Aleafia Health Inc ALEAF

AH SUCCESSFUL OUTDOOR HARVEST ACCELERAES PRODUCT EXPANSION

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Aleafia Health Successful Outdoor Harvest Accelerates Product Portfolio Expansion

TORONTO, November 6, 2020 – Aleafia Health Inc. (TSX: AH, OTC: ALEAF)

(“Aleafia Health” or the “Company”) is pleased to report its Port Perry Facility’s preliminary outdoor cannabis harvest results, where 50,000 plants have yielded approximately 31,200 kgs of dried cannabis flower at a cash cost per gram to harvest of $0.10. 

“The 2020 harvest is a major step forward from our previous year’s results. It also represents a shift in focus, from producing extractable biomass, towards high quality dried flower tailored to adult-use consumers,” said Aleafia Health CEO Geoffrey Benic. “An expanded dried flower offering is a key component of our product portfolio’s broader expansion. Along with many new, innovative Cannabis 2.0 launches in the near term, this marks an incredibly exciting growth period for Aleafia Health.”

• Expansion of Adult-use Dried Flower Portfolio: 7,200 kgs of THC-dominant dried flower was harvested, of which a significant portion is now allocated for sale into the adult-use market. The Company will release an enhanced dried flower portfolio, including a pre-roll line with SKUs featuring different potencies, sizes and price points, tailored to key consumer segments. In contrast, the 2019 outdoor crop did not include any THC-dominant cultivars. 
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• Input Material for New CBD Wellness Line: Additionally, 24,000 kgs of CBD-dominant dried flower was harvested, which will be used as inputs in the Company’s 2021 CBD wellness line of new formats, and in wholesale transactions. 
• $0.10 Cash Cost per Gram: The Company’s low cost cultivation advantage is solidified with a $0.10 cost per gram to harvest, which comprises all operating expenses including labour, consumables, services and staff overhead. 
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• Testing Results: Preliminary test results indicate that cannabinoid content is again comparable to the results of identical cultivars grown indoor. While these results are extremely encouraging, the Company cautions that, as with last year, potency and quality control tests for the entire crop will not be completed for another two to three weeks. 

All figures are approximations as drying and weighing for the final 15 per cent of the harvested crop will be completed throughout November. 
 
 
2021 Outdoor Cultivation Plans
Preparation for the 2021 outdoor cultivation season is already underway, with a number of optimizations enacted to further improve results: 

• Infrastructure Entirely Complete: In 2020, an additional 30,000 sq. ft. of Health Canada-licensed support buildings were completed. Used for drying, storage and propagation, they bring the licensed support infrastructure to 35,000 sq. ft.  Underground irrigation was installed throughout the entire 86 acre cultivation area, including a centralized Irrigation Facility, which delivers custom feeds to various zones dependent on cultivar type. Automation was also introduced to add efficiencies to the planting and harvesting processes. No further significant capital improvement will be required in 2021, and the infrastructure in place is built to propagate, irrigate, harvest and dry 86,000 cannabis plants and up to 100,000 kgs. The earlier start should result in a significant improvement in yield per plant, compared to 2020. Covid-19 related delays in municipal building permit authorizations led to the installation of in-ground irrigation and nutrient lines for the newly licensed Phase II expansion not  being completed until July. Concurrently, a heat wave prevented planting until all irrigation was in place.
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• Clone Propagation on-site: This year, the Niagara Greenhouse Facility was used as a staging ground to prepare the outdoor crop. Next year, all propagation activities will be conducted in the 35,000 sq. ft. support buildings on-site at Port Perry. This will allow for pre-vegetation to occur during the winter months, leading to the plants entering the ground significantly earlier and at a more mature stage. Additionally, this allows the Niagara greenhouse facility’s perpetual harvest production schedule to continue uninterrupted. 
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• R&D Genetics Program: Approximately 40 new genetics were planted at Port Perry this year in a separate research and development zone. Testing to determine which genetics are best suited for outdoor cultivation is underway with several promising candidates expected to be included in the 2021 crop. 

For Investor & Media Relations:
Nicholas Bergamini, VP Investor Relations
1-833-879-2533
[e-mail]
LEARN MORE: www.AleafiaHealth.com
About Aleafia Health:
Aleafia Health is a vertically integrated and federally licensed Canadian cannabis company offering cannabis health and wellness services and products in Canada and in international markets. The Company operates medical clinics, education centres and production facilities for the production and sale of cannabis. 

Aleafia Health owns three significant licensed cannabis production facilities, including the first large-scale, legal outdoor cultivation facility in Canadian history. The Company produces a diverse portfolio of commercially proven, high-margin derivative products including oils, capsules and sprays. Aleafia Health operates the largest national network of medical cannabis clinics and education centres staffed by MDs, nurse practitioners and educators and operates internationally in three continents.

Innovation, the heart of Aleafia Health’s competitive advantage, has led to the Company maintaining a medical cannabis dataset with over 10 million data points to inform proprietary illness-specific product development and its highly differentiated education platform FoliEdge Academy. The Company is committed to creating sustainable shareholder value; the TSX Venture Exchange named Aleafia the 2019 top performing company prior to its graduation to the TSX.