questions for conference call part two This post follows up the post below with more questions.
8 I understand the California licence renewal system is a mess. Can you give us the status of all the temp licences held by Sunniva and how many have been renewed in 2019 ,and how many are waiting renewal.
9 I understand that California tried to encourage small growers by putting a limit on the square feet one grower could have in an enclosed building. That amount is 22,000 square feet, the exact size of one of the 8 bays in the new building . I can see how Sunniva can get a licence for one of the bays, but how can it benefit from the other seven bays?? .It seems that production numbers for Sunniva on chat lines, include all eight bays production, Can you tell us how this works ,when it seems the licence is restricted to 22,000 square feet????
10 There seems to be a lot of confusion between the amount of future production by Sunniva the public company , and production by the Suvinna building, which they don't own? Are they the same?
11 In May 2018 an analyst visited the Campus in California , spoke to senior management, and published an article that said planting will begin June/ July 2018.!!!!! Thats 2018 not 2019 -- that seems like a bad joke today .
In November, 2018, management said on a conference call ,that 100,000 plants would be planted
in the first quarter of 2019. Now, it seems this has been put off to the third or fourth quarter?
The key date is not when the building is finished , or planting, but when will actual cash be received from the sale of the flower. There have been so many delays it's hard to know when this date will happen.
Why not publish that exact date now????
11 In a post in Reddit, a month and half ago, Rob Knowles a VP of Sunniva said that all eight bays of the building will need to be finished before planting starts. Given the delay so far, how long will it be until all eight bays are finished?
12 I don't know how long it will take to finish all eight bays, but if this is true, with months of testing and then planting , processing sales, and finally collecting the receivables, would not the end of the first quarter of 2020 be the earliest we could see some cash?
13 Last year, I understand it was over 125 degrees inside the glass building throughout the summer, and thus it was just too hot to get any work done., or have men inside the building. I know some air condioning equipment was planned to be installed for this year. . Has this equipment been installed now , so temperatures will come down to where is safe to work ? Otherwise we will see a few more months of delay.
14 On reddit there was a comment that power has not yet been installed in the building , and wont be to mid June.
Doesn't this mean there will be no cooling of the temperature in the building until at least mid June?
15 I see in the latest update that another 9 million dollars is required to be paid by Sunniva in equipment for the building. I thought the building was going to be paid in full by the owner. Why does Sunniva have to pay yet another 9 million towards a building it does not own, and will lease at over 12 million dollars a year?
16 The lease rate payable by sunniva is calculated at an interest rate of 17.2% a year. Yes. 17.2% interest not exactly a bargain rate. Does the lease amount go up the more the owner spends on the building? Meaning if the lease was 12 million a year on a 50 million dollar cost- i think this was the original estimate- then does the lease go up by 20% if the owner spends 60 million of the building???