Highlights:
- Phase 1 Indoor Cultivation expansion and upgrades underway: forecast additional $6.1 million in annual revenues
- Phase 2 Indoor Cultivation construction and expansion to commence in Q3: forecast additional $10.9 million in annual revenues
- Phase 1 CapEx: $1.7M USD via existing balance sheet
- Phase 2 CapEx: $4.0M USD via existing balance sheet or project-based loan
Sacramento, California--(Newsfile Corp. - June 24, 2021) - Vibe Growth Corporation (CSE: VIBE) (OTC Pink: VBSCF) (FSE: A061) (the "Company" or "Vibe"), a leading vertically integrated multi-state cannabis enterprise, provides update on the expansion of its Sacramento Cannabis Campus.
The Company has prioritized the expansion of its Sacramento cultivation capacity to meet the increased demand for Vibe products, implementing a proven vertical integration strategy to significantly enhance its brands' margin profile. Cultivation expansion remains a top growth priority, having significantly improved its growing efficiencies translating to increased harvest yields and additional grow cycles, and achieving a recent record of 37.7% THC content cannabis harvest. The Company has a strong balance sheet and healthy cash position of $13.4 million (end of Q1 2021), which Vibe intends to deploy to initiatives critical to increasing production and yield capacity. The Company anticipates the initiatives to cost approximately $1.7 million US for the Phase I expansion and $4.0 million US for the Phase II expansion.
Plans for the licensed Sacramento facility are subject to various regulatory approvals and the Company anticipates completion of Phase I in the second half of 2021. Vibe has commenced its two-phased Sacramento cultivation expansion as follows:
Phase I:
- The first phase of construction shall expand canopy and increase Vibe's annual cannabis production to $8.3 million US at the existing Vibe-owned 2-acre Sacramento Cannabis Campus, including new vegetative grow, flowering and drying rooms. This is in addition to our Crescent City annualized forecast greenhouse revenues of $6.0 million;
- The additional canopy square footage is to be achieved by upgrading the existing Vibe cultivation buildings and current cultivation operations to a two-tiered vertical growing system using advanced irrigation and nutrient delivery systems;
- The additional canopy is expected to increase the yield of premium indoor flower and trim/biomass for use in Hype Cannabis Co. retail products.
Phase II:
- The second phase of construction is subject to customary regulatory approvals, upgrade of electrical service and construction of a new building on land owned by Vibe;
- Will add an additional $10.9 million US in cultivation production to the additional $6.1 million US annual production from Phase I expansion;
- Initial planning of the new building has commenced and the expansion will entail construction of a new building, site servicing, and fixturing of new vegetative grow, flowering & drying rooms.
Mark Waldron, CEO of Vibe, stated, "Our expansion goals on our Sacramento campus are to add an additional $17 million annually in high-margin and high-quality cultivation revenues. Our cultivation expansion will provide us significant economies of scale and the ability to improve margins, generating an optimal return for Vibe shareholders. In addition to allowing us to take advantage of opportunities in the state for premium indoor flower, expanding our cultivation capabilities underpins our plan to increase the degree of vertical integration for our Hype Cannabis Co. products, as well as the continued expansion of our retail footprint in California."