The Pure Sunfarms facility in British Columbia has secured Health Canada approval to begin selling cannabis directly to provincial and territorial distributors across the country.
Pure Sunfarms is a 50/50 joint venture owned by Village Farms International, Inc.
The facility already sells to other licensed producers, but it can now ship dried cannabis to provincial and territorial wholesalers thanks to Health Canada’s decision to amend its license.
It already has deals in place to supply the Ontario Cannabis Store and the British Columbia Liquor Distribution Branch. It will begin selling directly to both distributors in the coming weeks.
Ontario and British Columbia account for more than half of Canada’s population between them.
“Pure Sunfarms has already established itself as a premiere supplier of cannabis products to other licensed producers and with this amendment it can now begin building a differentiated and enduring brand based on its best-in-class, low-cost growing operations with Canadian consumers,” said Michael DeGiglio, chief executive Village Farms International.
He added that Pure Sunfarms can achieve industry-leading gross margins, and that the ability to sell direct to provinces will position it for continued revenue growth and increased profitability in the years ahead.
The plan now is to target other provincial distributors in an effort to tie up supply deals.
Village Farms International came under attack from a Citron Research short earlier this year, and Emerald Therapeutics was also caught in the crossfire. Both companies saw sharp decreases to their share prices in the aftermath, but Village Farms quickly rallied.
VFF began the year at $4.78 and it opened at $16.32 today. It closed at $15.66 on Friday and the Pure Sunfarms news has given it a boost.
Emerald Health’s share price has continued to decrease throughout 2019 and it is now down by more than 50% since the Citron Research report was published. However, it also saw its price increase this morning after the Pure Sunfarms news was revealed.
However, it saw net loss improve significantly in Q2 2019 after sales increased 94% on the previous quarter. It believes its stake in Pure Sunfarms leaves it well placed for strong financial growth in the year ahead, while it has ramped up its focus on higher-value brands to drive increased margins.
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