Ventura Cannabis (VCAN) Announces Completion of California Manufacturing and Distribution Center
LOS ANGELES, April 9, 2020 (GLOBAL NEWSWIRE)– Ventura Cannabis and Wellness Corp. (CSE:VCAN) (“Ventura Cannabis”, “VCAN”, or the “Company”) is pleased to announce it has secured all necessary steps to launch its California THC vaping product, including regulatory approvals and a manufacturing and distribution location in Santa Rosa, California.
The first THC vaping product will be available for sale as early as June 2020. Ventura is now a fully integrated California vaping product company with the ability to expand into the edible, pre-roll and extraction market if the opportunity presents itself. Management is currently reviewing sales and marketing options in an effort to balance the investment in revenue growth against cash flow burn.
The disposition of the addiction business is nearly complete. Most of the assets have been sold, collected or liquidated. There remain several liabilities that Management is working to resolve this quarter and Management continues to believe the total amount of proceeds, as announced on October 10th, 2019, from the disposition of the business units will be positive.
“While I am pleased we have accomplished our goal of becoming a vertically integrated California cannabis product company, we are assessing the trade off between revenue growth and cash burn. As most of our shareholders and market participants know, because of US federal tax laws, namely 280(e), it is nearly impossible to generate cash flow from a cannabis operation. Therefore, the funding that drives any serious revenue growth in any cannabis company continues to be from capital markets rather than internally generated cash flow or debt. As we are no different, we will focus on operating our business primarily with an eye to minimize losses and preserve cash until the capital markets re-open to our industry where we can refocus on growth.”
“The good news is that we are debt free and have a decent balance sheet to sustain us until that time,” continued Mr. Heath. “We are nearly done with disposing our addiction businesses. As with any disposition, the liabilities in the process are significant, however, our hope remains to collect more than we spent in the process. We will be far better off financially having disposed of the addiction business units, rather than if we kept them, given the current economic conditions.”
As a note, the recently enacted federal (U.S.) legislation to support small business does not apply to cannabis-related businesses as they continue to be prohibited under U.S. federal law and therefore, on an enterprise level, the Company expects to burn cash quarterly.
For more information contact:
Ventura Cannabis and Wellness Corp.
Certain statements contained in this presentation constitute “forward-looking information” as such term is defined in applicable Canadian securities legislation. The words “may”, “would”, “could”, “should”, “potential”, “will”, “seek”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect”, “confident” and similar expressions as they relate to the Company. Such statements reflect the Company’s current views and intentions with respect to future events, and current information available to the Company, and are subject to certain risks, uncertainties, and assumptions. The forward-looking information included are made as of April 9 2020, and the Company undertakes no obligation to publicly update or revise any forward-looking information, other than as required by applicable law. VCAN holds or is acquiring marijuana assets in the United States. Previously disclosed acquisitions are still subject to closing. Marijuana is legal in each state VCAN is looking to operate, however marijuana remains illegal under US federal law, and the approach to enforcement of US federal law against marijuana is subject to change. Shareholders and investors need to be aware that adverse enforcement actions could affect their investments and that VCAN’s ability to access private and public capital could be affected and or could not be available to support continuing operations.