Valens GroWorks - VGW:CSE

On February 24, Valens reported its Q4/19 results for the period ended November 30, 2019.
Revenue for the quarter was $30.6 mm which was 12% ahead of our $27.2 mm estimate.
EBITDA was $17.7 mm (58% margin) compared to our forecast of $10.3 mm (38% margin).
The EBITDA beat was attributable to higher revenue and gross profit and lower G&A and
marketing expenses. Net income for the quarter was $4.5 mm ($0.04/share) compared to
our net income forecast of $2.9 mm ($0.02/share).
Details – VLNS Reports Strong Q4/19 Results – No Change To Our Thesis
White label manufacturing services should experience strong growth through our
forecast periods: In F2019, Valens’ initial focus was on the development of business to
business partnerships for custom extraction processing of cannabis and hemp biomass.
However, in Q4/19, this shifted to more product development and white label services with
both licensed and non-licensed partners. In Q4/19, white label product development
initiatives contributed to record revenues as new and existing customers pushed to roll out
Cannabis 2.0 oil-based products into the market. Margins in Q4/19 remained strong,
however management expects margins to contract in the coming quarters as it builds out
our infrastructure to execute on our strategic shift towards becoming a next generation
product company which offers increased opportunity and greater EBITDA per input gram.
For F2020, we forecast the white label products will make up approximately 30-40% of total
revenue.
The Valens Company to export first international white label products to Australia: On
February 20, Valens announced its first international shipments of white label products
to customers in Australia. Based on the purchase orders received, the initial shipments will
consist of three SKUs of tinctures, totaling over 3,000 units, and are expected to be shipped
in Q2/20, pending receipt of necessary import and export permits.
Balance Sheet Remains Strong: At the end of Q4/19 the company had cash and short-term
investments of approximately $58.7 mm. This strong financial position will allow the
company to increase extraction capacity at its Kelowna facility, to build out the recently
acquired adjacent property which will add additional post-processing, product
development and white label capacity, and for general corporate purposes.
IMPACT – Maintain BUY and $8.00 Target
We are maintaining our BUY recommendation on Valens with an $8.00 target. To arrive
at our $8.00 target price, we applied a 12x EV/EBITDA multiple to new 2021 estimate.

Australis Capital Announces Termination of Merger Agreement with Folium Biosciences
Australis Capital Inc. (CNW Group/Australis Capital Inc.)
NEWS PROVIDED BY

Australis Capital Inc.
Feb 18, 2020, 13:00 ET

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LAS VEGAS, Feb. 18, 2020 /PRNewswire/ - Australis Capital Inc. (CSE: AUSA) (OTC: AUSAF) ("AUSA" or the "Company") previously announced on, December 11, 2019, a proposed merger by and among AUSA, Folium Equity Holding LLC ("Folium") and Folium Merger Sub, LLC by which Folium would become a wholly owned subsidiary of AUSA, and AUSA would be rebranded as and carry on the business of Folium. AUSA recently discovered new relevant information with regard to Folium and, on that basis, AUSA has decided to not proceed with the merger.

"AUSA continues to lean heavily on corporate governance and our vision to navigate through an incredibly unpredictable market over the past 12 months," states Scott Dowty, CEO of AUSA. "With over $38.2 million in cash, liquid assets, and other assets that can easily be converted into cash within a short amount of time and $5.2 million annual burn excluding charges from capital projects and one-time occurrence, AUSA has a very strong financial position. With 18 months of operating experience behind us, we are excited about the future and eager to execute on our strategy starting with our corporate update on February 26, 2020."

A trading halt on AUSA stock was issued in accordance with the policies of the Canadian Stock Exchange ("CSE") at the time of the announcement of the proposed merger agreement. As the transaction will not proceed, trading is expected to resume on the CSE and OTC shortly.

AUSA is hosting a corporate update call at 1:00 PM EST on Wednesday, February 26, 2020. The conference call may be accessed by dialing 1.888.396.8064 (Toll-Free North America) or 1.416.764.8649 (Canada).

About Australis Capital Inc.
AUSA operates and builds transformative, differentiated cannabis companies predominantly in the United States, a highly-regulated, fragmented, and rapidly expanding industry. AUSA adheres to stringent evaluation and operating criteria focusing on high-quality opportunities while maintaining a steadfast commitment to governance and community. AUSA's Board and management team have material experience with, and knowledge of, the cannabis space in the U.S., extensive backgrounds in highly-regulated industries and regulatory compliance. AUSA operating and portfolio assets include Rthm Technologies Inc., Body and Mind Inc., Quality Green Inc., Mr. Natural Inc., Green Therapeutics, LLC., and Cocoon Technology LLC.

The Company's Common shares trade on the CSE under the symbol "AUSA" and on the OTCQX under the symbol "AUSAF".

For further information about AUSA, please visit the website at ausa-corp.com or contact the Company by e-mail at This email address is being protected from spambots. You need JavaScript enabled to view it..

ON BEHALF OF THE BOARD OF DIRECTORS

"Scott Dowty"

________________________________
Scott Dowty
Chief Executive Officer

Folium is doing a RTO into AUSA:CSE which is currently halted. AUSA is where Aurora parks its U.S. assets. I fortunately got into Valens at just over a buck a share, made a nice gain, and still hold 10,000 free shares. AUSA, through Folium, could have similar or better results depending on the RTO structure.

stock has a nice rally

The Globe and Mail reports in its Wednesday, Jan. 22, edition that M Partners analyst Paul Piotrowski says Valens Groworks ($3.88) is "built to lead Cannabis 2.0." The Globe's David Leeder writes in the Eye On Equities column that Mr. Piotrowski began coverage on Valens with a "buy" rating and $7.80 share target. Analysts on average target the shares at $8.56. Mr. Piotrowski says in a note: "VLNS runs a very high margin business model and is one of the few profitable cannabis companies. ... Valens continues to trade at a discount to its peers, while in our view being the best equipped to succeed in Cannabis 2.0. Valens trades at 6.2 times 2020 [earnings before interest, taxes, depreciation and amortization] vs. peers at 16.5 times 2020 EBITDA. We believe the discount is unwarranted as Valens has consistently reported strong revenue growth and margins and is the only cannabis company in Canada generating free cash flow. As Valens continues to report strong quarters, shares should rerate closer to its peers." The Globe reported on Nov. 8, 2019, that Desjardins Securities analyst John Chu had commenced coverage on Valens with a "buy" rating and $8 share target. The shares could then be had for $3.15.

Valens establishes operations in The Greater Toronto Area with the acquisition of a leading beverage company

Canada NewsWire

KELOWNA, BC, Nov. 11, 2019

Valens acquires Pommies Cider Co., a leading Ontario-based beverage company and mature micro-processing license applicant for total consideration of C$7.5 million, subject to achieving certain milestones

Acquisition accelerates Valens' commercial-scale entry into the high-growth beverages and edibles market in Canada, a C$2.0 billion+ market according to Deloitte1

Acquisition also expands Valens' extraction capabilities into Eastern Canada and adds additional white label product offerings to address the continued acceleration of demand for the Company's products and services

Valens adds beverage industry veterans Nick and Lindsay Sutcliffe to be key contributors to the Company's beverage strategy

Valens believes that cannabis-infused beverages will be one of the most profitable product lines based on overwhelming interest from existing customers and other ongoing discussions

KELOWNA, BC, Nov. 11, 2019 /CNW/ - Valens GroWorks Corp. (TSXV: VGW) (OTCQX: VGWCF) (the "Company" or "Valens"), a vertically integrated provider of industry leading extraction products and services, including a diverse suite of extraction methodologies, next generation cannabinoid delivery formats and an ISO 17025 accredited analytical lab, is pleased to announce that it has acquired all of the issued and outstanding shares of Southern Cliff Brands Inc. (d/b/a Pommies Cider Co.) ("Pommies") in a cash and stock deal (the "Acquisition"). The Acquisition and all planned capital expenditures are fully funded with cash on hand and current and projected cash flow from operations.

Very significant


Valens Becomes First Third Party Processor to Enter Strategic Agreement with Shoppers Drug Mart to Supply Cannabis Oil Products

KELOWNA, BC, Sept. 16, 2019 /PRNewswire/ - Valens GroWorks Corp. (TSXV: VGW) (OTC: VGWCF) (the "Company" or "Valens"), a vertically integrated provider of industry leading extraction products and services; including a diverse suite of extraction methodologies, next generation cannabinoid delivery formats and an ISO 17025 accredited analytical lab is pleased to announce that it has entered into an agreement to supply cannabis oil derivative products to Medical Cannabis by Shoppers, the online medical cannabis ecommerce site of one of Canada's most trusted pharmacy retailers.

The stock has held up well while most of the sector has tanked

Gambler, was wondering why nobody talking about it here, another great pick from Ron. This was in the Globe a couple weeks back

The Globe and Mail reports in its Friday edition that Haywood Securities analyst Neal Gilmer says Valens Groworks is "positioned to be a leader in the extraction services market." The Globe's David Leeder writes that Mr. Gilmer began coverage of the Kelowna-based cannabis producer and processor with a "buy" rating. He targets the shares at $5.25, 75 cents above the consensus. Mr. Gilmer says in a note: "The company has significant current production capacity that is expanding towards 150,000 kilograms annually. Not only is the company set-up for extraction processing into crude oil, it also has the ability to further refine these extracted products for various oil derivative products that are expected to be approved for the market later this year. We are of the opinion that the extraction services market and development of oil derivative based products will become an important aspect of the cannabis landscape. Valens's primary driver of revenues will be toll processing in the near-term, followed by expanding to white-label products and its own branded products towards the end of 2019. As the market evolves towards consumer-packaged goods (CPGs) we view extraction services as a key aspect of the marketplace."

stock is breaking out

Valens Groworks, Tilray enter extraction service deal

2019-02-26 17:18 ET - News Release


Mr. Tyler Robson reports

VALENS SIGNS MULTI-YEAR CANNABIS AND HEMP EXTRACTION AGREEMENT WITH TILRAY

Valens Groworks Corp. has entered into a multiyear extraction service agreement, renewable annually after the initial two-year term, to provide cannabis and hemp extraction services to Tilray Canada Ltd., a global leader in cannabis research, cultivation, production and distribution.

Under the terms of the Agreement, Valens will extract a minimum annual quantity of 15,000kg of dried cannabis and hemp. The Company will receive and process the cannabis and hemp on a fee for service basis into crude, distillate or other cannabis oil derivatives as required by Tilray before bulk shipping the desired product back to Tilray for final processing and sale.

"Partnering with Tilray to support their existing and emergent product offerings marks another milestone for Valens," says Tyler Robson, CEO of Valens Groworks Corp. "We take pride in our proprietary extraction processes and are honoured our best in class extraction capabilities have been recognized by Tilray, a pioneer in the global cannabis market, which we believe is a testament to the quality and reliability of our services."

Valens GroWorks Capitalizing on the Cannabis Extracts and Products Surge in Canada -- CFN Media

SEATTLE, Wash., May 31, 2018 (GLOBE NEWSWIRE) -- CFN Media Group (“CFN Media”), the leading agency and financial media network dedicated to the North American cannabis industry, announces publication of an article covering Valens GroWorks Corp. (CSE:VGW) (VGW.CN) (CNSX:VGW), a multi-licensed company, based in the Okanagan Valley of British Columbia, that recognizes the trend in the Canadian cannabis industry toward oils and derivatives and is uniquely positioned to capitalize on it. Valens is covering all of the bases, with a late-stage licensed producer application pending; two dealers licenses that allow for research, cultivation, and product development; high volume extraction capability; and a distribution deal in place with Canopy Growth Corporation.

As the cannabis industry matures throughout North America and across the globe, some trends are solidifying in terms of the preferred method of intake. Notably, smoking cannabis flower is becoming less prevalent while the use of extracts and oils (and products based on those) is on the rise. With Canada on the verge of legalizing cannabis for adult-use, the country is sort of a test case for market dynamics. The most recent data released by Health Canada shows sales of cannabis oil on par with dried marijuana as of April 2017, but exceeding dried sales by almost 50% as of December 2017.

The Valens Licenses and Facilities

Valens GroWorks consists of three subsidiary companies. The first, wholly-owned Valens Agritech Limited, holds a dealers license from Health Canada that allows for cannabis cultivation, processing, oil production, and sales of those oils through licensed producers. Currently housed in a 17,000 square foot cultivation and research center, the company is in the late stages of its application to become an ACMPR licensed producer as well.

Valens AgriTech utilizes state-of-the-art CO2 extraction equipment that efficiently yields pure extracts with minimal post-processing requirements. With the recent addition of two more extraction machines, the company can now process 6,500 kg/month of cannabis raw material. The oils produced in the process can initially be sold through Valens’ agreement with Canopy Growth, offering near-term revenue while the company expands its operations and develops its own distribution networks. Alongside the revenue opportunity, Valens’ presence in Canopy’s CraftGrow distribution network allows the company to develop early brand recognition. This is especially important in the early stages of recreational legalization.

Valens AgriTech recently completed its own first harvest with tremendous results. Growing a strain of cannabis expected to yield 18-19% THC content, the company reported crops yielding about 24% THC. The company credits its Master Growers’ expertise, advanced growing facility, and overall commitment to providing credible products, and the results show great promise as the foundation for creating premium oil-based products.

The second wholly-owned subsidiary, Supra THC Services, also holds a dealer’s license from Health Canada, though this one is a bit different. Supra doesn’t cultivate its own cannabis, but offers commercial testing and analytical services. Supra recently moved into the Valens AgriTech facility, which is in the process of being GMP-certified. This certification is important, because with it (and the appropriate export licenses) the company would be able to sell its products in even the most demanding regulatory environments.

Supra offers testing and analytical services to individuals and licensed producers, offering another near-term revenue source. As the cannabis industry expands, and in light of a number of pesticide-based product recalls in Canada, the need for accurate third-party testing is great now and will only grow in the future. In a further indication of Valens’ commitment to quality science, the company has also teamed with research and laboratory giant ThermoFisher Scientific to create a Centre of Excellence for Plant Based Medicine Analytics in the Valens facility.

The third wholly-owned subsidiary, Valens Farms, was recently formed to commercially produce premium quality cannabis. The company recently entered into a partnership with Kosha Projects Inc. The companies have broken ground on a 400,000 sf cannabis production facility in Armstrong, BC. The city has already approved the construction of around 850,000 sf, giving Valens Farms room to expand even further should the need arise. When it’s all said and done, the two companies will each have a 50% interest in the subsidiary.

The Bigger Picture

All of the pieces fit nicely into the Valens puzzle, comprising a company that offers a more complete picture than many more well-known cannabis enterprises. Valens’ ultimate goal is to extract and sell its own premium cannabis and cannabis-derived products sourced from cultivation facilities that they own, operate or partner with to ensure the product is consistent and of superior quality. The receipt from Health Canada of the license to produce, and the subsequent license to sell, is certainly key in allowing Valens to control all aspects of its vertically integrated operation. But even prior, the company is in a unique position to capitalize on the booming Canadian (and even international) cannabis industry.

Through its licensed subsidiaries, Valens can cultivate its own cannabis to fuel research and development of products. These products can be developed internally, or on behalf of third parties like licensed producers, pharmacies, and natural health companies. Examples of cannabis-derived products, some of which have yet to be legalized in Canada, include edibles, beverages, personal care products, and nutraceuticals.

Valens is currently extracting pure cannabis oils for research to perfect its own products (upwards of 20 types) that could then be sold initially through the extensive CraftGrow network, including tweedmainstreet.com, and through other distribution channels as the company develops them. Valens currently has 100 kilos of extract on site, giving the company plenty of raw material for the scientific development and validation of its formulations prior to hitting the market.

Meanwhile, the company is establishing itself as a leader in lab services and analytics. Near-term revenue streams like this are invaluable to Valens as it looks to establish its brand and expand operations, potentially decreasing the need to raise money along the way. As it stands now, the company has sufficient funds to move forward with its business plan and has no plans for financing in the near future. Keep an eye out for future developments as there are plenty of potential catalysts on the Valens GroWorks horizon.

Please follow the link to read the full article: www.cannabisfn.com/valens-groworks-capit...oducts-surge-canada/

About CFN Media

Big Money alert: finance.yahoo.com/news/valens-groworks-a...board-231800611.html

Something big seems to be happening with this one. I picked up some (but was cut back) on a recent private placement @ $1.40 and bought a fair bit more at $2.25 after being cut back. It was slowly climbing on thin volume but now the volume has started to pick up and the daily price increases have jumped. There are some big bids (one bid for 100,000 shares @ $2.65 for example) as support.

About Valens GroWorks Corp.

Valens GroWorks is Canadian publicly traded biotechnology company executing on its “plants to premium products” objectives through two wholly-owned subsidiaries, located at the Company’s expanding 17,000 sq.ft. facility on two acres in Kelowna, in the heart of British Columbia’s Okanagan Valley. Subsidiary Valens Agritech (“VAL”) is commencing cannabis production and sales under a Health Canada Dealer’s License, and is also a late-stage license applicant to cultivate medical marijuana under the ACMPR for individual patients. Subsidiary Supra THC Services (“Supra”) is a Health Canada licensed cannabis testing lab providing sector-leading analytical and proprietary services to Licensed Producers, ACMPR patients, and the natural health products industry.

Supra has partnered with Thermo Fisher Scientific to develop a “Centre of Excellence in Plant Based Medicine Analytics” in Kelowna, and both subsidiaries are involved in a collaborative research partnership with British Columbia-based universities UBC Okanagan and Thompson Rivers to explore the vast range of bioproducts that can be made from cannabis plant materials. A supply and sales agreement with Canopy Growth Corporation (TSX: WEED) provides for the distribution, marketing and sale of a portion of the Company’s branded products through Canopy Growth’s extensive CraftGrow distribution network. For more information, please visit http:/valensgroworks.com, www.valensagritech.com and www.suprathc.ca .