WeedMD Inc. (TSXV:WMD) (OTC:WDDMF) announced its financial results for the three and nine months ended September 30, highlighting huge percentage gains in revenues. The Company reported revenues of $2 million for the last quarter, which equated to a year-over-year increase of 461 percent. In the first nine months of fiscal 2018, they reported revenues of $5.2 million, which represents a 784 percent increase compared to the same period in 2017.
Other corporate highlights in the announcement included news of their first product shipments to companies with which they have supply agreements, including the Ontario Cannabis Store, Alberta Gaming, Liquor & Cannabis Commission, British Columbia Liquor Distribution Branch, and Novia Scotia Liquor Corporation. Additionally, since October 17, when marijuana was legalized in Canada, they delivered their first shipments of WeedMD-branded cannabis for recreational use.
Keeping up with increasing demand in Canada
WeedMD currently operates a 70,000 square foot growing facility in Strathroy, and in the last quarter, WeedMD completed their first harvest there. They attained a license from Health Canada to sell the cannabis from this greenhouse and to transport the cannabis to its nearby indoor facility in Aylmer.
Nichola Thompson, Interim CFO of WeedMD, commented on the company’s vision for expansion, including plans for cultivation facilities.
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“Through strategic additions to our highly experienced management team, we strengthened our production, sales, marketing, and business development capabilities,” said Thompson in a statement. “Our fully-funded path to more than 500,000 square feet of high-quality, cost-effective cultivation footprint provides us with significant advantages to capitalize on a tight cannabis supply market at the onset of the Canadian adult-use market.”
The company is also now exporting their product to other countries. One of which is to Medifarm, an Australian-based licensed producer which is known as the first company licensed to produce medical cannabis for therapeutic use in Australia. Secondly, they have completed shipments to Israel’s Pharmocann, a pharma-agricultural medical cannabis producer that complies with Israel’s Ministry of Health.
“We are exploring opportunities to expand internationally, including having recently supplied our industry-leading cannabis genetics to Israel’s Pharmocann and Australia’s Medifarm,” said Keith Merker, CEO of WeedMD in a statement. “As the cannabis industry evolves into increasingly differentiated, high-margin product offerings across the medical and adult-use segments, WeedMD has positioned itself to take full advantage of market opportunities in Canada and internationally.”
Stock prices remain flat
Despite the good news, the stock was down 2.1 percent on the TSXV Exchange and 0.94 percent in the OTC market from Wednesday to Thursday close. In the past month, the stock price has remained flat and generally has followed the North American Index, represented by the Horizons Marijuana Life Sciences ETF (TSX:HMMJ) (OTC:HMLSF), throughout the month.
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Still, as expected, management was pleased with the revenue increases and attributed it to the expansion of their greenhouse space.
“The third quarter was another strong growth period for WeedMD,” said Thompson in her statement. “We increased revenues by more than 450 [percent] compared to the prior year and rapidly ramped up production capacity at our state-of-the-art hybrid greenhouse.”