DOJA Cannabis Company to expand production capacity to over 5,000 kilograms per year
KELOWNA, BC, Oct. 3, 2017 /CNW/ – DOJA Cannabis Company Limited (“DOJA” or the “Company”) (CSE: DOJA) is pleased to announce that its arm’s length offer to acquire (the “Acquisition”) a 22,580 sq.ft. building in Kelowna, British Columbia out of receivership has been approved by the courts. It is anticipated that the closing of the Acquisition will occur on October 27, 2017. Upon completion of the build-out of DOJA’s new facility (the “FUTURE LAB”), DOJA’s corporate cannabis production capacity is expected to surpass 5,000 kg per year.
The Acquisition is a game changer for DOJA, it allows us to expand our production capacity by almost 8 times, diversify our strain production, integrate a world class extraction lab and leverage the economies of scale that come from a larger growing-space.
Trent Kitsch, CEO of DOJA
Our strategy has always been to reach 5,000 kg of cannabis production per year by the end of 2018, with the addition of the FUTURE LAB we project we will reach or goal in less time and for less capital investment than previously budgeted. The FUTURE LAB has 325 feet of highway frontage which will be utilized to promote DOJA’s cannabis lifestyle brand to the 1.9 million plus visitors to the Okanagan each year and the 40,000 commuters that drive past the facility each day.
This is a transformative transaction for DOJA for the following reasons:
- Potential to Expand Production by 7.6x – With the FUTURE LAB fully built-out, DOJA’s cannabis production capacity is expected to increase by over 760% to more than 5,000 kg of dried cannabis per year, excluding cannabis oil production. By way of comparison, Canada’s largest publicly traded cannabis company, sold 5,985 kg of cannabis over the 12-month period ending June 30, 2017;
- Added Scale Increases Competitiveness – Expanding DOJA’s cultivation capacity and scale was necessary to remain competitive on a national level;
- Secure Source of Premium Cannabis – The wholesale cannabis market is extremely tight with limited strain selection. The Acquisition helps to ensure that DOJA will have a near term supply source for dried cannabis flower grown, trimmed and cured in a premium fashion at a price per gram that is within DOJA’s control;
- Location, Location, Location – The FUTURE LAB is strategically located minutes from Kelowna’s international airport along the only highway into the city from the north – ideal location for creating brand awareness and reducing transportation costs and delivery times;
- Leading Edge Design – The FUTURE LAB is expected to implement the latest and most advanced growing technologies to enhance the quality and yield of the flower while minimizing the operating costs and environmental footprint;
- Reach Production Target Ahead of Schedule – With the legalization of recreational cannabis expected to occur in mid-2018, time is of the essence. The first phase of the FUTURE LAB is planned to be ready for first cultivation prior to July 1, 2018;
- Concentrates are the Future – Cannabis concentrates and edibles are the largest and fastest growing segments of the cannabis market and DOJA expects they will overtake cannabis whole flower sales. The FUTURE LAB will house a state-of-the-art extraction lab that will drive concentrates innovation for DOJA;
- Mortgage Financing Available – To preserve DOJA’s strong working capital position, it is anticipated that up to 75% of the $2.5 million Acquisition purchase price will be financed through debt financing secured by a mortgage over the FUTURE LAB in favour of the lender; and
- Phased Build-out Approach – The build-out of the DOJA FUTURE LAB is expected to be completed in two phases, in a financially responsible manner and within the Company’s capital resources and future cashflow. DOJA has no intention to raise additional capital for the foreseeable future.
DOJA CANNABIS PRODUCTION UPDATE
DOJA plans to harvest its first batches of cannabis on October 16, 2017. After the flowers have been hand trimmed, hang dried, cured, and tested, DOJA plans to request a Pre-Sales Inspection with Health Canada, the last step prior to receiving a Sales License under the Access to Cannabis for Medical Purposes Regulations (“ACMPR”).
ABOUT DOJA
DOJA™ is a premium cannabis lifestyle brand featuring the highest quality handcrafted strains in Canada. DOJA’s wholly owned subsidiary is a licensed producer of cannabis under the ACMPR. DOJA’s state-of-the-art ACMPR licensed production facility is located in the heart of British Columbia’s picturesque Okanagan Valley. DOJA was founded by the proven entrepreneurial team that started SAXX Underwear®.
Original press release: http://www.newswire.ca/news-releases/doja-cannabis-company-to-expand-production-capacity-to-over-5000-kilograms-per-year-649227123.html
