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Written by
Richard Sandle
Published on
September 14, 2017
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On July 1, 2017, the use of recreational marijuana became legal in the State of Nevada. Virtually all marijuana dispensaries throughout the state completely sold out on the first weekend of the new laws taking effect. Many marijuana companies are expecting the same phenomenon to take place next year in Canada on a national level when recreational marijuana is legalized throughout Canada.EMBLEM CORP COM NPV (OTCMKTS:EMMBF) is one such Company that is aggressively expanding in an effort to prepare and capitalize on the anticipated legalization of recreational marijuana in Canada.For those not familiar with Emblem Corp, the Company is licensed under the Access to Cannabis for Medical Purposes Regulations as a producer of Medical Cannabis in Canada, and is led by a team of former Healthcare & Pharma Executives who have built & run multi-billion dollar companies. Uniquely positioned within the vastly-growing medical and recreational cannabis industry, the Company’s targeted strategy flows across three distinct verticals of cannabis production, patient education, and pharmaceutical R&D. Emblem carries out its principal activities producing marijuana from its facilities in Paris, Ontario pursuant to the provisions of the ACMPR and the Controlled Drugs and Substances Act (Canada) and its regulations.On August 28, 2017, Emblem Corp released its financial results for the second quarter of 2017 ending on June 30, 2017. Total revenue for the quarter amounted to C$538,475. This brings the total revenue for the year so far to C$1,441,749. The Company however, continues to operate at a Net Loss. Second quarter Net Loss is reported at C$2,954,340, most of which can be attributed to the continued aggressive expansion that the Company is in the midst of in anticipation of the increased demand for marijuana as a result of the forthcoming recreational marijuana market in 2018.During the second quarter, the Company continued its expansion efforts to increase its dried flower production capacity from 650 kgs. per annum to more than 1,650 kgs. per annum by the end of 2017. With three out of four of the Phase 2 Grow Rooms now substantially complete, the incremental capacity is expected to contribute to the Company’s financial performance in the fourth quarter and beyond. Production capacity is expected to further increase to 2,000 kgs per annum in spring 2018 once the fourth Phase 2 Grow Room is operational.The Company’s balance sheet remains strong reporting assets of C$48,617,919, of which C$23,646,442 are cash and cash equivalents. Liabilities come in at C$8,370,634. Gordon H. Fox, CEO of Emblem commented:

“With the more than doubling of our production capacity complete and the imminent receipt of our cannabis oil license, combined with the strength of our marketing platform and patient registration pace, we are well positioned to demonstrate progress towards profitability in 2018,”

In other news, on August 25, Emblem Corp announced that it amended its investor relations and capital markets advisory services agreement with Spinnaker Capital Markets Inc., pursuant to which Spinnaker will provide capital markets and investor relations advisory services to Emblem until April 30, 2020. Pursuant to the Agreement and as disclosed in the Company’s press release dated April 17, 2017, the Company has issued an aggregate of 200,000 incentive stock options with an exercise price of $2.60 per share and will pay Spinnaker a monthly fee of $10,000 plus applicable taxes. The Agreement is subject to the acceptance of the TSX Venture Exchange.Also, on July 24, 2017, Emblem Corp announced that the Company issued a total of 30,435 common shares of Emblem in connection with the granting of an exclusive license to Emblem pursuant to a white label agreement entered into between the Company and an arm’s length third party on December 23, 2016. Pursuant to the Agreement and subject to the approval of the TSX Venture Exchange, Emblem has been granted the right to use certain intellectual property in connection with its branding, promotion, marketing, packaging and sale of branded dried marijuana products in Canada. The exclusive license shall be in effect until December 23, 2018. At present, the “Third Party” remains unnamed to the public.

Since our last review of EMMBF on June 1, 2017, the stock has been in a range with resistance at $1.6867, and a support level at $1.1594. The stock is currently trading at $1.3700. Current market capitalization stands at $70.37 million, on 51.36 million shares outstanding as of September 13, 2017.Emblem Corp is now showing consistent revenue, and has a very strong balance sheet with enough capital to continue to execute its future plans. The savvy investor should look at EMMBF as a must-own cannabis stock ahead of next year's recreational marijuana initiative. We will be updating our subscribers as soon as we know more. For the latest updates on EMMBF, sign up below!Image courtesy of GoToVan via FlickrDisclosure: We have no position in EMMBF and have not been compensated for this article.

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