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New York NY – December 6, 2018 – Since embarking upon adult-recreational legalization last July, the state of Nevada continues to break its own cannabis sales records. Nevada’s successes point to an intriguing potential should the federal government move closer to national legalization, which would benefit cannabis companies inside and out of the state, including Green Growth Brands (CSE:GGB), Medmen Enterprises Inc. (CSE:MMEN) (OTC:MMNFF), HEXO Corp. (TSX:HEXO) (OTC:HYYDF), CV Sciences, Inc. (OTC:CVSI), and Green Thumb Industries Inc. (CSE:GTII) (OTC:GTBIF).
The Nevada Department of Taxation reported that its intake of taxes from cannabis sales more than doubled year-over-year in August. Marijuana tax collection alone for 2019 in Nevada is expected to be nearly $70 million.
Much of the state’s increases in cannabis-related revenues can be attributed to improved successes at the retail level. Leaders in the industry have seized upon pot’s growing popularity in Nevada. Led by a team of retail heavyweights, Green Growth Brands (CSE: GGB) recently ramped up its Nevada footprint assuming full ownership of The Source NV’s Henderson, NV location and the acquisition of a secondary grow facility in Parhrump, NV.
“Nevada will always hold a special place in our company history,” said Green Growth Brands (CSE: GGB) CEO Peter Horvath. “We opened our first two stores in the state and have been exceptionally pleased with the performance of the whole value chain here. These additional facilities and licenses will give us the ability to expand our operations and provide an even better marijuana retail experience for consumers.”
“We were impressed with the regulatory process in Nevada and feel that these new licenses reflect the confidence officials have in Green Growth Brands and our ability to operate high quality, compliant and safe dispensaries,” continued Horvath. “Working with regulators organically through this process allows us to avoid the higher costs associated with acquiring existing licenses and facilities, helping us preserve our balance sheet strength.”
Nevada regulators are actively assisting the blossoming industry, through assurances including quality control. The state is host to approximately ten cannabis labs, used to test products for any residues of pesticides, heavy metal contamination, or microbial contamination. Customers buying cannabis in Nevada can be assured that the products they are about to consume have been evaluated for their safety.
The net benefit to Nevadans goes beyond an increased intake of taxes, and safe products, but also a rise in jobs worth having.
Nevada Leading the Way for the Country
There are several signs that the country as a whole is on a path towards full-scale legalization. In fact, the last few months have been nothing but hints that the green wave is about to go full-scale.
After the most recent US election, there are now 10 states as well as Washington, DC, that have legalized marijuana for recreational purposes. Even ultra-conservative Utah voted for full legalization.
Almost immediately after the results were announced, vehemently anti-cannabis Jeff Sessions was asked to step down as US Attorney General. Now most recently, US lawmakers finally struck a deal for the landmark 2018 Farm Bill, ending months of partisan debate and kicking off a new era of hemp-derived cannabinoid markets.
Once enacted, the bill effectively legalizes hemp growing for the first time in nearly a century. The shift opens up the possibilities for the production of the non-psychoactive cannabinoid, cannabidiol (CBD), which is quickly gaining in popularity for its proposed anti-anxiety, and anti-inflammation properties.
CBD’s market potential has already been projected to reach $22 billion by 2022. The mainstream potential for CBD products is possibly higher in the long run than CBD’s more notorious cannabinoid cousin, tetrahydrocannabinol (THC).
Over the long term, the CBD market is projected to offer a compound annual growth rate of 147% through 2022. Versatility is CBD’s strongest factor, given that it can be incorporated into oils, capsules, vapes, infused beverages, edibles, and pretty much any alternative form of consumption you can think of.
Ahead of the Farm Bill’s announcement, Green Growth Brands (CSE: GGB) established its first-mover advantage in the CBD space with its brand, Seventh Sense.
Seventh Sense is a unique line of CBD-infused beauty products. Green Growth Brands (CSE: GGB) aims to have the brand on shelves in all types of retail locations including drug stores, grocery stores, and the company’s own chain of stores dubbed The Source NV.
Backed by a team of some of the top minds in the entire retail sector, Green Growth Brands (CSE: GGB) is preparing for green revolution by taking each legalized market by storm. The company’s Nevada expansions came on the heels of its other recent announcement, regarding its entry into the Massachusetts market.
Leading a Marijuana Retail Revolution
Since raising $140 million prior to its RTO less than two months ago, Green Growth Brands (CSE: GGB) has engaged in a series of aggressive expansion plans. But before the company even began trading, expectations were on the company to storm out of the gate, and establish authentic brands and innovative stores.
Prior to its RTO, there was plenty of excitement over Green Growth Brands’ positive contributions to the sector, coming from its fully-qualified retail team while entering the sector.
During the lead-up to Green Growth Brands’ first trading day, CEO Peter Horvath gave an interview with CNBC’s Mad Money host Jim Cramer. The host was exceedingly excited about Horvath’s retail experience, stating, “This is the first CEO that’s going into retail that’s actually been in retail.”
Before going to commercial, Cramer just had to add, “I cannot wait until you come public.”
Many cannabis customers have been underwhelmed with the cannabis retail experience. The sector’s initial dispensaries and their excuse of newness is wearing thin. Thankfully expert help is on the way, both for buyers, and producers/suppliers. This is where groups like Green Growth Brands (CSE: GGB) are filling a void, and taking the cannabis shopping experience to a whole new level.
“The team we’ve put together is arguably one of the top retail teams in any market, let alone cannabis,” Horvath told Cramer in the CNBC interview.
Horvath and his team have held prominent roles and led the strategy teams that built up the #1 lingerie business in the world (Victoria’s Secret), the #1 personal care products business in the world (Bath & Body Works), the #1 denim business in North America (American Eagle Outfitters), and the #1 shoe specialty business in North America (DSW).
Across all Green Growth Brands’ (CSE: GGB) offerings, there appears to be something for everyone—These include an outdoorsy/active living niche of its CAMP brand, a self-care botanical therapy products called Seventh Sense, a surf culture Meri + Jayne brand, feminine targeted Green Lily botanical products, the newly-acquired Just Healthy line, and its flagship dispensary subsidiary called The Source NV.
Horvath and his team have developed a unique branding strategy that’s moving away from traditional customer demographics. The team is instead choosing to strategize it’s segmenting by emotion. For example, Meri + Jayne focuses on combining the feeling of fun and well-being, while CAMP focuses on the experience of being at one with nature.
Among the company’s assets is state-of-the-art, patent-pending developer brand Xanthic Biopharma. Through this subsidiary, Green Growth Brands (CSE: GGB) controls a proprietary process to make THC and CBD water soluble. With water-soluble cannabinoids at the ready, the company gains a seemingly limitless potential to develop new products, from beauty products to edibles and drinks.
As the US moves towards a more liberalized view of marijuana, more markets are opening up for groups like Green Growth Brands (CSE: GGB). The example given by Nevada is a promising look at what could be to come across the entire country in the coming years.
Further Cannabis Developments
Despite a spat of losses due to an aggressive expansion plan, Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) recently reported an impressive 1,094% gain in sales for its Q1 fiscal period. MedMen now operates over 14 stores in California, Nevada, and New York, as well as cultivation and production sites. The company continued its territorial expansion into six key markets, after closing the acquisition of its Treadwell Nursery in Florida. Sometimes described as the “Apple Store of pot”, MedMen is targeting an improvement of the cannabis retail space, much like Green Growth Brands (CSE: GGB). Both retailers are specializing in offering their own house brands developed through a strategy of diverse vertical integration.
A major brewing company in Molson Coors has recently stepped into the cannabis arena, through a deal with HEXO Corp. (TSX: HEXO) (OTCPK: HYYDF). Arguably much smaller than the Canopy deal, the Molson Coors deal has sparked HEXO into motion, having since announced plans to increase its 310,000 sq ft cannabis cultivation space to almost 1 million sq ft by the end of the year. The JV, which goes by the name Truss, will be led by former Molson Coors executive Brett Vye in the CEO seat and will report to the Truss board which consists of three MCC members, and 2 HEXO members.
Multistate marijuana company, Green Thumb Industries Inc. (CSE: GTII) (OTCQX: GTBIF) recently expanded its footprint in Nevada. Green Thumb Industries acquired a Nevada-based vertically integrated cannabis company in a stock and cash deal valued at approximately $290 million. The deal included three retail stores in the Las Vegas Valley, a 54,000 sq ft cultivation and processing facility, and another 41,000 sq ft cultivation and processing facility. The company has eight manufacturing facilities and licenses for 60 retail locations across eight US markets.
Henderson, Nevada-based life-science company CV Sciences, Inc. (OTCQB: CVSI) continues to be a top performer, through developing CBD-based pharmaceuticals and consumer products. CVSI’s consumer product division focuses on manufacturing, marketing and selling plant-based CBD products under its PlusCBD brand. Thanks to recent indications of the passing of the new Farm Bill, CVSI is recovering from a report regarding the company’s patents cooled off the stock months ago. The company seems to have weathered the storm, and their sales continue to grow, including a 143% increase in gross profit from Q3 2017 to Q3 2018.
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