Plus Products (PLUS.C) is a California-based company making cannabis-infused edibles for the medicinal and adult-use recreational markets.
Plus’s dedicated 12,000 sq. ft. cannabis production facility in Adelanto, California is operating under a temporary manufacturing license.
According to Plus Products latest financials, its revenue grew 617% to $2.56 million in Q3, 2018.
Plus Products Q3, 2018 vs. Q2, 2018
- 617% revenue increase to $2.56 million
- 104% retail sales growth to $8.0-million
Those numbers tell us, very crudely, that Plus receives about 32% of the retail price.
“100% of our revenue is from wholesale edible branded product sales. Branded edible market share is difficult to earn, yet is one of the most important metrics of long-term shareholder value.,” stated Jake Heimark, CEO of Plus, “Our brand is now the leading edibles brand in the largest and most competitive cannabis market in the world.”
Heimark is right. Hundreds of new products are flooding into the California market. As competition for shelf space gets fierce, most of the products are losing market share (even while sales numbers may be going up).
Plus Products is bucking that trend, as sales and market share increase. The pie is growing and Plus is getting a bigger piece of it.
“PLUS Sour Watermelon Gummies and PLUS Blackberry & Lemon Gummies are the #1 and #2 best-selling branded products, respectively, across all categories in California including flower, vaporizers, edibles, and topicals,” stated a BDS Analytics repot.
PLUS pays BDS a nominal fee to acquire access to its cannabis market data. BDS confirmed to Equity Guru via telephone – that is the only financial relationship between the two companies.
On January 17, 2019 Plus announced the launch of a 4th limited edition of its infused gummies – Pink Lemonade.
The gummies are available for a limited time at select dispensaries in California; the proceeds from the launch will be donated to the National Parks Foundation.
PLUS Pink Lemonade flavored gummies are a twist on a classic flavor that strikes the perfect balance between sweet and tangy. They are precisely dosed with 3.5mg of THC and 1.5mg CBD. These Sativa gummies are sure to melt away the winter chill and leave you feeling delightfully refreshed.
“Pink Lemonade was our most popular flavor among consumers during in-store product tests,” stated Heimark, “Not only do we have an exceptional new product to offer, we are donating a portion of our sales to the National Park Foundation – which protect treasured landscapes for generations to come.”
Getting feedback from customers through its “experimental series” of limited edition/seasonal products allows PLUS to roll out high quality products that consumers love.
It’s also a good method of introducing new customers to the product line.
Past limited-edition products include Holiday Bliss Cranberry & Shortbread; Valentine’s Day Rose & Vanilla; and for Pride Week, Rainbow Sorbet.
“The share of cultivation demand for processing into edibles will grow steadily as the category continues to gain share of consumer spending,” states BDS, “In 2017, 143,902 pounds of raw flower were processed into edibles, up from 36,127 pounds in 2014.”
An estimated 360,844 pounds of raw flower will go into edibles in 2022 – a five-year compound annual growth rate of 20.2%.
“If you’re going to spend a year testing what products, branding, and business practices will work in an emerging market,” stated Equity Guru’s Chris Parry about PLUS, “making them work in California is a hell of a way to make your strategy bulletproof.”
Plus IPO’d on October 26, 2018 raising $20 million on the CSE.
They are funded now to continue product line expansion and strategic acquisitions.
Full Disclosure: Plus Products is an Equity Guru marketing client, and we own the stock.