RE:RE:RE:RE:The Snoop GapAnd if he jumps off a bridge will you too? This is great though, will take this to the future with us, 4 months from now, mid summer, it states they will be cash flow positive, lets see!
Here's reality: Q1 Sales - 1,710,157 Production Cost - 1,398,241 Q2 Sales - 2,466,121 Production Cost - 2,820,118 Q3 Sales -3,481,000 Production Cost - 5,954,000
Q3 LOSS - (3,316,000) MagicBeans wrote: Financial Outlook Initial financial losses experienced by Tweed and Bedrocan are soon expected to turn to small profits, followed by the big jump in profit for REC. Many acquisitions by Tweed and CGC have not been accretive at present. It's an investment in building a business though and that is important.
CGC shares sell at the highest premium in the space. When the revenues accelerate many of the positioning and good will investments made by management become accretive.
As cash flow positive approaches, I expect the banks will consider offering lines of credit allowing forms of non-dilutive capital financing. By mid-summer 2016, cash flow positive is probable for CGC and remarkable considering the meager size of the Canadian MMJ market in comparison to the future REC market.
Tweed is not yet generating positive cash flow, but it expects to do so by early next year. That will be a critical juncture for the industry, as several firms are hoping to reach profitability at that time.
CGC is on the cusp of positive cash flows with a base of 7300 MMJ patients as of November 30, 2015. An additional 600 additional MMJ patients are acquired each month and break-even is around 12,000 patients. In addition the company is capitalized to the extent of 24 million dollars on the balance sheet.
Bruce Linton: You know, profitability is a weird word. I think it cash flow positive on a simple basis, because you know, you get EBITDA and all this bullshit, I just look at it and say if in fact you're generating free cash flow from operations before taxes and all that stuff, that's relevant, and because we've done all the construction and sunk all those costs, we're in the mode in November where we're not building anything right now. We've built out about 500,000 square feet of space, and it's producing, and so I think free cash flow is a function of patients. You know, you get around 10,000, 11,000 patients and that starts happening, and we announced that we're through 6,000. The rate at which you add them is amazingly accelerating when you start to do a lot of stuff right.
Cash burn clearly diminishes each month with fewer capital construction costs on build outs and also many expenses occur from investment into building infrastructure that can reap benefits in the coming years. The game breaker happening now is market size will catapult past 35,000 MMJ patients and gain millions of REC customers in Canada providing reason to expect large share price gains.
https://www.midasletter.com/2015/10/canopy-growth-corp-tsx-v-cgc-bruce-linton-cannabis-mmpr-justin-trudeau/