The Supreme Cannabis Company, Inc. (TSXV:FIRE) (OTCQX:SPRWF) announced record revenues for the first quarter of 2019, showing an increase of approximately 230 percent since this time last year. For the quarter ending September 30, the company saw revenues of 5.14 million Canadian dollars ($3.9 million), which was a 45 percent increase over the previous quarter.
Other highlights of the report included an upgrade to the OTCQX market in the United States and a capital raise of CA$100 million ($76 million) via a bought deal of convertible debentures last month.
According to management, branding is fueling the company’s record numbers. With a motto of “We Grow Better,” Supreme Cannabis signed supply agreements with nearly every Canadian province for the newly legalized recreational market in Canada. Although cannabis is legal nationwide in Canada, each province governs legalization for its region.
"Supreme Cannabis' results in the first quarter mark a solid beginning to a historic year in a competitive, dynamic and rapidly evolving marketplace," said Navdeep Dhaliwal, CEO of Supreme Cannabis in a statement. "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.
The flagship brand of Supreme Cannabis
7ACRES is the flagship brand of the Supreme Cannabis portfolio. A wholly-owned subsidiary, it’s a Canadian Licensed Producer of cannabis. The company has an impressive 342,000-square-foot facility in Kincardine, Ontario, and has experienced tremendous brand success, according to management fueled mainly by provincial supply agreements.
The company recently made its first shipments of 7ACRES branded High-End Cannabis to British Columbia, Alberta, Manitoba, Ontario, Nova Scotia, and Prince Edward Island.
“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,” said Dhaliwal in a statement. “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."
Strategic partnerships also help
Another factor fueling Supreme’s record revenue is its strategic partnership with Tilray (NASDAQ:TLRY). The two companies signed several supply agreements that in total are worth over $14 million.
Supreme Cannabis also has an eye on the global market. The company has an equity investment as well as a long-term global distribution partnership with Lesotho-based Medigrow for exports of medical-grade cannabis oil.
Dhaliwal will present Supreme Cannabis’ strategic plan at the December 10 shareholder meeting.
The Supreme Cannabis company was up 3.6 percent in trading on Thursday afternoon on the TSX, showing a slight gain of CA$0.06 ($0.045) per share.