Supreme Cannabis Company Inc (TSXV: FIRE) (OTCQX: SPRWF) (FRA: 53S1) recently got a boost after reporting record revenues in Q1 2019 with sales of $5.14 million, a 229% increase from Q1 2018 ($1.56 million) and a 45% increase from the previous quarter ($3.55 million).
Supreme Cannabis has made a number of big moves; the Company signed several supply agreements with other Licensed Producers, including supply agreements with Tilray which are estimated to be in excess of $14 million. Supreme Cannabis added 50,000 square feet of licensed flowering room capacity, bringing estimated potential production to 13,333 kg. In less than twelve months, the Company has added 80,000 square feet of licensed flowering room capacity. Supreme Cannabis also recently upgraded to the OTCQX and signed agreements to supply adult-use cannabis to consumers in six Canadian provinces.
Supreme Cannabis is a licensed producer in Canada trading on the TSX Venture Exchange under the ticker “FIRE”. Supreme produces and sells cannabis through its wholly-owned subsidiary 7ACRES, a federally licensed producer of cannabis operating inside a 342,000-square-foot facility in Kincardine, Ontario. 7ACRES is dedicated to providing consumers with a premium-quality product that recognizes its customers are informed, discerning and value a brand and culture that aligns with their principles. 7ACRES brand success has been reflected in provincial supply agreements, where 7ACRES’ product is consistently listed in the highest brand category available to recreational consumers.
The Company’s growing portfolio also includes an equity investment and long-term global distribution partnership with Lesotho-based Medigrow for the exporting of medical-grade cannabis oil. Supreme Cannabis is led by serial entrepreneur Navdeep Dhaliwal who stated on Q1 2019 results:
“Supreme Cannabis’ results in the first quarter mark a solid beginning to a historic year in a competitive, dynamic and rapidly evolving marketplace. Q1 2019 results are continued validation for the successful execution of our strategy for our 7ACRES business to establish a competitive advantage in quality driven regulated cultivation at scale. We’ve established valuable intellectual property and laid a strong foundation for 2019 by amassing coast-to-coast distribution for what we believe is the only premium High-End Cannabis™ grown at scale in the country. Moving forward, our branding and distribution for 7ACRES will accelerate, as we’re confident that consumers will further fuel our growth as they recognize the standard 7ACRES has set in the market for premium dried flower.”
Last month Supreme Cannabis completed its bought deal offering for gross proceeds of $100 million, including the exercise in full of the underwriters’ over-allotment option comprised of 6.0% senior unsecured convertible debentures of Supreme Cannabis at the issue price of $1,000 per Debenture, with a syndicate of underwriters, co-led by GMP Securities L.P. and BMO Capital Markets. The Company intends to use the net proceeds of the Offering for the construction and development of its existing and planned facilities in Canada. This includes the Company’s facility in Kincardine, Ontario under construction and the development and construction of a facility on land purchased by the Company that is situated adjacent to such facility. The Debentures commenced trading on the TSX under the stock symbol FIRE.DB on October 23, 2018.
Currently trading at a $311 million market valuation Supreme Cannabis has $31 million in cash, manageable debt and just reported revenues in Q1 2019 of $5.14 million, a 229% increase from Q1 2018. The Company is focused on becoming a leading premium brand in the Canadian recreational market and has been making all the right moves securing several supply agreements with other Licensed Producers, including supply agreements with Tilray which are estimated to be in excess of $14 million. Supreme Cannabis added 50,000 square feet of licensed flowering room capacity, bringing estimated potential production to 13,333 kg.
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Disclosure: we hold no position in Supreme Cannabis either long or short and we have not been compensated for this article.