First Day of Rec Weed: according to a Global News Report, on October 17, 2018 – “10,000 cannabis sales were made in BC” worth an estimated $41,000.
The Société Québécoise du Cannabis pulled in about $220,000 in sales.
Alberta Gaming, Liquor & Cannabis booked $730,000 in sales.
In Atlantic Canada: Nova Scotia Liquor Corporation reported “just over $660,000 in sales”. P.E.I. sold a total of $152,408 worth of pot.
[Editor’s Note: There is no published data for Manitoba, Ontario or Newfoundland].
Atlantic Canada had a 600% greater per-capita demand than BC, Alberta and Quebec.
Biome (BIO.C) is exploiting this anomalous pocket of demand by focusing on Atlantic Canada, with 390,000 square feet of production capacity, operating or under development in the region.
Stats Canada Q3, 2018 National Cannabis Survey confirmed Atlantic Canada’s high demand for pot.
National Cannabis Survey Highlights:
- Nova Scotians consume 51% more cannabis per capita than the national average.
- Nova Scotians have the highest cannabis consumption rate in Canada
- 23% of Nova Scotians consumed pot in Q3, 2018.
- 19.4% of Atlantic Canadians consumed pot in Q3, 2018
- This is 4% higher than the national average of 15.2%.
“We spotted the lack of competition and high per capita consumption early on and set out to acquire subsidiaries and establish partnerships across the region,” stated Biome CEO Khurram Malik.
This is bullish news for Biome given that Atlantic Canada represents 7% of the population and has only 5% of granted licenses.
“We are building a strong Atlantic Canadian ecosystem,” confirmed Malik, “creating full-time employment, boosting economic growth, and establishing partnerships with organizations interested in enhancing their communities.”
On October 19, 2018, Biome unveiled its 5th subsidiary company and brand, Red Sands Craft CannabisCo, located in Prince Edward Island (PEI) – servicing “the local and tourist markets” with regionally grown cannabis products.
The Red Sands logo reflects PEI’s “iconic red sand beaches”.
About 153,000 residents live on PEI.
The province has a robust tourism industry, with 1 million overnight stays last year, with 1.56 million visitors (10 tourists for every resident). Total tourist spend was almost half a billion dollars (40% bigger impact than the fisheries).
“We plan to create an experience that will enhance the tourism industry in PEI,” stated Malik. “by creating a unique cannabis-centered ecosystem, or biome, in PEI under our RedSands brand that currently does not exist anywhere else in the Canadian cannabis market.”
A few weeks ago, Malik discussed Biome’s Atlantic business strategy with James West on the Midas Letter.
The interview is noteworthy for two reasons:
- West asked some hard-ball questions
- Malik returned the balls with no spin.
“Biome intends to do the majority of its sales overseas in the next two or three years as more and more countries come online in 2019 and beyond,” stated Mr. West.
To help expand market share, Biome appointed Steven Poirier, former president of Moosehead Breweries.
‘’ They got themselves a stone-cold killer in the booze biz,” stated Equity Guru’s Chris Parry, “As president of Moosehead Breweries, Mr. Poirier oversaw the company’s three operating divisions. Moosehead Breweries is the third largest brewery in Canada and holds the largest share of the beer market in New Brunswick.
Red Sands will take cannabis from other Biome Grow subsidiaries, and convert it into oils, creams, tinctures and digestibles. Biome’s investment in PEI will be an initial facility of approximately 35,000 sq ft for extraction and manufacturing.
Biome is incubating a number of interesting subplots.
On June 19, 2018, Biome cut a deal with Occupied VR to acquire Weed Virtual Retail – a VR platform focused exclusively on the medical and recreational cannabis markets.
“Adding Weed VR to our holdings allows us to integrate new technology into those services and increase consumer accessibility across Canada, and international markets, through virtual, augmented, and mobile platforms,” stated Malik.
Buying weed in a virtual environment doesn’t sound like fun – but it is. You can sign up to be part of the Beta Launch here.
Weed VR provides a multi-platform virtual catalog system designed to educate, engage and inform consumer cannabis purchases. Weed VR’s proprietary digital 3D scanning process will create the world’s first comprehensive strain library.
On October 17, 2018 each resident of Nova Scotia and P.E.I bought an average of $3.50 worth of pot, while each non-Atlantic Canada bought an average of 58 cents worth of pot.
Biome is trading at $1.50 with a market cap of $160 million.
Full Disclosure: Biome Grow is an Equity Guru marketing client, and we own stock.