Search
Search
Close this search box.

Chill Brands Sees Stock Climb 80% On New UK Supply Deal, IM Cannabis Reduces Losses, & Celadon Signs First Supply Contract

Chill Brands Group 

 

Chill Brands’ stock value has nearly doubled over the last week following the announcement of a new sales and distribution partnership in the UK.

On May 18, 2023, the company informed investors that it has signed a new contract with UK-based vaping ‘sales, distribution and marketing agent’ The Vaping Group.

The Vaping Group, which reportedly has a ‘footprint in hundreds of UK vapour stores and access to tens of thousands of independent convenience stores’, has agreed to launch Chill Brands range of nicotine-free vapour products to the UK market.

Sales of Chill Brands’ products are expected to start this summer, with The Vaping Group committing to introducing the brand into the European market ‘once a recurring base of revenues has been established for Chill Brands’ products in the UK’.

The news has seen the CBD company’s stock jump over 80%, rising to levels not seen since early 2022.

Both companies state this is an opportunity to capitalise on the growing calls from ‘regulators and industry peers’ who are increasingly calling for answers to issues surrounding ‘sustainability and social responsibility’.

It comes just weeks after Chill Brands announced a similar deal was announced in the US, alongside two further successful fundraises totalling £3m.

Chill Brands reportedly received a purchase order from a Florida distributor representing a ‘significant proportion’ of its existing nicotine free vapour products, which are also understood to be ‘under consideration by numerous retail buyers in the US’.

 

Celadon Pharmaceuticals 

 

UK cannabis operator Celadon Pharmaceuticals also announced that it had signed its inaugural supply contract this week, worth at least £3m over the next three years.

Celadon announced in a press release yesterday (May 24) that it has now signed its first ever contract for the commercial supply of its high-THC cannabis with an unnamed ‘leading UK medical cannabis company’.

The agreement will see the first shipment of product made in Q4 this year, with Celadon contracted to sell ‘a minimum’ of £3m by 2026.

Should both parties consent, the deal could then be extended for a further two years until 2028, while Celadon says it has received multiple additional ‘expressions of interest’ which could include a further deal worth £7m if successfully converted into a commercial contract.

The company’s inaugural deal comes less than six months after Celadon secured its GMP licence in January of this year.

The company also announced this morning, that the Mayor of the West Midlands Andy Street had recently completed a tour of its 100,000sq ft facility.

Mr Street said: “We know just how important the healthcare and life sciences sector is to the future prosperity of the West Midlands’ economy, which is why we’ve made it one of the key clusters to focus on as part of our Plan for Growth.

“I was delighted therefore to have the opportunity to visit Celadon, which really is at the cutting edge of cannabis-based medicines and has a key role to play in our future plans.

“The UK may already have an established golden pharmaceutical triangle of London, Oxford, and Cambridge – but Celadon’s investment and expansion plans show just how rapidly the West Midlands is becoming a key player in this sector. I look forward to continuing to work with them and growing in partnership.”

IM Cannabis 

 

Another of this week’s biggest movers was IM Cannabis, seeing its stock jump over 30% to back above $1 on the NASDAQ.

It followed the release of its Q1 earnings report last week (May 15), which saw the embattled company reveal a number of significant cost reductions.

For the three months ended March 31, IM Cannabis reported revenues of $13.2m, remaining largely flat on the $13m reported in the same period a year earlier.

This was, in part, due to a significant reduction in its selling price per gram of cannabis, dropping from $8.13 in Q1 of 2022 to $6.59 in Q1 this year, due to ‘increased competition within the retail segment’.

While revenues struggled to see much in the way of sustained growth, IM Cannabis saw its gross profits increase by 46% year-on-year to $3.5m, while gross margins grew from 24% to 30%, which it attributed to ‘reduction of costs of sales’ and ‘high margin sales of imported premium cannabis’.

Said reductions include a 41% decrease in total operating profits, dropping from $11.3m to $6.5m year-on-year, with most of the decline attributed to ‘restructuring’ efforts during the quarter, including the 21% reduction in workforce in Israel ‘across all functions’.

Despite further reductions, IM Cannabis continued to report significant losses. For the quarter it posted an operating loss of $3m and an EBITDA loss of $1.3m, down from $8.9m and $2.9m respectively.

Related Posts

Related Posts

CONNECT

Related Posts

Related Posts

Recent Posts

Related Posts

Subscribe to our mailing list to receives daily updates!

We won’t spam you

Categories

Browse by Tags

CATEGORIES

EDITION

BUSINESS OF CANNABIS

© 2023 Prohibition Holdings Ltd. All Rights Reserved.

EDITION

Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?