Clever Leaves has announced the wind-down of all operations in Portugal, expecting its Portuguese flower cultivation, post-harvest processes, and manufacturing activities to cease in full by the end of the first quarter of 2023.
Beginning in the second quarter of 2023, Clever Leaves will solely cultivate its flower strains in its Colombian greenhouses, where preparations for dry flower exports have been underway for the past 18 months.
The company has stated it believes it remains on track to commence sales of dry flower from Colombia later this quarter.
CEO of Clever Leaves, Andres Fajardo, commented: “By exclusively cultivating and producing our cannabinoid products in Colombia, we aim to leverage our existing cost efficiencies in the country as we ramp our dry flower offering.
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“We believe this transition will allow us to optimise our production infrastructure and drive increased cost savings, positioning us to compete more effectively in the global medicinal cannabis market.
“Although our decision was extremely difficult, we believe it is in the best interests of the Company, since it positions us more effectively to satisfy our customers’ requirements. Additionally, we plan to incorporate the substantial learnings from our work in Portugal to enhance the success of our Colombian operations.
“This next phase of our restructuring work builds upon the progress we have made with improving our cost structure and capital efficiency throughout 2022. We look forward to building upon our sustainable competitive advantages in Colombia and progressing further into 2023 as a leaner, more agile multinational operator.”
Clever Leaves’ Colombian operations span over 1.8 million square feet of fully built-out cultivation capacity, with EU-GMP certifications for the production of both cannabis extracts and dry flower. Additionally, its Colombian operations house a genetic discovery and development platform, comprised of both outside strains from major cannabis brands and in-house developed products.
Fajardo continued: “We believe we are well-positioned to ramp quickly in Colombia to serve our global customer base, while maintaining our focus on growing the most premium and commercially viable flower strains. Our expansive, fully built-out production capacity gives us significant scale to meet customer demand, and our EU-GMP certifications facilitate multiple pathways to our key international markets.
“We are working swiftly to refine and expand our flower portfolio to the specifications of our target markets. We aim to use our learnings from our Portuguese flower cultivation and our existing Colombian production efficiencies to build our flower capabilities and further complement our extract business.
“We are grateful for our affected team members and their contributions to Clever Leaves. While the decision to reduce our workforce was a very difficult one, it is an important extension of our ongoing work to align our expense base with our current revenue profile and improve our operating leverage over time. We expect our operational transition to drive significant long-term savings for the benefit of our customers and shareholders as we make progress towards profitability.”
