HOPE, BC, April 25, 2019 /CNW/ - VIVO Cannabis Inc. (TSX-V: VIVO, OTCQB: VVCIF) ("VIVO" or the "Company") today announced its wholly-owned subsidiary, Canna Farms Limited ("Canna Farms"), has received local municipal approval for its Phase 5 expansion which will add an incremental 2,500 kilograms of indoor capacity to its facility in Hope, B.C.
Canna Farms' Phase 5 expansion, originally slated to begin construction in 2020, is now expected to be completed in late 2019 or early 2020, pending regulatory approval. The expansion consists of 10,000 square feet of cultivation space, with expected capital costs of $3.5 million and is expected to bring VIVO's total internal production capacity to 13,500 kilograms by early 2020.
"Canna Farms is a cultivator and purveyor of premium quality, award winning, small-batch craft cannabis with widespread recognition and appeal as evidenced by its award for 'Top Reviewed Licensed Producer of the Year' at the 2018 Canadian Cannabis Awards," said Barry Fishman, Chief Executive Officer of VIVO. "This expansion will further increase Canna Farms' production capacity to help meet the significant market demand for premium B.C. dry bud. This project represents a strategic deployment of a minor portion of our strong cash position as the Company continues to invest to drive future growth."
"This capital project was not expected to start so quickly as it required development permit approval from the District of Hope," said Raymond Laflamme, Senior Vice President, Facilities and Engineering at VIVO. "In short order we will have completed the design and engineering work needed for our building permit application. As in our previous facility expansions, we will continue to utilize off-the-shelf components that are efficient, easy to assemble, and locally sourced. Using this approach allows Canna Farms to minimize construction time and achieve a quick return on capital for our shareholders."
Mr. Fishman added, "VIVO is committed to producing premium quality products with strong and sustainable gross margins. VIVO's cultivation strategy includes premium indoor cultivation of dry flower as well as the more cost-effective seasonal greenhouse and outdoor cultivation of cannabis for extraction."
About VIVO Cannabis™
VIVO, based in Napanee, Ontario, is recognized for trusted, high-quality products and services. It holds production and sales licences from Health Canada and operates world-class indoor cultivation facilities with proprietary plant-growing technology. VIVO has a collection of premium brands targeting unique customer segments, including Beacon Medical™, FIRESIDE™, Canna Farms™ and Lumina™. In August 2018, VIVO acquired Canna Farms, a premium cannabis company based in Hope, British Columbia. Canna Farms was B.C.'s first Licensed Producer and has several years of craft cultivation experience and expertise, as well as a significant patient base and positive cash flow. The Company is significantly expanding its production capacity and pursuing partnership and product development opportunities domestically, as well as in select international markets, including Germany and Australia. VIVO also operates Harvest Medicine, a patient-centric and highly scalable network of specialty medical cannabis clinics as well as a free telemedicine service. VIVO has a healthy balance sheet and is well-positioned to accelerate its growth in Canada and internationally.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Disclaimer for Forward-Looking Statements
This news release contains forward-looking statements, which are statements that are not purely historical, regarding the beliefs, plans, expectations or intentions of the Company and its management regarding the future, and should not be read as guarantees of future performance or results. Forward looking statements in this news release include statements regarding: the Company's expected increase in production capacity from the Canna Farms expansion; the Company's expected 2020 production capacity; and the expected timing of completion and capital costs of the expansion. Such statements are based on certain assumptions of management, including that all necessary regulatory approvals for the expansion will be received in a timely manner and that there will be no occurrences that decrease expected production or increase expected capital costs, and are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the forward-looking statements, including potential delays in regulatory approval, completion of construction and producing saleable finished products; failure to obtain necessary regulatory approvals; changes in applicable laws; and other factors beyond the Company's control. A more complete discussion of the risks and uncertainties facing the Company appears in the Company's Annual Information Form for the year ended December 31, 2017 and other continuous disclosure filings, which are available on SEDAR at www.sedar.com. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this news release. The Company disclaims any intention or obligation to update or revise any forward-looking statements as a result of new information or future events, or for any other reason, other than as required by applicable securities laws.
SOURCE VIVO Cannabis Inc.
For further information: VIVO Investor Relations, Heidi Christensen Brown, +1.416.848.1389, [email protected], NATIONAL Capital Markets; Michael Bumby, Chief Financial Officer, [email protected], VIVO Cannabis Inc.