Midas Letter

BlissCo Cannabis Corp (CNSX:BLIS) (OTCMKTS:HSTRF) (FRA:GQ4B) CEO Damian Kettlewell shares samples of the company’s recyclable packaging made from materials such as milk jugs and ocean waste. Kettlewell explains that the company receives its dried flower license in November and is currently selling dried flower and prerolls. BlissCo expects to be selling a high CBD cannabis oil, a balanced CBD/THC oil product, and a high THC oil in the summer. BlissCo has a supply agreement with Supreme Cannabis Company Inc (TSE:FIRE) (OTCMKTS:SPRWF) (FRA:53S1), which also has a minority stake in BlissCo. Kettlewell highlights that by producing its own brands, BlissCo differs from other leading extractors in the space, such as MediPharm Labs Corp (CVE:LABS) (OTCMKTS:MEDIF) (FRA:MLZ) and Valens GroWorks Corp (CNSX:VGW) (OTCMKTS:VGWCF) (

MediPharm Labs Corp (CVE:LABS) (OTCMKTS:MEDIF) (FRA:MLZ) President Keith Strachan has nothing but praise for the MediPharm team in light of the company’s recent financial reporting. MediPharm recently released its Q4 financials for the period ending December 31, 2018 and the results were impressive. The company reported revenue of $10.2 million and adjusted EBITDA of $2.1 million. The pure play extractor has partnerships with Canopy Growth Corp (TSE:WEED) (NYSE:CGC) (FRA:11L1) and Supreme Cannabis Company Inc (TSE:FIRE) (OTCMKTS:SPRWF) (FRA:53S1). MediPharm Labs is strictly a B2B company and Strachan explains that its private label approach provides a turnkey model for established brands to enter the cannabis space. While price competition in the extraction space is a concern, Strachan believes the company’s turnkey offerings, in addition to MediPharm’s specialized end products and secure supply chain, will offset any commodity pricing in the space.

Narrator: Founded in 2015, MediPharm Labs produces pharmaceutical-grade cannabis oil, using downstream secondary extraction methodology, distillation and cannabinoid isolation and purification.

MediPharm Labs provides B2B contract processing of cannabis to Canadian authorized

World Class Extractions Inc (CNSX:PUMP) is a US-based industrial scale hemp and cannabis extractor. Founder Anthony Durkacz provides an overview of the company and shares his thoughts on the rapidly scaling US hemp space. Durkacz discusses why so many farmers are making the switch to growing hemp and why the switch is not without risk. World Class has built two alpha systems that will be operational at the company’s facilities in North Carolina in May. World Class will both be creating its own branded products as well as employing a toll model. Durkacz highlights the advantages of the toll model and notes Valens GroWorks Corp (CNSX:VGW) (OTCMKTS:VGWCF) (FRA:7LV) has used this royalty-generating method to great effect. Durkacz is not worried about the price of extracted material in the short term, as there is not sufficient capacity to meet demands currently. However, he stresses that product manufacturers and distributors will ultimately generate the most revenue.

James West:   And I’m joined now by the founder of Worldwide Extracts, Anthony Durkacz. Anthony, welcome back.

Anthony Durkacz:   Thank you. It’s World Class Extracts.

Newstrike Brands Ltd (CVE:HIP) (OTCMKTS:NWKRF) (FRA:0N8) CEO Jay Wilgar shows viewers the company’s Lincoln, Ontario greenhouse facilities, which are home to Up Cannabis, a licensed producer and Newstrike subsidiary. Up Cannabis is building its brand through music and made waves when it partnered with Canadian rock legends The Tragically Hip. The band’s music informs every step of the growing process at Up Cannabis. Bassist Gord Sinclair helped name Up Cannabis strains such as “Moon” while other strains like “Meridian” and “50” reference The Hip’s extensive song catalogue. The band’s music is played in the company’s greenhouses and Wilgar explains the beneficial effect music has on plant growth. The company’s Brantford facility is expected to produce 2,000 kilos of dried flower annually while its Lincoln greenhouse will produce 40,000 kilos each year. From cultivation to packaging, Newstrike is a top-tier producer and viewers get a look at that expertise with a tour of the company’s extraction room. Working within Canada’s restrictive advertising regulations, Newstrike is creating alternative products, such as soaps and cosmetics that contain parts of the cannabis plant but not THC and CBD, to build Up Cannabis brand awareness.

Jay Wilgar, CEO:   This is one of the most unique partnerships, I think, you could get. You’re bringing together one of the most iconic groups of Canadians in history with what is one of the most exciting times in business in Canada. So bringing the two together here at Up Cannabis was certainly very exciting.

Biome Grow Inc (CNSX:BIO) (OTCMKTS:BIOIF) (FRA:6OTA) CEO Khurram Malik is thrilled with the way the company’s products have sold since being commercially released in Canada in January. Malik emphasizes the company’s regulatory knowledge and indicates Biome is interested in expanding to Asian and African markets where the company can leverage its expertise to help craft new laws and regulatory frameworks. Malik discusses Biome’s recent deal with CBD Acres for 20,000 kilograms annually of hemp-grown, high-quality, low-cost CBD extract. The deal allows Biome to export CBD products to international markets. Malik notes that Canada produces some of the lowest-cost hemp in the world and explains the company’s proprietary harvesting methods.

Narrator: Biome Grow, Incorporated is a Canadian-based cannabis company with national and international business interests. Biome owns five subsidiaries, including the Back Home Medical Cannabis Corporation in Newfoundland and Labrador; Great Lakes Cannabis in Ontario; Highland Grow, Inc. in Nova Scotia; Red Sands Craft Cannabis Company in Prince Edward Island; and Weed Virtual Retail, Inc., a company in Ontario which operates a new virtual reality technology platform focused on the medical and recreational cannabis markets.

Biome Grow, Incorporated is headquartered in Toronto and trades on the Canadian Securities Exchange under the ticker symbol BIO.

Harvest One Cannabis Inc (CVE:HVT) (OTCMKTS:HRVOF) (FRA:2CN) CEO Grant Froese believes the company’s portfolio sets it apart from its industry competitors. Harvest One products are available in 30,000 stores in North America. Harvest One’s Satipharm branded products are now available at Shoppers Drug Mart. Satipharm products join the company’s Dream Water and Delivra brands, which already feature in the pharmacy chain. The company has partnered with major US retailers like Kroger and Walmart US to distribute Dream Water, a sleep aide. Forese emphasizes that consumers already recognize Harvest One’s brands, which will be an advantage once the company’s CBD products are introduced. Harvest One has developed a CBD product for epilepsy that had an 82 percent success rate in clinical trials. The product is sold in Europe, Australia, and most recently Asia under the company’s Satipharm brand.

Narrator: Harvest One is a global cannabis company that develops and provides lifestyle and wellness products to consumers and patients in regulated markets around the world. The company’s range of lifestyle solutions is designed to enhance quality of life.

Shareholders have significant exposure to the entire value chain through three wholly owned subsidiaries: United Greeneries, a licensed producer; Satipharm, medical and nutraceutical, and Dream Water Global, consumer; and a minority interest in Burb Cannabis, a retail operation.

Harvest One trades on the TSX Venture under the symbol HVT.

Hill Street Beverage Company Inc (CVE:BEER) (OTCMKTS:HSEEF) CEO Terry Donnelly is ecstatic about the company’s first quarter. Hill Street’s Q1 reporting showed the company’s revenue was up 100 percent YOY and the company is tracking 35 percent annual revenue growth for 2019. Donnelly discusses how Hill Street has used its line of non-alcoholic beer and wine to drive its brand recognition ahead of the legalization of infused beverages in the fall. Donnelly explains how Hill Street uses partner Lexaria Bioscience Corp’s (CNSX:LXX) DehydraTECH to create infused beverages. The technology allows for 5 to 10 percent greater availability of THC and ensures consumers feel the beverage’s full effect in 15 minutes. Donnelly suggests that this allows consumers to luxuriate over infused beverages in the same way they do with alcoholic beverages. Hill Street is the most awarded alcohol-free beverage company in the world and plans to be ready for legalization in the fall.

Narrator: Hill Street Beverage Company makes alcohol-free beer, wine, and adult format beverages. The company’s products include Hill Street Craft Brewed Lager, Designated Draft alcohol-free beer, Vin(Zero) wines, and VinTense wines. Hill Street also produces and sells cannabis-infused adult beverages as soon as the sale of cannabis edibles becomes legal in Canada in October 2019.

Hill Street has licensed a patented infusion technology from Lexaria Bioscience, which infuses cannabis into beverages to mimic the onset and duration effects of alcohol.

Hill Street Beverage Company is listed on the TSX Venture under the symbol BEER.

Midas Letter Lead Financial Writer Ben Smith dissects what CannTrust Holdings Inc’s (TSE:TRST) (NYSE:CTST) (FRA:C9S) recent financial reporting means for the company and the cannabis space more broadly. Smith notes that CannTrust typically hits its targets and had been trading near recent highs. As a result, the news that CannTrust missed its targets acted like a “bombshell to the market.” Smith cautions investors to pay attention to the news flow in the sector and not just individual names. In addition to CannTrust’s missed revenues, there have also been four downgrades in recent weeks, including Cronos Group Inc (TSE:CRON) (NASDAQ:CRON) (FRA:7CI). Smith emphasizes that the current cannabis news cycle is not conducive to multiple expansions in the sector. Smith also addresses the SAFE Banking Act, which would reform banking laws in the United States and would make it easier for US MSOs to access capital. While the legislation has made it through committee, Smith feels it is highly unlikely to be passed before Q4 2019.

Howard Glassman:   Benjamin, you were just talking about CannTrust earnings hitting the stock hard. It’s – what are your thoughts, because I know a lot of people are waiting to hear what you have to say about this.

Benjamin Smith:    Yeah, so CannTrust earnings, I think, delivered a little bit of a bombshell to the market, just because investors aren’t used to CannTrust missing. Traditionally, they’re, you know, one of the best-performing stocks companies in terms of financial reporting; they usually hit their numbers, they usually do pretty well. I think the last financial report, Q3, that came out in November, they absolutely hit it out of the park, and even though the market had been trending down and had been, you know, in the heart of the post-legalization selling, CannTrust, you know, was up double digits that day on a percentage basis.

So this came as a little bit of a surprise, especially if you look at the char

Fire & Flower Holdings Corp (CVE:FAF) (OTCMKTS:FFLWF) CEO Trevor Fencott is thrilled by the success of the company’s Fire & Flower York Street Cannabis store opening on April 1 in Ottawa. Fencott reveals the Fire & Flower branded shop, located in Ottawa’s Byward Market, made $50,000 in systems sales on its first day. Fencott estimates that just half of the province’s 25 retail shops opened at the start of April. The company’s Fire & Flower branded Kingston location had a soft-opening on April 1 and will be open to the public within a week of Ontario’s private retail store launch. Fencott also provides an update on the company’s retail operations in Western Canada. He notes that private retailers are allowed to have e-commerce platforms and offer delivery in Saskatchewan and he believes such ancillary models could be successfully applied to other provinces.

Narrator: Fire and Flower is a cannabis retail franchise with provincial licenses to operate seven cannabis retail stores in Alberta, two cannabis retail stores in Saskatchewan, as well as the wholesale cannabis supply business.

The company is currently pursuing additional licenses to operate stores in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario.

Fire and Flower stores recently surpassed $10 million in sales since legalization. The company had five locations open on October 17th, and has since doubled its retail footprint.

Fire and Flower began trading on the TSX Venture today under the ticker symbol FAF.

James West:   Animation. Trevor Fencott is here with me now. He’s the CEO of Fire a

SLANG Worldwide (CNSX:SLNG) (OTCMKTS:SLGWF) (FRA:84S) CEO Peter Miller is thrilled to have been named by High Times as one of the 100 most influential people in the cannabis industry for 2019. Miller discusses his personal history in the cannabis space and explains why SLANG has not adopted the industry’s popular vertical integration strategy. Miller explains that SLANG is a consumer packaged goods company and believes CPGs represent a normalization of cannabis and substantial growth opportunities. SLANG recently partnered with Florida-based Trulieve Cannabis Corp (CNSX:TRUL) (OTCMKTS:TCNNF) to distribute SLANG’s portfolio of products in Trulieve’s dispensaries. Miller explains that the partnership grants SLANG access to the lucrative Florida market without having to invest significant capital to build infrastructure in the state.

Howard Glassman:   All right, this is going to be interesting. Please help me welcome to the program, the CEO of SLANG Worldwide, and when you see him on camera for the first time, you’re going to think, wait a second, did Peter Miller send his kid? Look at this boy! Look at this nice boy!

Peter Miller: My kid is at home, hopefully watching this on the internet in a couple of hours.