower markets Global group CEO Ken Charteris pleased with manufacturing progress

“Q4 2018 has been a pivotal quarter for the company focusing on developing a vertically-integrated global cannabis business and marking the company’s transition into production mode as its domestic facilities receive final licensing and permitting required,” THC Global group CEO Ken Charteris said in late January.

“We are pleased to see first plants on site at our manufacturing and cultivation site, and look forward to commencing the first stage of our manufacturing activities to support the domestic market with a view to our larger facility being used to pursue export opportunities.”

 

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Mon, 04 Mar 2019 16:30:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/215672/thc-global-grows-32-in-2018-after-acquisitions-and-approvals-215672.html
<![CDATA[News - THC Global Group progressing to full-scale domestic operations ]]> https://www.proactiveinvestors.co.uk/companies/news/213763/thc-global-group-progressing-to-full-scale-domestic-operations-213763.html THC Global Group Ltd (ASX:THC) is transitioning into a full-scale domestic operation having secured almost all licencing and permitting required for its farm-to-pharma business model.

The company has commenced cultivation activities having received permits for the cultivation and R&D site owned by subsidiary Canndeo.

A manufacturing licence for this site is expected shortly which will allow product validation and study trial production.

This will be in addition to the full-scale manufacturing that THC will undertake at its other manufacturing facility.

READ: THC Global appoints Mark Fortugno as CFO

THC Global’s CEO Ken Charteris said: “Q4 2018 has been a pivotal quarter for the company focussing on developing a vertically integrated global cannabis business and marking the company’s transition into production mode as its domestic facilities receive final licencing and permitting required.

“We are pleased to see first plants on site at our manufacturing and cultivation site, and look forward to commencing the first stage of our manufacturing activities to support the domestic market with a view to our larger facility being used to pursue export opportunities.”

READ: THC Global to exclusively import CBD products into New Zealand

During December 2018, the company expanded into New Zealand by securing exclusive rights to import cannabidiol (CBD) products into New Zealand.

The company’s expansion into Canada with its wholly owned subsidiary Vertical Canna Inc has also been successful.

Further expansion into Asia expected

It is also exploring strategic opportunities to the broader Asian region.

The company expects to reveal further details of these negotiations and early-stage partnerships as they develop towards commercial outcomes in the coming months.

Hydroponics equipment division expecting growth

THC Global’s hydroponics equipment division, Crystal Mountain, expects to grow significantly as the company enters the retail market to supply to micro-cultivators and other new markets.

The Crystal Mountain CEO, Jason Colquhoun has secured a number of new distribution agreements which will see distribution of Crystal Mountain’s trademarked products such as Spinpro to be distributed across the European Union commencing this March quarter.

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Fri, 01 Feb 2019 09:39:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/213763/thc-global-group-progressing-to-full-scale-domestic-operations-213763.html
<![CDATA[News - THC Global appoints Mark Fortugno as CFO ]]> https://www.proactiveinvestors.co.uk/companies/news/212540/thc-global-appoints-mark-fortugno-as-cfo-212540.html THC Global Group Ltd (ASX:THC) has appointed Mark Fortugno to replace Jarrod White as the company’s chief financial officer (CFO).

Fortugno has over 15 years of financial experience and is a Chartered Accountant (CA) in Australia and Canada, in addition to being a Certified Public Accountant in the US.

He has worked at KPMG (USA & Canada) in Cross Border Taxation, and as CFO for private-equity backed Cater Care in Australia

At Cater Care he was a part of its growth in headcount by 720% and revenues by 474% (to $237 million) within 5 years of his appointment.

Canadian experience relevant to growth strategy

Fortugno is a Canadian national and has significant financial management experience in Canada.

This will benefit THC Global as it grows its Canadian asset portfolio including a cannabis cultivation site in Nova Scotia, Canada to be completed shortly.

READ: THC Global shares rise after securing cannabis permits from the Office of Drug Control

THC Global’s CEO Ken Charteris said: “Mark’s specialisation in cross border transactions and implementation of high-growth strategies are a perfect mix for THC Global as we seek to aggressively expand into new regions and markets over the next 12 to 24 months in addition to transitioning into full-scale operations at our domestic cannabis production facilities.

“We look forward to working closely with him in an exciting new period of growth for THC Global.”

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Tue, 15 Jan 2019 11:17:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/212540/thc-global-appoints-mark-fortugno-as-cfo-212540.html
<![CDATA[News - THC Global shares rise after securing cannabis permits from the Office of Drug Control ]]> https://www.proactiveinvestors.co.uk/companies/news/211620/thc-global-shares-rise-after-securing-cannabis-permits-from-the-office-of-drug-control-211620.html THC Global Group Ltd’s (ASX:THC) wholly owned subsidiary Canndeo has received two Cannabis Permits from the Office of Drug Control (ODC) allowing the cultivation and production of THC’s proprietary high CBD (cannabidiol) strains at its Queensland growing and R&D facility.

The granting of these permits represents the next step in THC’s farm-to-pharma medicinal cannabis strategy as the company builds up cannabis plant supply for processing into cannabis oils and other medicinal cannabis products at its Australian manufacturing facility.

READ: THC Global Group completes name change from The Hydroponics Company Ltd

Further, the data gained through the research under the permits will assist in optimising yields and quality as THC pursues full-scale cultivation at its Australian growing facilities.

In addition to the permits granted by the ODC, THC has two separate manufacturing licence applications under review over two sites being the now ODC permitted growing and R&D facility, and the company’s large-scale manufacturing facility.

READ: The Hydroponics Company well placed to grow as Canada set to legalise recreational cannabis

THC chief executive officer Ken Charteris said: “The receipt of these permits is a critical step in progressing our Australian farm-to-pharma strategy and confirms expectations that THC Global will be in a position to commence full-scale production in the near term as one of the only Australian companies to have production ready facilities with licencing and permitting at an advanced stage.

“We also look forward to engaging our global commercial partners in further research and development activities on our proprietary strains as we seek to commercialise these assets in the near term.”

READ: THC Global to exclusively import CBD products into New Zealand

The successful granting of the permits provides security that THC’s operations, personnel, and procedures are acceptable to the ODC for a cannabis producing entity.

THC is in a unique position compared to almost all other participants in the domestic cannabis sector as it has fully built, production-ready facilities submitted for licencing and permitting that are able to be physically inspected by the ODC rather than seeking licencing for projects in the pre-construction phase that have multi-year build out.

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Fri, 21 Dec 2018 12:20:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/211620/thc-global-shares-rise-after-securing-cannabis-permits-from-the-office-of-drug-control-211620.html
<![CDATA[News - THC Global Group enters trading halt ahead of permit issue from Office of Drug Control ]]> https://www.proactiveinvestors.co.uk/companies/news/211445/thc-global-group-enters-trading-halt-ahead-of-permit-issue-from-office-of-drug-control-211445.html THC Global Group Ltd (ASX:THC) has been granted a trading halt by the ASX pending an announcement regarding the issue of permits to THC Global’s wholly-owned subsidiary Canndeo Ltd by the Department of Health’s Office of Drug Control.

The halt will remain in place until the earlier of December 21, 2018, or until an announcement is released to market.

READ: THC Global to exclusively import CBD products into New Zealand

THC Global operates under a ‘farm-to-pharma’ pharmaceutical model and is delivering medicinal cannabis products to Australian patients through existing access schemes.

Having secured significant growing capacity over two sites and an industry-leading pharmaceuticals biomanufacturing facility with testing and product development laboratory, THC Global is in prime position to service domestic and international patients.

The company’s commercial partners operate across four continents, supporting future international growth.

READ: THC Global makes move to acquire near-term Canadian cannabis producer

In addition to its core medicinal cannabis business, THC Global owns two Canadian companies, Crystal Mountain Products and Vertical Canna Inc.

Vancouver-based Crystal Mountain operates a revenue-generating global hydroponics retailer and distributor of equipment, material, and nutrients to cannabis growers and producers.

Vertical Canna is an investment vehicle through which THC Global intends to build, through acquisitions and strategic partnerships, a vertically integrated Canadian cannabis producer and retailer.

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Tue, 18 Dec 2018 21:05:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/211445/thc-global-group-enters-trading-halt-ahead-of-permit-issue-from-office-of-drug-control-211445.html
<![CDATA[News - THC Global to exclusively import CBD products into New Zealand ]]> https://www.proactiveinvestors.co.uk/companies/news/210077/thc-global-to-exclusively-import-cbd-products-into-new-zealand-210077.html THC Global Group Ltd (ASX:THC) has secured exclusive rights to import Endoca’s cannabidiol (CBD) products from Europe into New Zealand.

Furthermore, it has established a supply chain to patients through a strategic partnership with DATAPHARM.

THC Global has been advised by Endoca that they have received strong interest from over a thousand patients in New Zealand seeking their product.

READ: THC Global Group completes name change from The Hydroponics Company Ltd

THC Global’s CEO Ken Charteris said: “We look forward to our first orders in New Zealand in the coming weeks as we continue to expand our global footprint in the medicinal cannabis market, both in the Asia Pacific and in North America.

“The expansion into New Zealand represents the next step in the development of THC Global as a significant participant in the global medicinal cannabis market.”

Other cannabis-based medicine costs $14,000 per year

The only other MedSafe approved cannabis-based medication in New Zealand currently costs patients $14,000 per year.

THC Global anticipates supplying Endoca CBD products to New Zealand patients at a substantially lower price, addressing a major barrier to patient uptake, and increasing accessibility for patients.

Favourable regulatory conditions to support revenue growth

THC Global has identified New Zealand as an attractive market due to favourable regulatory conditions.

New Zealand regulations allow products with over 98% CBD such as the Endoca range to be prescribed by medical practitioners including GPs without the need for special authorisation as is required in Australia.

The company expects that this will result in rapid revenue generating sales as the company commences supply to patients in New Zealand.

The company’s operating subsidiary in New Zealand, THC Pharma (NZ) Limited will commence importing once permits are received, which are being sort on an expedited basis.

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Wed, 28 Nov 2018 13:10:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/210077/thc-global-to-exclusively-import-cbd-products-into-new-zealand-210077.html
<![CDATA[News - THC Global Group completes name change from The Hydroponics Company Ltd ]]> https://www.proactiveinvestors.co.uk/companies/news/209722/thc-global-group-completes-name-change-from-the-hydroponics-company-ltd-209722.html THC Global Group Limited (ASX:THC) has completed a change of name from The Hydroponics Company Ltd with the ticker remaining as THC.

The change was approved by shareholders at the company’s extraordinary general meeting on November 15, 2018.

This name was proposed as it was considered to better reflect the strategic developments in the business and the importance of advancing established global operations and international partnerships.

READ: THC Global Group makes move to acquire near-term Canadian cannabis producer

Directors also believed it recognised the significant value THC Global was now creating and into the future, across both medicinal and recreational cannabis markets.

Chief executive officer Ken Charteris said: “THC Global is preparing to enter new international markets and secure a stronghold as a full-scale global cannabis producer.

“The name change reflects our established operations, partnerships and alliances and our global expansion plans.

“We are particularly excited by the potential to increase our revenue generation in Canada in the coming months.”

‘Farm to Pharma’ model

THC Global operates under a ‘Farm to Pharma’ pharmaceutical model and is delivering medicinal cannabis products to Australian patients through existing access schemes.

Having secured significant growing capacity over two sites and an industry-leading pharmaceuticals biomanufacturing facility with testing and product development laboratory, THC Global is in prime position to service domestic and international patients.

READ: The Hydroponics Company supplies first Australian patients prescribed cannabidiol products

The company’s commercial partners operate across four continents, supporting future international growth.

THC Global believes the new name captures the growth objectives and direction for the company as a leading medicinal cannabis business with tier one growing and manufacturing capacity in Australia and ability to supply and expand internationally.

READ: The Hydroponics Company well placed to grow as Canada set to legalise recreational cannabis

In addition to its core medicinal cannabis business, THC Global owns two Canadian companies, Crystal Mountain Products and Vertical Canna Inc.

Vancouver-based Crystal Mountain operates a revenue-generating global hydroponics retailer and distributor of equipment, material, and nutrients to cannabis growers and producers.

Vertical Canna is an investment vehicle through which THC Global intends to build, through acquisitions and strategic partnerships, a vertically integrated Canadian cannabis producer and retailer.

The company said it would continue to expand its Crystal Mountain division and continue to accelerate the build-out of its medicinal cannabis growing and manufacturing facilities under its ‘Farm to Pharma’ model.

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Thu, 22 Nov 2018 14:13:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/209722/thc-global-group-completes-name-change-from-the-hydroponics-company-ltd-209722.html
<![CDATA[News - THC Global Group makes move to acquire near-term Canadian cannabis producer ]]> https://www.proactiveinvestors.co.uk/companies/news/209331/thc-global-group-makes-move-to-acquire-near-term-canadian-cannabis-producer-209331.html THC Global Group Ltd (ASX:THC) has entered into a binding agreement to conduct due diligence for the acquisition of a Canadian medicinal cannabis company.

The Canadian company is in the final stages of becoming a licenced producer of cannabis.

On acquisition, THC Global will complete the build-out of a full-scale cannabis growing facility which will be able to offer direct retail sales in addition to supporting other commercial sales.

This deal provides the opportunity for THC Global to own a full-scale cannabis growing facility in Canada in addition to its Australian facilities.

READ: The Hydroponics Company supplies first Australian patients prescribed cannabidiol products

THC Global’s CEO Ken Charteris said: “THC Global is looking at entering new international markets to further cement its presence as a full-scale global cannabis producer.

“Canada is a logical next step in the company’s global expansion plans given our existing Canadian presence with Crystal Mountain Products.

“Our focus in identifying new global opportunities will be to seek acquisition assets and strategic partnerships that lead to near-term revenue generation.

“Further, the opportunity to enter the retail sector in Canada in the coming months is very attractive and will offer deep synergies with our Crystal Mountain Products business and may lead to future supply opportunities from our existing Australian production facilities.”

Plans for vertically integrated cannabis business across North America

THC Global’s objective is to pursue a build out of a vertically integrated cannabis business across North America through its subsidiary Vertical Canna Inc.

It plans to do this through strategic acquisitions and partnerships with a focus on short paths to profitability with strong potential for value development.

In parallel to this strategy, Vertical Canna is currently developing a new retail cannabis and equipment brand which will soon be available across stores in Canada.

A high-growth cannabis business

The pursuit of a stronger presence in Canada is in response to positive feedback received from the Canadian capital markets and the broader cannabis sector towards THC Global.

THC Global is as a high-growth cannabis business with the capacity to produce large quantities of pharma-grade product in the near term.

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Fri, 16 Nov 2018 11:12:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/209331/thc-global-group-makes-move-to-acquire-near-term-canadian-cannabis-producer-209331.html