FSD Pharma Inc. (CSE:HUGE), a Canadian marijuana stock, said it has a strong cash position and construction of its Coburg facility remains on schedule in this market news
SmallCapPower | September 6, 2018: FSD Pharma Inc. (CSE:HUGE) Friday reported its financial and operational results for the second quarter of 2018. FSD Pharma, through its wholly-owned subsidiary FV Pharma, is a licensed producer of marijuana under the ACMPR, having received its cultivation license on October 13, 2017. It is headquartered at the former Kraft foods plant in Cobourg, Ontario. The Company plans to transform the facility into the largest hydroponic indoor cannabis facility in the world.
FSD Pharma, one of the Canadian cannabis stocks, reported revenues of $29,372 in the quarter ended June 30, 2018 as compared to $39,983 in the quarter ended March 31, 2018. The Company saw a net operating loss of $3.4 million due to consulting fees, salaries and professional fees incurred to complete the reverse takeover transaction between FV Pharma and FSD Pharma, as well as infrastructure cost to build its cannabis operations. FSD Pharma has a strong cash position of $31.7 million in cash and equivalents at June 30, 2018 and no debt.
Construction of its Coburg, Ontario facility remains on schedule with cultivation expected to commence in the first half of 2019, which will be in excess of 3,000,000 square feet, with an expected annual output of 400,000,000 grams of which FSD Pharma would net 200,000,000 grams. The Company has reported completion of 25,000 square feet solely owned by FSD Pharma. The Company has said that the construction is in progress for the Auxly partnership Phase 1, approx. 220,000 Sq. Ft. expansion at Cobourg, Ontario, with a total budget of $55 million and the construction of Phase 1, approx. 105,000 Sq. Ft. by Cannara partnership at the facility close to Montreal, Quebec.
FSD Pharma CEO Thomas Fairfull said, “We are pleased with the achievements that have been made since going public. We continue to invest in ensuring we have the right assets and infrastructure in place to position us as the largest indoor cannabis grows operation in the world. Construction with our partners Auxly is moving forward and we expect to have our sales license shortly. We will pursue R&D initiative to better position us for growth on the pharma side of the industry. We have the necessary cash balance and partnership to complete our expansion quickly.
FSD Pharma trades at a market capitalization of $450.58 million with a price to book multiple of 20.0x.
Disclosure: Neither the author nor his family own shares in the company mentioned above.
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