- Red White & Bloom Brands is a multi-state cannabis operator based in Canada and focused on developing revenue opportunities in strong U.S. cannabis markets such as Michigan, Florida and California
- The company recently announced it has eliminated $115 million in debt liabilities as part of its efforts to streamline its financial operations during a period when many companies are struggling with the effects of the COVID pandemic
- Red White & Bloom’s debt reduction includes cutting over $22 million in annual expenses
- The company has solidified its foothold in Michigan with acquisitions that have allowed it to become vertically integrated and open new dispensaries and cultivation facilities
Multi-state cannabis operator Red White & Bloom Brands (CSE: RWB) (OTCQX: RWBYF) is making new strides in streamlining its operations as the company accelerates its push toward making its popular Platinum Vape-branded products some of the most recognizable premium cannabis products in the United States.
Red White & Bloom, or RWB, has been strengthening its revenue streams in the states where it operates, particularly in Michigan, Florida and California of late, while also working to deal with its debt to make it more long-term feasible, announcing April 20 that it has eliminated several million dollars’ worth of liabilities and annual expenses (https://cnw.fm/4X0Ot).
The acquisition earlier this year of a 15,000-square-foot manufacturing, processing and distribution facility as well as properties owned by PharmaCo, Inc., in Michigan, plus full licensing for manufacturing both medical and adult use cannabis products in the state, assured RWB’s efforts to become fully vertically integrated and to expand the reach of Platinum Vape.
Platinum Vape products not only include carefully crafted vape cartridges and disposable vape pens, but also gummies, chocolates and premium cannabis flower.
New data published on the Canadian Federation of Independent Business (“CFIB”)’s Small Business Recovery Dashboard is shining a light on the difficulties SBEs are facing in Canada in the wake of the COVID pandemic and the “staggering level of fresh COVID-related debt small firms have had to take on” as a result of the pandemic’s battering of economies worldwide.
“Two-thirds of small businesses (65%) have had to take on debt, at an average of $160,000, just to survive the past two-years,” CFIB president Dan Kelly stated in a news release about the survey results (https://cnw.fm/lYNWE). “For almost 900,000 business owners, up to $60,000 of this debt is in the form of a government-backed Canada Emergency Business Account loan. … The 2022 budget missed an opportunity to forgive a larger portion of these loans for the most deeply affected small businesses.”
Vancouver, British Columbia-based RWB’s April 20 announcement notes that the company expects to eliminate an intangible asset of about $77 million as well as a license liability of $60 million from its balance sheets following restructuring of its debt while reducing “well over $100 million of liabilities without any dilution to our shareholders,” a continuation of efforts since last year to cut debt.
As part of the restructuring, RWB pruned its Illinois property, exiting “the one state that had not contributed any revenue from THC operations to our results since our inception,” CEO Brad Rogers stated.
“We still believe that Illinois could be a great market for us, and will look to pursue it from an asset-light approach through licensing of our own brands,” Rogers added. “We will continue to look for opportunities to grow our revenue through a number of asset-light entries to other states, while focusing on getting to a positive adjusted EBITDA run-rate by the end of 2022.”
The company has also found ways to reduce its headcount as part of the effort, joining other SBEs in a revived trend to control their cash consumption and attract new capital through minimal staffing adjustments (https://cnw.fm/zbX8U).
“We are very pleased with the significant balance sheet and operational improvements we have made in a relatively short period of time. Today’s announcement is the culmination of an in-depth review and rationalization of assets and operations,” Rogers stated.
For more information, visit the company’s website at www.RedWhiteBloom.com.
NOTE TO INVESTORS: The latest news and updates relating to RWBYF are available in the company’s newsroom at https://cnw.fm/RWBYF
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