Mercanto Secures Key Listings in Quebec's New Vape Category

MONTREAL, July 7, 2025 /CNW/ - Mercanto Holdings Inc. (TSX-V: MUSH) ("Mercanto" or the "Company") is pleased to announce that it has received preliminary acceptance from the Quebec cannabis authority for three vape cartridge products under its Velada and Nordique Royale brands. This marks a significant milestone as Quebec prepares to launch its vape category — the last major provincial market in Canada to do so.

Positioned at the Forefront of Canada's Last Cannabis Gold Rush

Mercanto's approved products include:

• Cherry Blossom: A high-CBD and moderate-THC vape cartridge available in all retail stores across Quebec.
• Afghan Gold: A potent formulation featuring high THC and moderate CBD mirroring the Company's popular hash and hash-infused pre-roll. This SKU will also be available in all stores.
• Peach Sumo: A high-CBD vape offered online through the Quebec cannabis authority's e-commerce platform.

With only 25 vape cartridges approved for retail stores province-wide at launch, Mercanto will hold 8% of the physical shelf space, and with 30 SKUs approved for online sales, it will command 10% of that segment. While this does not necessarily equate to 8-10% of sales, as product velocity will ultimately determine market share, it is a strong starting point that underscores the trust Mercanto has built as a supplier in Quebec over the past three years.

"This is an important stepping stone for Mercanto and the culmination of our experience in Quebec," said Eric Ronsse, CEO. "Vape cartridges represent the last true gold rush in Canadian cannabis. With no entrenched incumbents in Quebec, we are as well positioned as any competitor, starting on equal footing in a market with enormous potential."

Preliminary Acceptance & Next Steps

While this acceptance is preliminary and conditional upon final reviews of packaging and the cartridges themselves by the Quebec cannabis authority, Mercanto does not anticipate any hurdles that would prevent these products from proceeding to full launch.

Market Opportunity & Timing

The Quebec cannabis authority projects that vape products will account for 11% of total cannabis sales within the first year of launch, approximately $68 million annually, with roughly 50% of this volume expected to be incremental to the market. In comparison, vape cartridges comprise about 15% of total sales in Alberta, Ontario, and British Columbia.

Mercanto's vape cartridges are expected to launch across all 105 retail stores and online in November 2025 (Q2 fiscal 2026), alongside the two authorized batteries for the category, one of which the Company will supply. This synchronized rollout means Mercanto enters Quebec's vape segment with a holistic strategy: providing not only cartridges but also the essential hardware to support the entire category.

"For the first time, we're entering a new category where no player holds an advantage. This levels the field and lets quality and execution speak. While our products won't be the cheapest on the shelf, and we expect to be mid-tier in pricing, they are crafted with a focus on quality, balanced formulations, and consumer experience. We're confident that's where the long-term value lies," added Ronsse.

Elimination of Nursery Program Supports Scale

In addition, the Quebec cannabis authority will eliminate its nursery program this October. Previously, new products were tested in roughly 25% of stores for six months before either expanding to full distribution or being delisted. Going forward, approved SKUs will be placed directly into all stores, which benefits established, trusted suppliers like Mercanto. One factor that remains unknown, however, is how frequently products will be reviewed for potential delisting and how long they will typically remain on shelves before such reviews occur. The Company currently has four products in the nursery phase and expects clarity on their status in the coming months.

Outlook

Mercanto believes this launch marks the beginning of a new growth chapter. With a resilient, cash-focused model and a reputation built over years of consistent supply to the Quebec cannabis authority, the Company sees the vape rollout as a catalyst that could materially impact future revenues.

For More Information:

Eric Ronsse
President & CEO, Mercanto Holdings Inc.

https://www.mercantoholdings.com/

Email: [email protected]

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Forward-Looking Information Disclaimer:

This press release contains forward-looking information within the meaning of applicable Canadian securities legislation. Forward-looking information typically contains statements with words such as "anticipate," "believe," "expect," "plan," "intend," "estimate," "may," "will," "should," "potential," "proposed," or similar expressions. Forward-looking statements in this document include, but are not limited to, statements regarding Mercanto Holdings Inc.'s future business plans, operations, growth potential, market conditions, product launches, and financial outlook. These statements are subject to known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking information. Except as required by law, the Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

SOURCE Mercanto Holdings Inc.