The facility will be capable of producing isolated cannabinoids such as CBD, CBG, CBC and CBN, as well as full spectrum and broad-spectrum oils without THC.
The proprietary extraction system will reduce industry-standard costs by about 50%, producing CBD oil for less than half of the $1.50/gram average extraction cost for the hemp industry.
“We committed the necessary capital and resources to execute this project which we believe will bring higher returns in the future,” stated 1933 CEO, Chris Rebentisch.
At a time when many other cannabis companies are cancelling deals, scaling back products and killing construction projects, 1933 is expanding.
How can they afford it?
1933 has a “strong balance sheet with a cash position of $17.6 million,” reported Parry on November 28, 2019, “a robust increase of 245% over the previous year of $5.1 million, allows the company to fund capital projects.”
1933 also booked a 44% year over year increase in revenue, totaling $18.1 million, with a gross margin of $5.3 million. 1933 has a market cap of $57 million. The market cap is currently about 3X the yearly revenue.
The hemp extraction facility will comply with “existing and anticipated state and federal hemp manufacturing rules.” It is also engineered to meet required GMP standards, which will allow TGIF to expand distribution into global markets.
The proposed equipment in undergoing a mandatory peer review as required by Clark County, Nevada. The peer review should take about four weeks to complete. Meanwhile, electrical and mechanical systems are being prepared. All phases of construction require approval by Clark County.
The entire project is projected to take 4-8 months to complete, “based on the response times and approvals by the city and county.” That timeline may sound flaky, but 1933 has a stellar track record of hitting its milestones.
The Lab will be located adjacent to 1933’s current 12,160 sq. foot cultivation facility in Las Vegas.
The existing building has received the necessary approvals for new zoning and permitting for hazardous materials from County authorities and has secured an Industrial Hemp Handler Certificate.
The facility’s monthly processing capacity is estimated at approximately 68,000 kg. (150,000 lbs.) of hemp biomass to produce 5,000 kg of full spectrum oils or 4,500 kg of CBD isolate.
The proprietary FDA level, state-of-the-art hemp extraction system has been designed to extract CBD oil with an average efficiency rate of 2.3 times greater than the current industry standard, thereby cutting costs by at least 50 percent.
1933 hemp extraction key features:
- Alcohol extraction process
- Proprietary short chain/long chain liquid/liquid extraction
- Customized hardware
- Engineers and chemists from FDA regulated facilities
- Enhanced automation
- Elimination of expensive chilling
- Recovery of all solvents
- Radical reduction of carbon footprint
The Lab will deliver broad spectrum oils and distillates consistently, with the THC content registering under the current 0.3 % legal limit. Designed to process live plants, 1933 will have the ability to formulate cannabinoid content into its own oil compounds and customize its own blends.
The Lab will enable 1933 to control the quality of downstream products, like its Canna Hemp wellness line of CBD products.
Two weeks ago, 1933 announced that its subsidiary, Alternative Medicine Association, entered into a licensing agreement with Capna Intellectual, developer of The Bloom Brand.
Bloom is sold in over 300 licensed retailers in California, Nevada, Washington and New Mexico, with further expansion planned for new markets in Oklahoma, Massachusetts and Canada.
“Our goal is to expand beyond our proprietary AMA products and represent the very best cannabis brands in Nevada,” stated Ester Vigil, President of 1933 Industries, “Bloom is a brand we have been watching for some time”.
“We started with a few thousand dollars in sales two years ago, and we now sell an average of $750K per month,” stated Vigil, in an interview, “I want to connect people with the brand and the way to do this is through education”.
1933 owns 91% of Alternative Medicine Association and 100% of Infused MFG, operating in Nevada, Colorado and California.
“The hemp processing Lab will also enable us to control our production costs and better position our price points in any market conditions,” stated Rebentisch, “We are one of a few facilities in Nevada that will be processing hemp at this scale and the end product will be able to be sold across the United States.”
No, 1933 is not profitable yet. But if you’re sniffing around for a beaten down cannabis company with an expanding business core, 1933 should defz be on your radar.
Full Disclosure: 1933 Industries is an Equity Guru marketing client.