Replies to post #77 on Fire & Flower Holdings Corp (FAF)

[FUNMAN]

Fire & Flower has tons of upside, says AltaCorp Capital

JANUARY 28, 2020
BY STAFF

Remember: Dollars are Canadian - FUNMAN

https://www.cantechletter.com/2020/01/fire-flower-has-tons-of-upside-says-altacorp-capital/

A new deal with a major POS company for the cannabis sector bodes well for retailer Fire & Flower (Fire & Flower Stock Quote, Chart, News TSX:FAF), says AltaCorp Capital analyst David Kideckel, who in a client update on Monday said that retail not production and cultivation is the way to play the current cannabis market.

Edmonton-based Fire & Flower on Monday announced a strategic licence agreement between its wholly-owned subsidiary Hifyre and POS company Cova Software Solutions, whose technology is currently in over 500 cannabis stores across Canada and the US. The deal will see Cova provide to its customers the Hifyre digital retail platform, including the Spark Perks program and the Fastlane “click-and-collect” service, bundled with Cova’s own point-of-sale software.

The agreement will allow for the rapid commercialization of Hifyre’s platform across emerging cannabis markets, says Matthew Hollingshead, president of Hifyre.

“Cova is a leading point of sale company in emerging domestic and international cannabis markets and the Cova and Hifyre teams have worked collaboratively for more than a year now and we are excited to enter into this strategic agreement,” said Hollingshead in a press release.

Kideckel is viewing the event as a positive, saying that it could support Hifyre’s international expansion in the US market as well as strengthen the company’s advanced technology position in Canada.

“FAF remains our top pick in the Canadian cannabis retail space,” wrote Kideckel in his update. “In our view, the agreement with Cova supports Hifyre’s expansion in the Canadian and International cannabis markets and places Hifyre as the industry’s best-in-class digital retail platform. In addition, it provides a venue for FAF to monetize Hifyre’s capabilities further and increases revenues from its high-margin digital retail business segment.”

Fire & Flower, which is already up 23 per cent for 2020, is in a strong position, according to Kideckel, due to its partnership with global retail giant Alimentation Couche-Tard along with its digital capabilities through Hifyre, with the Cova deal (if proven successful over the medium to long term) standing as a further testament to FAF management’s ability to execute to strategy.

Kideckel is maintaining his “Speculative Buy” rating and one-year price target of $2.80 per share, established in a December 17, 2019, client report, which at the time of publication represented a total projected return of 211 per cent.

Fire & Flower reported its most recent quarter on December 16, 2019, where its fiscal third quarter 2019 showed revenue of $13.7 million compared to $2.5 million a year earlier and adjusted gross profit of $4.8 million compared to a profit of $1.2 million a year earlier. For the quarter, Kideckel had been expecting a top line of $12.0 million and adjusted profit of $4.3 million.

In his December report, the analyst said that FAF is facing near-term headwinds connected to regulations, industry conditions and competition, particularly with respect to the highly-regulated cannabis distribution market across the country and increased competition in Alberta’s retail market.

[FUNMAN]

Why I finally started buying from a regulated cannabis store: Sarah Hanlon

I haven't had much incentive to visit my local government-regulated weed store — until now

By Sarah Hanlon, POT CULTURE
January 30, 2020

https://www.thegrowthop.com/cannabis-culture/vape-pens-edibles-cannabis

I have a confession to make: Since Canada legalized cannabis in October 2018, I have only been to the cannabis store a handful of times – until recently that is.

Being a registered medical cannabis consumer allows me to purchase directly online from any licensed cultivator of my choice. I can also grow my own, which my partner has taught me to do very well. And sometimes I still (like many others) make my cannabis purchases in the same way I made them pre-legalization — from an unregulated source. Between the prices, the slow product innovation, quality and convenience, there wasn’t a real incentive for me to visit the Ontario Cannabis Store or a local licensed retailer.

But recently that has all changed. Now that the cannabis 2.0 product wave has hit, I’ve found myself at my local cannabis store more times last week than in the entire year before. Cannabis consumables and vape pens has finally got me surfing.

My first visit ended up being mostly research.

I went on a Monday to get some things for a Thursday night performance of The Phantom of the Opera. The new products had hit shelves just days earlier, and I wanted a couple things that would enhance my theatre-going experience without having to rely strictly on flower — in a crowded setting it can be smelly and not long-lasting enough. And I wanted something “special” for the occasion (in other words: I was looking to spend money). But I wasn’t the only person willing to shell out for new weed products: The store I went to was sold out of most of what I was interested in.

The convenience of a quick, tasty, effective on-the-go-hoot is such a gift.

I went back on Wednesday. The place had been fully restocked, but there still weren’t as many options as I had anticipated – not all companies have new products to offer. But that didn’t stop me from finding some great items, including Tokyo Smoke’s cannabis-infused dark milk chocolate edibles. At 2 mg of THC per piece, the five chocolate squares (each embossed with their minimalist logo) were perfect for my partner and I to divvy up through the night of the play. We are edible light-weights, so we had one each and both felt a perfect little ‘flushy’ buzz within 30 minutes – it was a nice little addition to a pre-show puff and a beer during the show. They were also absolutely delicious, which is a little dangerous if you are trying to refrain from eating the whole bar at once.

We also decided on a Redecan Trainwreck Redee 510 thread vape kit, which comes with a battery, a charger and one 0.45 g 510 thread cartridge filled with high-THC, hybrid distillate with a sativa terpene profile. It tastes piney, earthy, light and I loved it immediately. My favourite part? You can take really thick long pulls with ease – something I have noticed is often not the case with vape pens. And since we were there, we also bought a pre-roll at the suggestion of the lovely Canna Cabana employee helping us: An LBS Sunset pre-roll (15-28 per cent THC potency) which didn’t smoke evenly — I should have loosened the bud by rolling it between my fingers before lighting it. But it did the trick. We were both very baked before the show.

The following week, I was bracing myself for a hectic few travel days that required me to be “on” for long periods of time. So I bought another Redecan vape kit and a cartridge with Zktlz, which is a little sweeter tasting then the citrusy Trainwreck. This way I could take my pen along with me on long work days and leave one with my partner to use.

Having the pen on hand as I hurried from meeting to meeting was a total game changer.

The extract tastes great, but produces very little smell. The efficacy is incredible, I felt the effects within seconds, and they lasted for hours between single pulls. The convenience of a quick, tasty, effective on-the-go-hoot is such a gift. The biggest pro for me? Having a pen like this on hand when I commute from Hamilton to Toronto allows me to hoot without missing a bus or a train to do so. Having a couple pulls on a vape pen between connections, when your feet are tired and your spirit is weak, makes a long commute so much more bearable! And then when I was finally home, I was hungry and ready for dinner — instead of ready to sit down and roll a joint, which is what usually happens after a long day out. The pen has saved me so much time.

Next thing on the list for me are cannabis drinks – I really want to test the purportedly faster onset time. I want to see if I will have a similar experience as I did with the pens where I discover a new way to incorporate cannabis into my life! I could see myself having a cannabis-infused drink out at a party or event.

Concentrates are also on my list. Yes we have access to them in vape pens… but I want to dab! I keep checking back to see when these new products will be available in stores and online (legally, cannabis companies can offer them, but no one has yet).

This is important because it describes a shift away from the black market. - FUNMAN

There’s a lesson here.

For people like myself who have been smoking weed for years, we’re likely going continue to in the way that we did in the past. But if you provide us with new, convenient and quality options that are readily available elsewhere — like what I’ve been seeing coming out in this second wave of products — then we’re going to buy them, too. And chances are we’re gonna enjoy them and become repeat customers. And while we’re there, we might even buy a few things we can get elsewhere, too.

[FUNMAN]

It will get even better with Couche-Tard's investment :-)

4 Canadian Cannabis Stocks With the Best Balance Sheets
JANUARY 31, 2020

https://smallcappower.com/analyst-articles/canadian-cannabis-stocks-best-balance-sheets/

[FUNMAN]

Fire & Flower Begins Trading on OTCQX

February 04 2020

Edmonton, Alberta (February 4, 2020) – Fire & Flower Holdings Corp. (““Fire & Flower” or the “Company”), today announced that it begins trading on OTCQX under the symbol “FFLWF”.

https://fireandflower.com/investor-relations?tab=news-releases&release=fire-flower-begins-trading-on-otcqx

OTCQX is operated by OTC Markets Group Inc. (OTCQX: OTCM) is an operator of financial markets for 10,000 United States and global securities. Through OTCQX, investors can find current financial disclosures and information, including real time quotes, on Fire & Flower.

“Fire & Flower is very pleased to have taken this step to provide greater trading access to investors based in the United States,” shared Trevor Fencott, Chief Executive Officer of Fire & Flower. “We have received significant interest from investors in the United States and listing on OTCQX was a necessary step to provide these opportunities for international investors in our Company.”

Dentons acted for the Company as its OTCQX sponsor.

About Fire & Flower

Fire & Flower is a leading purpose-built, independent adult-usecannabis retailer poised to capture significant Canadian market share. The Company guides consumers through the complex world of cannabis through education-focused, best-in-class retailing while the Hifyre digital platform connects consumers with cannabis products. The Company’s leadership team combines extensive experience in the cannabis industry with strong capabilities in retail operations.

Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc., a licensed cannabis retailer that owns or has interest in cannabis retail store licences in the provinces of Alberta, Saskatchewan, Manitoba and Ontario and the Yukon territory.

Through its strategic investment with Alimentation Couche-Tard Inc. (ATD.A, ATD.B), the Company has set its sights on the global expansion as new cannabis markets emerge.

About OTC Markets Group Inc.

OTC Markets Group Inc. (OTCQX: OTCM) operates the OTCQX® Best Market, the OTCQB® Venture Market and the Pink® Open Market for 10,000 U.S. and global securities. Through OTC Link® ATS and OTC Link ECN, we connect a diverse network of broker-dealers that provide liquidity and execution services. We enable investors to easily trade through the broker of their choice and empower companies to improve the quality of information available for investors.

To learn more about how we create better informed and more efficient markets, visit www.otcmarkets.com.

OTC Link ATS and OTC Link ECN are SEC regulated ATSs, operated by OTC Link LLC, member FINRA/SIPC.

For More Information Contact:

Investor Relations
Chris Bolivar
[e-mail]
1-833-680-4948

Media Relations
Nathan Mison
[e-mail]
780-784-8859

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws (“forward-looking statements”). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “achieve”, “could”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “outlook”, “expect”, “project” and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions “may” or “will” occur. These statements are only predictions.

Forward-looking statements are based on the opinions and estimates of management of the Company at the date the statements are made based on information then available to the Company. Various factors and assumptions are applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Forward-looking statements are subject to and involve a number of known and unknown risks and uncertainties, many of which are beyond the control of the Company, which may cause the Company’s actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct.

The Company assumes no obligation to publicly update or revise forward-looking statements to reflect new information, future events or otherwise, except as expressly required by applicable law.

SOURCE Fire & Flower Holdings Corp.

[FUNMAN]

Nice to see Cova on the list. I like to keep good company.

Remember Fire & Flower has a deal with Cova.

Hifyre Digital Cannabis Platform Announces Strategic Agreement with Cova Point of Sale Software

https://fireandflower.com/investor-relations?tab=news-releases&release=hifyre-digital-cannabis-platform-announces-strategic-agreement-with-cova-point-of-sale-software

Top 50 Cannabis Employers of 2019

Across all industry sectors, these companies provide benefits and perks that show they understand the importance of employee satisfaction.

By Staff -December 4, 2019


Mg-Magazine Best-Companies-To-Work-For-2019

mg Magazine’s second annual Top Employers report celebrates exceptional workplaces and the people behind them. Each year, during a long, exacting process, hundreds of nominations are painstakingly reviewed to single out the best and brightest the cannabis industry has to offer. To be eligible, companies must have participated in the industry for more than one year, be headquartered in the United States or have a U.S. divisional headquarters, and employ a minimum of ten full-time staff members. Finalists are chosen based on a number of factors including employee satisfaction, benefits and perks, company culture, social responsibility, and charitable giving.

This year’s competition was a close race with finalists boasting a plethora of exceptional characteristics. The honorees span every facet of the industry, with 32 percent whose primary business lies in cultivation and horticulture, 30 percent in product manufacturing, 14 percent in technology, 8 percent in science and labs, 6 percent in media, 2 percent in retailing, and the remaining 8 percent in ancillary services and other categories. The range of finalists’ longevity increased dramatically over 2018 numbers with the emergence of seasoned mainstream businesses entering the market; one company was founded in 1943. Also noteworthy and indicative of the industry’s maturation: 24 percent of honorees are publicly traded, with many offering stock options within their benefits packages.


The cannabis industry has seen a great number of successes and a fair amount of strife since its inception, but perhaps the most challenging obstacle it has faced to date is the e-cigarette or vaping product use associated lung injury (EVALI) epidemic that began spreading in summer 2019. An immediate—and uncharacteristically rash—response from Centers for Disease Control and Prevention warned the public vaping could be dangerous and to avoid all vaping devices, regardless their origin. The action has had a devastating financial impact on the entire industry, resulting in large-scale layoffs. Several companies initially qualified for this year’s list, but the unforeseen consequences of the EVALI outbreak resulted in their disqualification. We sympathize with these businesses and are optimistic they will recover soon and be back in the rankings again next year.

The following fifty companies represent the best of cannabis employers. They understand our industry must rise to meet the demands of mainstream corporate culture while maintaining the spirit, goodwill, and compassion sewn into the heritage of American cannabis.

To them, we tip our hats.

4Front Ventures
HQ: Phoenix
Founded: 2011
Employees: 100+
Job Openings: 20+
Paid Education: Yes

Attracting and retaining talent is a top priority at this publicly traded company and “doing so starts with paying [its] employees living wages.” Regular checkups are conducted to ensure salaries remain on par with “similarly situated positions in other industries.” On top of fair pay, the company covers 100 percent of its staff’s health and life insurance premiums, provides paid training, offers a 50-percent product discount in its retail stores, and encourages career growth.

Advanced Nutrients
HQ: Los Angeles
Founded: 1999
Employees: 100+
Job Openings: 11-20
Paid Education: Yes

In addition to medical and dental insurance and a 401(k) retirement plan, Advanced Nutrients provides catered meals, unlimited daily coffee and snack service, ergonomic workstations, subsidized gym memberships, team outings, special reward programs, and complimentary products. The company is developing a program to teach team members how to grow and nurture their own cannabis. Its Humanity Heroes initiative annually provides hundreds of thousands of dollars in assistance to the homeless in and around Los Angeles.

Akerna (formerly MJ Freeway)
HQ: Denver
Founded: 2010
Employees: 100+
Job Openings: 6-10
Paid Education: No

Publicly traded Akerna pays 100 percent of employees’ medical, dental, and vision insurance in addition to offering more than fifteen vacation days per year and flex-time schedules to encourage work/life balance. A collaborative corporate culture is heavily influenced by an initiative aimed at empowering women in the workplace. The One Woman Challenge, launched inside and outside the industry, encourages mentoring women, and the company’s C-suite team devotes significant time to the endeavor.

Anresco-200 web MGmagazine-wm-1
Anresco Laboratories
HQ: San Francisco
Founded: 1943
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Family owned and operated since its founding in 1943, Anresco extended its services to cannabis in 2017. With tenured benefits like a one-year retention bonus, semi-annual performance reviews and bonuses, and increasing paid time off based on years of service, loyalty is key—especially since the company “promotes almost exclusively from within.” Employees enjoy 100-percent covered Kaiser health plans, dental and vision reimbursement, daily breakfast and snacks, monthly lunches, and nine paid holidays yearly.

Apeks Supercritical
HQ: Johnstown, Ohio
Founded: 2001
Employees: 26-50
Job Openings: 1-5
Paid Education: Yes

An atmosphere of transparency “helps foster a sense of commitment and camaraderie” throughout this company, where monthly employee meetings keep everyone abreast of pertinent information like financials, the state of the company, future plans, and product innovations. The company hosts an annual gift drive for the American Legion and supports local charities and animal rescue organizations. Rewards are given to peer-nominated employees for going “above and beyond their job description.”

Baked-Bros-Top-50-Cannabis-Employers-mg-magazine-wm-1
Baked Bros
HQ: Phoenix
Founded: 2014
Employees: 26-50
Job Openings: 6-10
Paid Education: Yes

Employees tout the company’s culture of personal betterment and professional development, “founders [who] have a true passion for the community,” and a company-wide drive to “change the negative stigma surrounding cannabis.” Each month the team makes sandwiches and personal hygiene packs for Change Society’s #LunchBag program and delivers them to those in need. Perks like team meals, group activities, concert tickets, and product discounts combined with benefits like paid training and self-help workshops add to employee satisfaction.

BDS Analytics Inc.
HQ: Boulder, Colo.
Founded: 2014
Employees: 51-100
Job Openings: 6-10
Paid Education: Yes

Despite mainstream benefits like 100-percent paid medical, dental, vision, life, and disability insurance; company-matched 401(k) with immediate vesting; stock options; and fifteen days paid time off annually, employees say they feel empowered by an atmosphere they consider more startup than corporate. Onsite classes including yoga and dispensary discounts are plusses. Volunteerism and community outreach include feeding the hungry and other organized acitivites in the greater Boulder/Denver area along with mentoring local students and graduates.

Bloom Farms
HQ: Oakland, Calif.
Founded: 2014
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Nationally recognized for social and environmental responsibility, Bloom Farms is driven by two core values: “give something amazing back” and “be good to everyone, including yourself.” Among its many charitable programs, BF provides a healthy meal to a needy individual for each of its products sold. The company boasts a diverse, inclusive culture and offers a standard health benefits package as well as unlimited paid time off, performance bonuses, tuition reimbursement, and stock options.

2018-Boveda-Holiday-Party-Staff web MGmagazine-wm-1
Boveda Inc.
HQ: Minnetonka, Minn.
Founded: 1997
Employees: 26-50
Job Openings: 1-5
Paid Education: Yes

A commitment to breaking the cycle of poverty, hunger, and addiction heavily informs the company’s culture and financial generosity. Boveda offers flexible work schedules, bonus paid time off during holiday weeks, 401(k) matching after six months, a $75 monthly phone allowance, and contributions toward health insurance premiums. Afternoon happy hours are frequent, as are onsite barbeques, potluck lunches, and educational “lunch-and-learns.” The company’s family-like environment is reflected in showers for new “Boveda babies.”

Caliva Lab web MGmagazine-wm-1
Caliva
HQ: San Jose, Calif.
Founded: 2015
Employees: 100+
Job Openings: 20+
Paid Education: Yes

Founded on the tenet “happy plants make happy people,” Caliva’s team comprises passionate, happy employees who strive to bring the power of plants to customers and community. As part of its commitment to social equity, the company supports the Clear My Record program and local initiatives that empower communities and champion the rights of children and families. Staff enjoys product discounts, quarterly swag giveaways, an employee referral program, dog-friendly corporate offices, and stock options.

Canndescent
HQ: Santa Barbara, Calif.
Founded: 2015
Employees: 100+
Job Openings: 6-10
Paid Education: Yes

In a “fun-oriented culture” with opportunities for learning and growth—45 percent of employees earn promotions within their first six months—Canndescent says its people make the company special. Staff receives a comprehensive perks and benefits package that includes a monthly stipend toward medical costs; 100-percent covered premiums for dental, vision, and life insurance; equity in the company; product and gym membership discounts; and a 401(k) plan.

Cova Software
HQ: Denver
Founded: 2016
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Among the most expansive benefits and charitable giving programs on this list: Each employee is provided one paid-time-off day per quarter to volunteer, company retreats include “giveback days” in exotic locations, and fund drives receive matching donations. An innovative “buy your own birthday” time-off program costs participating employees $50, which is donated to Free the Children. In addition to benefits including flex time and stock options are bereavement leave and six months of new-parent leave at 70-percent salary.

Cresco Labs
HQ: Chicago
Founded: 2013
Employees: 100+
Job Openings: 20+
Paid Education: No

Competitive pay, a comprehensive benefits package including 401(k), stock options, and more than fifteen days PTO yearly paired with perks like casual dress code, flexible schedules, daily lunch stipends, and ergonomic workstations attract top-notch leadership from Fortune 500 companies to publicly traded Cresco Labs. Staff is compensated six days yearly for time spent doing volunteer work, and Cresco’s new Social Equity and Educational Development (SEED) program aids those negatively impacted by the war on drugs.

Curaleaf
HQ: Wakefield, Mass.
Founded: 2010
Employees: 100+
Job Openings: 20+
Paid Education: Yes

Curaleaf is the largest pure-play cannabis company in the United States with more than twenty locations nationwide, employing more than 200 full- and part-time employees. Benefits and perks vary by location. Committed to the betterment of the communities in which its entities are located, the company leads local food drives and blood drives, supports schools by paying off students’ lunch bills and installing vape detectors, and donates to local veterans’ organizations.

Flowhub
HQ: Denver
Founded: 2015
Employees: 51-100
Job Openings: 6-10
Paid Education: No

Core values—honesty, transparency, and inclusivity—drive the culture at Flowhub. From the C-suite down, “all voices matter.” The company encourages sharing ideas and considers collaboration essential. To ensure its open environment endures, a “culture committee” is tasked with maintaining the cultural core as the company grows. Perks include an equity program, new-hire happy hours, dog-friendly offices, flexible schedules, and free coffee, beer, and kombucha on tap.

ForceBrands
HQ: New York
Founded: 2007
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

A long-established job placement company with divisions in several industries, ForceBrands’s HerbForce is its newest branch. While the company takes pride in its employee retreats and unique team events, corporate emphasis falls on the “overall employee experience and how everything from career growth and management training to succession plans and flexible working hours come together to create a positive and productive environment.” Health and dental insurance are provided.

Future State Brands
HQ: Culver City, Calif.
Founded: 2014
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Work-life balance is a top priority at Future State Brands, where employees are afforded unlimited paid time off. Management expects staff to take a least two weeks off annually, one at Christmas when the office closes down completely. Elevan paid holidays plus several half days make a total of at least thirty days PTO annually. Additional perks include company-paid continuing education, equity in the company, and a performance incentive plan that provides additional annual grants.

Green Bits
HQ: San Jose, Calif.
Founded: 2014
Employees: 100+
Job Openings: 1-5
Paid Education: Yes

Green Bits offers a range of benefits and perks including telecommuting, unlimited paid time off, dog-friendly offices, and free beer and snacks. The company sponsors community-wide volunteer days and fundraisers at both its office locations, encourages employee growth inside and outside the office, and offers “programs and events aimed at employee and community elevation, and fun offsite [activities] as a way to say ‘thank you.’”

Green Peak Innovations
HQ: Dimondale, Mich.
Founded: 2016
Employees: 100+
Job Openings: 11-20
Paid Education: Yes

An impressive list of benefits and perks illustrates a culture “where employees are engaged, celebrated, and taken care of.” In addition to the basics, the company provides short-term disability and life insurance, a 401(k) program, bonus incentives, and all required uniforms and shoes. Monthly staff lunches; regular outings, harvest celebrations, and holiday parties; and two paid days per year to volunteer or provide community service round out the package.

Green-Thumb-Industries-GTI-mg-magazine-wm-1
Green Thumb Industries
HQ: Chicago
Founded: 2014
Employees: 100+
Job Openings: 20+
Paid Education: Yes

Publicly traded GTI stands out because of a large commitment to social causes. Monthly Inspire Impact days see the entire staff volunteering for causes including Special Olympics, suicide prevention, Walk for Hunger, My Block My Hood My City, blood drives, cleanup projects, veterans organizations, animal shelters, breast cancer awareness, and LGBT organizations. Perks including twice-monthly happy hours, offsite events, and generous time-off policies are among employee favorites.

Greenlane
HQ: Boca Raton, Fla.
Founded: 2005
Employees: 100+
Job Openings: 11-20
Paid Education: Yes

Employees enjoy health insurance, dental insurance, 401(k) with match, and a promote-from-within policy. Healthy meals and snacks are made daily on the premises, and two company-wide events per year feature food, giveaways, and concert-style live entertainment. Multiple charitable projects and a mandatory recycling program demonstrate commitment to the community and planetary health. Tuition assistance, quarterly company-wide meetings, team-building exercises, and weekly coaching sessions are part of the company’s training and development program.

Honest Paws
HQ: League City, Texas
Founded: 2017
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

For a company headquartered in a cannabis-averse state, Honest Paws impresses with a work-at-home policy, unlimited paid time off, promotions from within, and opportunities to transfer to divisions in U.S. territories and on other continents. Everyone from the CEO down wears multiple hats, providing ample opportunity for personal and professional development. The company is committed to environmental protection, along with diversity and workplace equality, and in 2020 will launch a foundation devoted to animal welfare.

Indus-Holdings-mg-magazine-wm-1
Indus Holdings Inc.
HQ: Salinas, Calif.
Founded: 2014
Employees: 100+
Job Openings: 6-10
Paid Education: Yes

The publicly traded company provides its 300 employees with health and dental insurance, paid educational opportunities, and a 50-percent discount on its brands. “Indus is committed to supporting the communities in which its employees live and work”; consequently, the company invests in, and encourages employee volunteerism at, charities and causes including Boys & Girls Club, Mixed Roots Foundation, Rancho Cielo, AIM for Mental Health, and the Workforce Investment Board for Monterey County.

Island Cannabis Co.
HQ: Redondo Beach, Calif.
Founded: 2014
Employees: 51-100
Job Openings: 6-10
Paid Education: Yes

Island describes itself as a “for-benefit” instead of “for-profit” company because it “wants to leave this world a better place.” It actively supports organizations focused on positive social change with charitable giving, team engagement, and organized volunteerism. In addition to providing health, dental, and vision insurance; paid education; a fully loaded kitchen; and indoor and outdoor workspaces, the company encourages work/life balance with frequent staff get-togethers and unlimited paid time off.

Jupiter Research
HQ: Phoenix
Founded: 2015
Employees: 26-50
Job Openings: 1-5
Paid Education: Yes

In addition to standard benefits, publicly traded Jupiter provides financial bonuses plus career education, training, and advancement opportunities to encourage long-term employment. The company hosts holiday parties, team outings to sporting events, competitive fantasy football, a stocked kitchen, and monthly happy hours. Hydraulic desks in an open workspace with abundant natural light serve employee health. The company contributes to annual water and toy drives to benefit underprivileged area residents.

KCSA Strategic Communications
HQ: New York
Founded: 1969
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

In addition to health and dental insurance, KCSA offers birthdays off, a flexible work-from-home policy, and paid days off to perform community service. Other perks include discounted gym memberships, a metro transit commuter benefit program, and team outings like cocktail hours, movie nights in the park, boat cruises, and baseball games. This year, the firm kicked off its social responsibility efforts with a company-wide day of service at a New York City food kitchen.

Kikoko
HQ: Emeryville, Calif.
Founded: 2015
Employees: 26-50
Job Openings: 1-5
Paid Education: Yes

Kikoko provides four-plus weeks of paid time off annually, life insurance, a stipend for acupuncture and chiropractic care, onsite yoga classes, and gym memberships. The company employs fair-trade ingredients and 100-percent recyclable or compostable packaging, in addition to donating 20 percent of net profits to criminal justice reform. Fair pay and quarterly “town hall” meetings, along with bi-annual, mandatory diversity and sexual-harassment-prevention training, contribute to an equitable, safe, and respectful workplace.

Kiva Confections
HQ: Oakland, Calif.
Founded: 2010
Employees: 100+
Job Openings: 20+
Paid Education: Yes

Kiva’s family-oriented culture is supported by generous paid-time-off and educational policies, a fully stocked kitchen, free products and company-hosted meals monthly, family picnics and holiday parties, fully paid maternity and paternity leave, and a nursing mothers perk program. The company supports diversity and empowerment with inclusive hiring practices, donations to LGBTQ+ charities, and funding for local equity programs. A “talent infusion strategist” and safety-and-training manager contribute to career development.

Koi CBD
HQ: Norwalk, Calif.
Founded: 2015
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Koi’s Create Better Days program provides insurance and a generous paid-time-off policy in addition to a 401(k) program; quarterly company outings; birthday celebrations; use of a company recreational vehicle and vacation home; free meals; vehicles, phones, laptops, and gas cards; rewards for sales performance; and weekly professional-training and personal-development classes. A portion of pet products sales goes to animal rescue organizations, and the company sponsors benefit programs for military families.

Leafly-pup-mg-magazine-wm-1
Leafly
HQ: Seattle
Founded: 2010
Employees: 100+
Job Openings: 11-20
Paid Education: Yes

“A career at Leafly combines the excitement of a startup, the social purpose of a non-profit, and the growth opportunities of a major corporation,” according to one employee. Benefits include unlimited paid time off, 3.5-percent 401(k) match, biweekly free lunches, maternity and paternity leave, cellphone allowance, two-to-one commuter transit benefit, and company-paid life insurance. The corporate headquarters’ commitment to environmental sustainability includes elimination of plastic bottles, energy-efficient appliances, and a composting program.

Lowell Herb Co.
HQ: Los Angeles
Founded: 2017
Employees: 100+
Job Openings: 11-20
Paid Education: No

A dog-friendly workplace, a kitchen stocked with healthy snacks, company parties, and unlimited vacation time top the list of perks at Lowell. The company’s social equity and reparative justice programs stand out because they give special employment consideration to recently pardoned, non-violent cannabis offenders and offer a wide spectrum of resources to individuals hoping to enter the cannabis space. Lowell pays farmers a living wage and maintains a family-like culture in the corporate office.

MATTIO Communications
HQ: New York
Founded: 2004
Employees: 11-25
Job Openings: 1-5
Paid Education: Yes

The Mattio staff, 73 percent of whom are women, describe the company as a tight-knit family with values based on trust and integrity. Perks include paid educational opportunities, gym membership, lunch-and-learn events, staff retreats, flexible schedules, a work-from-home policy, unlimited paid time off, and an employee equity program. Health and dental insurance are provided. The company is a founding donor to the Last Prisoner Project and supports Athletes for CARE.

Medically Correct
HQ: Denver
Founded: 2010
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Low turnover rates and dedication to internal promotions and career advancement foster employee loyalty at Medically Correct. With both national and international expansions ongoing, team members have opportunities to relocate and help build the company’s newest divisions. Employees cite positive incentives such as a “welcoming and open work environment,” monthly staff meals, a 401(k) program, and discounted product pricing among favorite perks.

Medicine-Man-Top-50-Cannabis-Employers-mg-magazine-wm-1
Medicine Man
HQ: Denver
Founded: 2009
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Publicly traded Medicine Man contributes to life insurance and identity-protection programs. Employees earn paid time off for up to sixteen hours of volunteer work plus as many as 160 hours of vacation annually and receive a $1,000 bonus on their five-year anniversary. A corporate foundation donates to domestic violence prevention programs, housing for the homeless, groceries and home improvements for seniors, and food drives, and provides museum tickets and school supplies for underprivileged children.

Mile High Labs
HQ: Broomfield, Colo.
Founded: 2016
Employees: 100+
Job Openings: 6-10
Paid Education: No

Mile High team members say their co-workers are “fun to be around,” attesting to the company’s laid-back-but-professional culture. A collaborative environment encourages innovation and empowerment, and the company promotes from within. Employees enjoy easy access to leadership, thanks to an open-door policy and an office design that houses executives among the rest of the team. Favorite perks include transportation reimbursement, a casual dress code, flexible schedules, and multiple annual parties.

Native-Roots-Top-50-Cannabis-Companies-mg-magazine-wm-1
Native Roots Colorado
HQ: Denver
Founded: 2009
Employees: 100+
Job Openings: 20+
Paid Education: Yes

In addition to health, dental, and vision insurance, the company provides long-term disability and $10,000 life insurance and a confidential employee assistance program. Family-oriented, company-wide events, quarterly team-building activities, flexible working hours, discounts on retail merchandise, and a dog-friendly workplace are popular perks. Since 2017, the team has performed more than 1,300 hours of hands-on volunteer work and contributed more than $100,000 to local organizations devoted to medical, youth abuse prevention, and hunger causes.

Nectar Cannabis
HQ: Portland, Ore.
Founded: 2013
Employees: 100+
Job Openings: 1-5
Paid Education: Yes

As part of its mission “to create a new kind of industry culture,” Nectar embraces diversity and promotes from within in addition to offering standard benefits plus a confidential employee assistance program, employee discounts, paid birthday time off, merit-based raises, financial support for continuing education and professional certifications, and flexible scheduling. The company encourages work/life balance with weekly team events including bowling and laser tag, in addition to holiday parties.

NorCal-Cannabis-Company-Trim-Room-mg-magazine-wm-1
NorCal Cannabis Company
HQ: San Francisco
Founded: 2014
Employees: 100+
Job Openings: 11-20
Paid Education: Yes

NorCal offers standard benefits and extensive social-impact and corporate-responsibility programs. Cannabis for Good and Pass It Forward support homelessness reduction, environmental efforts, and job training programs. The company also provides grants to communities and individuals harmed by the war on drugs and offers a mentorship program for underrepresented groups. NorCal annually awards $500 stipends to ten employees who may apply the funds to college or post-secondary education expenses.

Papa & Barkley
HQ: Eureka, Calif.
Founded: 2016
Employees: 100+
Job Openings: 6-10
Paid Education: Yes

In addition to health, dental, and vision care, P&B provides accidental death and dismemberment coverage and life insurance, a 401(k) program, corporate retreats, team-building outings, complimentary meals, gym membership, and tickets to conferences, tradeshows, and Cannabis Cups. One in six employees is on a management track thanks to mentorship and training programs. Teams engage in monthly volunteerism with food banks, museums, and programs that benefit farmers; the company sponsors more than 100 community events nationwide per month.

Platinum-mg-magazine-wm-1
Platinum
HQ: San Diego
Founded: 2014
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Father-and-son team George and Cody Sadler founded Platinum with the goal of supporting people on its team and in its communities. Staff receive equitable pay and standard benefits plus meals, retreats, and swag. The REACT social-equity program donates a portion of sales to employee-endorsed charities focused on issues including suicide prevention, veteran support, world hunger, animal rescue, breast cancer awareness, and pediatric medical care. The program highlights a different charity each month.

Puffco-mg-magazine-wm-1
Puffco
HQ: Los Angeles
Founded: 2013
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Puffco provides a 401(k), a free holistic wellness program including dietary guidance and personal strength training, an onsite café, company retreats, and special events, all in a dog-friendly workplace. The collaborative environment encourages diversity in thought and belief and fosters shared responsibility, excitement, experimentation, and camaraderie. The company regularly donates a percentage of profits to community causes and hosts events that “bring communities together in a safe space.”

SC Labs
HQ: Santa Cruz, Calif.
Founded: 2010
Employees: 51-100
Job Openings: 1-5
Paid Education: No

Competitive pay and a collaborative environment that rewards employees’ views and ideas are top-of-the-list for many at this company. Competitive salaries, 401(k) matching, paid health benefits and retirement plan, free snacks and drinks, company dinners and entertainment outings, ergonomic office furniture, top-of-the-line computer equipment, flexible scheduling, monthly birthday celebrations, and company swag are among the perks and benefits employees tout. The company’s primary cause is beach clean-up.

springbig
HQ: Boca Raton, Fla.
Founded: 2014
Employees: 26-50
Job Openings: 1-5
Paid Education: Yes

Among the extras here are unlimited paid time off; maternity, paternity, and family leave; 401(k) matching; weekly group activities like yoga, meditation, office Olympics, and trivia nights; rec-league sports; weekly group lunches; holiday parties with corporate gifts; work-from-home policy; very casual dress code; and an outdoor work area. Fifty percent of management is female, and the company promotes from within. The office is mostly paperless, and employees are encouraged to use public transportation.

Treez
HQ: Oakland, Calif.
Founded: 2015
Employees: 26-50
Job Openings: 6-10
Paid Education: Yes

With core principles of knowledge, education, innovation, and pragmatism, “Treez has a fun, open, and infectious company culture” offering competitive compensation packages plus unlimited vacation, equity, work-from-home hours, and team events like happy hours, company outings, and professional sporting events. Employees value the opportunity for upward mobility, and the company helps create opportunities for non-violent victims of the war on drugs by contributing to clemency projects.

Vangst
HQ: Denver
Founded: 2016
Employees: 51-100
Job Openings: 11-20
Paid Education: Yes

“At Vangst, we know we need to get sh*t done, build upon our internal relationships, foster an inclusive environment, and always think bigger.” The company puts that mantra into action with an onsite gym and sauna, monthly lunch-and-learns, unlimited paid time off, a dog-friendly office, offsite team-building activities, and a casual dress code. Vangst partners with advocates, community-based organizations, and municipalities to address injustices of the war on drugs, support equal access, and create economic empowerment.

Vicente Sederberg LLP
HQ: Denver
Founded: 2010
Employees: 51-100
Job Openings: 6-10
Paid Education: Yes

Competitive salaries and a benefits package including 100-percent employer-paid medical, dental, and vision insurance for employees and their dependents, plus life, short-term and long-term disability for employees; a 401(k) plan with matching; generous paid time off; paid parental leave; fitness membership reimbursement; lunches and retreats; and a dog-friendly workplace are a few of the perks here. The firm contributes both time and money to social justice causes including drug policy reform and the rights of marginalized groups.

Vireo Health Inc.
HQ: Minneapolis
Founded: 2014
Employees: 100+
Job Openings: 11-20
Paid Education: Yes

Publicly traded Vireo gives new employees three to four weeks paid time off immediately upon hiring. A flexible work-from-home policy; quarterly “all-hands meetings” comprising two days of strategic meetings, team-building, and events; a 401(k) program; and monthly innovation meetings during which employees pitch leadership their ideas for new products, services, and processes are favorite perks here. The company prioritizes gender and ethnic diversity, employs solar power at its cultivation facilities, composts all leftover plant matter, and enforces in-office recycling.

Wana Brands
HQ: Boulder, Colo.
Founded: 2010
Employees: 51-100
Job Openings: 1-5
Paid Education: Yes

Wana Brands’ mission to “enhance life” guides its corporate culture, which places a premium on respect and camaraderie. The company provides tuition and continuing education reimbursement, up to sixteen hours of paid volunteer time annually, monthly social events, discounted YMCA memberships, and complimentary bus passes. Promotions from within and a robust bonus plan are favorite perks. A corporate social responsibility program in 2019 completed 500 volunteer hours working with organizations that address issues like food insecurity and domestic violence.

Würk
HQ: Denver
Founded: 2015
Employees: 51-100
Job Openings: 11-20
Paid Education: Yes

“Würk looks for people who share ideas, collaborate, and present unique solutions.” Health, dental, and vision insurance; parental leave; equity; sabbaticals; unlimited paid time off; cellphone reimbursement; and a dog-friendly workplace are top benefits cited by employees. The company’s open environment fosters growth and creativity and makes it easy to connect with team members to collaborate on projects, support one another, celebrate successes, and share failures, they say.

Yerba Buena
HQ: Hillsboro, Ore.
Founded: 2015
Employees: 11-25
Job Openings: 1-5
Paid Education: Yes

Yerba Buena pays 100 percent of employees’ health, vision, and dental insurance premiums, plus provides bereavement and maternity/paternity leave as well as bimonthly “wellness days.” A robust training program, including outside educational opportunities, is available to all team members. The company takes an aggressive approach to sustainability, employing LEDs and drip systems throughout its facilities, collecting runoff, composting green and food waste, and recycling and upcycling. Volunteerism includes planting trees, adopting parks and highways, and Habitat for Humanity.

Honorable Mentions
A handful of companies barely missed the list but earned our respect and deserve an honorable mention.

Anthea
HQ: Fort Collins, Colo. | Founded: 2017 | Employees: 26-50

CannaCraft, Inc.
HQ: Santa Rosa, Calif. | Founded: 2014 | Employees: 100+

Eaze-Top-50-Cannabis-Employers
Eaze, Inc.
HQ: San Francisco | Founded: 2014 | Employees: 100+

Flow Kana
HQ: Oakland, Calif. | Founded: 2014 | Employees: 100+

General Cannabis Corp.
HQ: Denver | Founded: 2013 | Employees: 100+

Harvest Health & Recreation, Inc.
HQ: Tempe, Ariz. | Founded: 2011 | Employees: 100+

Hypur
HQ: Scottsdale, Ariz. | Founded: 2014 | Employees: 26-50

IAnthus Capital Holdings
HQ: New York | Founded: 2013 | Employees: 100+

LivWell Enlightened Health
HQ: Denver | Founded: 2009 | Employees: 100+

PAX Labs
HQ: San Francisco | Founded: 2017 | Employees: 100+

Phylos Bioscience
HQ: Portland, Ore. | Founded: 2014 | Employees: 50-100

Sweet Grass Kitchen
HQ: Denver | Founded: 2009 | Employees: 26-50

[FUNMAN]

Cannabis vapes coming to Alberta dispensaries this month

BRODIE THOMAS
Updated: February 9, 2020

https://calgaryherald.com/news/cannabis-vapes-coming-to-alberta-dispensaries-this-month

The Alberta government quietly informed cannabis retailers late Friday vape cartridges will be available for order starting Monday.

The decision comes a little over one month after the province put a hold on releasing the cartridges, saying it wanted to review the safety of the products.

Cannabis vape cartridges are already legally available in other provinces, and they’re easily obtainable on the black market, according to cannabis retailers.

Heather Holmen, communications manager for Alberta Gaming, Liquor and Cannabis, confirmed an email went out to retailers on Friday alerting them that cannabis vape cartridge products would be on their weekly order forms starting on Monday.

It could take up to another week for the orders to be filled and shipped to stores, but she expects to see them in brick-and-mortar retail shops in the next few weeks.

“Government reviewed the available evidence, data and other provinces’ decisions on cannabis vaping and determined that Alberta will allow for the sale of cannabis vapes,” said Holmen.

“From a government perspective, it was important to review the evidence that was available and ensure that the decisions was made in the best interest of Albertans.”

She said the Alberta government and AGLC will continue to monitor the products and the available evidence to ensure the continued health and safety of Albertans.

Colten Mertz, district manager with Urban Canna, said he was surprised to see the email from the AGLC Friday evening.

“I was not expecting it in the near future at all,” he said. “I was under the impression that it got roped in with the tobacco vape review.”

Postmedia requested an interview with the Treasury Board and Finance ministry, the government department responsible for the review, but did not receive a response by deadline.

Mertz said given the number of people asking for vape products, he’s hopeful he’ll be able to satisfy more customers instead of having them leave his stores empty-handed.

But at the same time, he’s worried about competition from the black market.

“They didn’t give us any information on what they’d be taxing us,” said Mertz. “For instance in B.C. they have a 20 per cent vape tax.”

He said that means a half-gram legal vape cartridge in B.C. can cost about $100 with taxes, while a full-gram vape cartridge can be purchased on the black market for about half the cost.

Brittany Smith, a supervisor at Queen of Bud, explained vape cartridges will have about 100 to 200 “pulls” on them. An entire cartridge could have upwards of 1,000 milligrams of THC in it.

“From what I’ve seen from other licensed producers that have come in to show us their product, most of them are sitting around the 400 to 600 milligram (per cartridge) range.”

Edibles, by comparison, have a 10 milligram of TCH per package limit.

She said unlike edibles, which can take an hour to 90 minutes for their effects to become apparent, vapes are just like smoking. Anyone using a vape should begin to feel the effects in under a minute.

She said they will be advising vapers to go low and slow when they first try vaping cannabis.

“Have maybe one or two pulls off that cartridge and see how you feel after five or 10 minutes. And then have a little bit extra afterwards.”

The other benefit of vaping, she said, is the lack of a strong smell.

“They’re a little bit more discreet. It makes it easier to not have that smell if you’re in an apartment building,” said Smith.

With files from Bill Kaufmann

[FUNMAN]

Fire & Flower Holdings (FFLWF) Gets a Buy Rating from Echelon Wealth Partners

Austin Angelo- February 12, 2020, 10:01 AM EDT

https://www.smarteranalyst.com/new-blurbs/fire-flower-holdings-fflwf-gets-a-buy-rating-from-echelon-wealth-partners/

Echelon Wealth Partners analyst Matthew Pallotta maintained a Buy rating on Fire & Flower Holdings (FFLWF) yesterday and set a price target of C$2.10. The company’s shares closed last Monday at $0.60, close to its 52-week low of $0.56.

According to TipRanks.com, Pallotta ‘s ranking currently consits of no stars on a 0-5 ranking scale, with an average return of -19.4% and a 5.6% success rate. Pallotta covers the Healthcare sector, focusing on stocks such as iAnthus Capital Holdings, Green Thumb Industries, and Trulieve Cannabis.

Fire & Flower Holdings has an analyst consensus of Strong Buy, with a price target consensus of $1.86, representing a 234.5% upside. In a report issued on January 27, Stifel Nicolaus also maintained a Buy rating on the stock with a C$2.25 price target.

[FUNMAN]

Cannabis retailer preparing to open store on Stone Road

https://www.guelphtoday.com/local-news/cannabis-retailer-preparing-to-open-store-on-stoned-road-2088290

[FUNMAN]

Here’s what could drive Fire and Flower stock higher: Echelon

FEBRUARY 13, 2020
BY NICK WADDELL

This may be very interesting. See blue. This is what I hoped for from the very beginning. We want Couche-Tard to own 50.1% of the company. - FUNMAN

https://www.cantechletter.com/2020/02/heres-what-could-drive-fire-and-flower-stock-higher-echelon/

Echelon Wealth Partners analyst Matthew Pallotta is staying bullish on Fire & Flower Holdings (Fire and Flower Stock Quote, Chart, News TSX:FAF) after the cannabis retailer announced the forced conversion of some of its convertible debentures.

In an update to clients on Tuesday, Pallotta maintained his “Speculative Buy” rating and $2.10 price target, which at press time represented a projected 12-month return of 166 per cent.

Edmonton-based Fire and Flower on Tuesday said it has agreed with debtholders to amended terms of its 8.0 per cent unsecured debentures due July 31, 2020, to allow for a forced conversion into common shares at the initial conversion price of $1.15 per share, at about 17.4 million shares in total.

The move will prevent further dilution of equity holders in the company, with the outstanding interest to also be paid in shares at the last closing price, per the terms of the debentures, with the interest savings to the company estimated at about $800,000 as a result of the early conversion.

“Fire & Flower has forced the conversion of debentures to eliminate the interest payments associated with such debentures and the removal of these liabilities from the Company's balance sheet further strengthens Fire & Flower's financial position,” said the company statement.

Pallotta says his model for FAF had already assumed a conversion price of $1.15 per share, and thus, the conversion is already figured into his estimates.

The analyst notes Fire & Flower also has convertible debentures due June 26, 2020, for $27.2 million but the company’s current cash balance isn’t enough to both fund its growth plans and pay back the principal amount of these debentures. And with the conversion feature here currently out of the money, the company has a number of possibles options to pursue.

“We believe the most likely scenarios are as follows,” said Pallotta. “The Company may attempt to renegotiate conversion price of the debentures to a level that is lower than $1.20/shr, dependent on the market at that time; Look to pay down the maturing debentures with proceeds from the issuance of new securities, preferably secured debt (assuming sufficient capital is available at reasonable terms); or Alimentation Couche Tard and the Company may decide to mutually agree on the early conversion of the Couche Tard debentures, allowing Couche Tard to exercise its Tranche A Warrants, for proceeds of $42.9 million, which the Company may then use in part to repay the debentures.”

The analyst said renegotiation remains an option, even at the risk of additional dilution, as the company is likely to want to preserve cash rather than pay down the maturing debentures.

Nevertheless, the third option is a possibility, says Pallotta, and a potential boon for the stock.

“While quite speculative, we also note the possibility that Couche Tard electing to convert its debentures and exercise its Tranche A warrants ahead of the maturity date for the June 2020 convertible debentures could see the stock reprice meaningfully higher (Tranche A warrants are exercised at $1.40), which could put the June 2020 convertible instruments in the money,” Pallotta says.

The analyst hasn’t made changes to his forecast, still calling for fiscal 2020 revenue and adjusted EBITDA of $144.0 million and $5.1 million, respectively.

[FUNMAN]

Fire & Flower will no longer cover its windows, says it promotes theft
After being robbed, the retailer is scrapping its covered windows to promote workplace safety

By: Michelle Gamage

February 21, 2020

11 min

https://mugglehead.com/fire-flower-says-covered-windows-promote-theft/

A security measure in cannabis stores to protect children might actually be putting staff in danger.

The window coverings that block kids from seeing weed products have been facilitating criminals as they rob cannabis retail stores, according to Fire & Flower Holdings Corp. (TSX: FAF).

After a rash of robberies in Edmonton that included one of its own locations, Fire & Flower announced it was scrapping the industry standard window coverings.

The rate of robberies at cannabis retail stores is going up, not down, and that’s being facilitated by the vinyl stickers covering windows, Fire & Flower vice president of government, media and stakeholder relations Nathan Mison told Mugglehead.

“Criminals won’t have the capability of having anonymity and I think that was one of the things that window coverings allowed,” Mison said.



Window coverings violate worker safety, expert says


It’s a strategy that Edmonton police noticed in the recent robberies.

According to their reports, three men would enter a retail store and two men would threaten employees with weapons and demand they hand over cash, cannabis and related items. The third man would guard the door and make sure no one came in and saw what was happening.

Covering store windows violated one of the basic principles of retail safety, says Lara Pinchbeck, an Edmonton designer and researcher of the ways humans interact with their environment.

She’s worked as a private consultant for the City of Edmonton and said one of the best ways to prevent crime is a method called natural surveillance — or being able to see in and out of a store, and knowing you can be seen.

“Those graphics are an excellent screen for whoever breaks into a shop to undertake whatever they need to without being seen,” she said.

Natural surveillance can help protect against more than just robberies. When employees are being harassed or feel uncomfortable their discomfort can be seen by passersby, Pinchbeck said.

The window coverings aren’t just frustrating employees.

When consulting for the City of Edmonton, Pinchbeck said the largest amount of complaints came from police officers and security guards.

“If something is happening in the shop of course no one can see in to be able to know that,” she said. “So when they do their drive by’s they can’t quickly look into a shop to see if something is happening there or not.”



Company says they won’t be violating Cannabis Act

Uncovering its windows doesn’t mean Fire & Flower will be violating the Cannabis Act, Mison said.

The act says retailers must keep cannabis out of the sight of children and youth, “but that doesn’t mean you need to have full window coverings to achieve that end,” he said. “That was a provincial interpretation of the act.”

The company will be analyzing each of its 48 locations in Alberta, Saskatchewan, Manitoba, Ontario and the Yukon starting next week.

As the window coverings come down the store will use product positioning and merchandising to ensure no children can see weed from the street, Mison said.

As well as updating its current stores Fire & Flower will also keep their windows clear as they build out new retail locations. The company is aiming to have 85 stores open by the end of 2020 and 135 stores open by the end of 2021.

The company is planning on working closely with regulators to make sure it adheres to the rules while also keeping staff and customers safe, Mison said.

[FUNMAN]

Cannabis Execs Tackle Branding, Pot Stock Valuations: 'Dispensaries Are The Brand'

By: Natan Ponieman, Benzinga Staff Writer
February 24, 2020 12:40pm
2 min read

https://www.benzinga.com/markets/cannabis/20/02/15395430/cannabis-execs-tackle-branding-pot-stock-valuations-dispensaries-are-the-brand?utm_source=Benzinga+Cannabis+Insider+Newsletter+-+Delivered+Weekly&utm_campaign=577bd1b652-MailChimp_Cannabis_Newsletter&utm_medium=email&utm_term=0_4af33b5f7f-577bd1b652-311122729

No significant brand exists in the cannabis space.

That was the eye-opening statement JW Asset Management President Jason Wild made Monday at the Benzinga Cannabis Capital Conference in Miami Beach.

Wild's rationale: when a brand drops out of any dispensary, the store won't see a change in sales, since consumers are not yet loyal to any particular brands.

“Dispensaries are the brand,” Wild said during a VIP panel that included Vireo Health International Executive Chairman Bruce Linton; Rob Sechrist, Pelorus Equity Group's co-founding president; and Jim Kirsch, senior managing director at Alliance Global Partners.

Agreeing To Disagree On Cannabis Branding

The branding situation in Canada is even more extreme because regulators don’t allow for strong branding differentials in product packaging, Wild said.

The panel joked about how consumers move their cannabis products from their original packaging to the more interesting packaging that came with medical marijuana products before the time of adult-use legalization.

Alliance Global's Kirsch disagreed.

“I’m a firm believer of brands, and I’ve seen the power of brands,” he said.

Yet cannabis is still an emerging market and many brands are striving to become dominant, Kirsch said. He expects the introduction of the beverage industry in the cannabis space to become a major driver of brands in the sector.

Cannabis Industry Outlook For 2020

Panel moderator Tim Seymour, the founder and CIO of Seymour Asset Management, asked the group's opinion on the recent drop in cannabis stock valuations.

The U.S. stock market continues to be the most efficient and transparent market in the world, Kirsch said.

“There’s definitely access to capital, in a rational manner," he said, adding that “the irrational exuberance of the cannabis business has passed.”

For Vireo Health International Inc's (CSE: VREO) Linton, the industry should not be focusing on how cannabis is decelerating, but on how it's moving forward.

Today's low charts are an opportunity to reset and go even faster, said Linton, who is also the executive chairman of Gage Cannabis Co. and the former CEO and co-founder of Canopy Growth Corp and Tweed.

Trying to solve many small problems is much harder than solving one big one, he said.

For this reason, Linton said he advises companies to merge and ally in order to look for solutions together, rather than apart.

Moderator Tim Seymour, left; Rob Sechrist; Bruce Linton; Jason Wild; and Jim Kirsch speak Monday at the Benzinga Cannabis Capital Conference in Miami Beach. Photo by Shelby Jones.

[FUNMAN]

Fire & Flower Maintains Continuity of Business as an Essential Service in Ontario Amid the COVID-19 Crisis and Moves Exclusively to Fastlane Click-and-Collect Service

March 24 2020

https://fireandflower.com/investor-relations?tab=news-releases&release=fire-flower-maintains-continuity-of-business-as-an-essential-service-in-ontario-amid-the-covid-19-crisis-and-moves-exclusively-to-fastlane-click-and-collect-service&utm_source=Cyberimpact&utm_medium=email&utm_campaign=Fire--Flower-Maintains-Continuity-of-Business-as-an-Essential-Service-in-Ontario-Amid-the-COVID-19-Crisis-and-Moves-Exclusively-to-Fastlane-Click-and-Collect-Service

Edmonton, Alberta (March 24, 2020) – Fire & Flower Holdings Corp. (“FFHC”) (TSX: FAF) and its wholly-owned subsidiary Fire & Flower Inc. (“Fire & Flower” or the “Company”), today announced that it anticipates continuous operations of its highest performing retail store locations in Ottawa and Kingston, Ontario. This announcement follows the province of Ontario declaring cannabis retail stores and licensed producers as “essential workplaces”, on March 23, 2020.

Additionally, Fire & Flower stores across its retail network in Alberta, Saskatchewan, Manitoba, Ontario and the Yukon territory will serve customers exclusively through the Spark Perks™ Fastlane™ “click-and-collect” service starting today, Tuesday, March 24, 2020.

Management continues to focus on maintaining continuity of business in other provinces where it operates and is focused on stores situated in key markets to ensure customers have sustained access to Fire & Flower stores.

Fire & Flower is demonstrating leadership in the cannabis retail industry by taking the following measures to help ensure the health and safety of its customers and staff:

* Customer orders exclusively thorough the Fastlane “click-and-collect” service

* Safety shields that create separation between customers and staff members

* Increased and frequent cleaning of all surfaces in retail stores

* Reduction of paper materials including point-of-sale materials

* Cashless transactions by only accepting card-based payments

* Limited numbers of customers permitted entry to stores at any given time and enforcing social distancing between customers

* The Fastlane “click-and-collect” service limits social interactions by creating a digital shopping experience and minimizing customer time in shop, thereby encouraging social distancing and limited physical interaction in Canada’s battle against COVID-19.

“Throughout the unprecedented COVID-19 public health challenge, the Fire & Flower team has continued to respond with the best interests of our customers, employees and the community in mind, and I am humbled to be part of a team that cares so greatly about the success of this Company,” shared Trevor Fencott, Chief Executive Officer of Fire & Flower. “We are very pleased that the province of Ontario has named cannabis retail stores and licensed producers as essential services and congratulate the province in this decision which will help combat the illegal, unregulated cannabis market. This decision will ensure that consumers will have access to safe, legal cannabis. Fire & Flower continues to demonstrate a leadership position in the protection of the health and safety of customers, employees and the public.”

Fire & Flower continues to serve customers in key locations. A list of all Fire & Flower open and operating locations and temporary closures are available on the Company’s website at http://www.fireandflower.com/locations.

The Spark Perks Fastlane “click-and-collect” service is a key feature of the Hifyre™ digital retail platform and has more than 80,000 members across Canada.

About Fire & Flower

Fire & Flower is a leading purpose-built, independent adult-usecannabis retailer poised to capture significant Canadian market share. The Company guides consumers through the complex world of cannabis through education-focused, best-in-class retailing while the HifyreTMdigital platform and Spark PerksTM program connect cannabis consumers with the latest cannabis products, and deliver cutting edge insights into evolving consumer behaviours. The Company’s leadership team combines extensive experience in the cannabis industry with strong capabilities in retail operations.

Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc., a licensed cannabis retailer that owns (directly or directly) cannabis retail store licences in the provinces of Alberta, Saskatchewan, Manitoba and Ontario and the Yukon territory.

Through its strategic investment with Alimentation Couche-Tard Inc. (ATD.A, ATD.B), the Company has set its sights on the global expansion as new cannabis markets emerge.

For More Information Contact:

Investor Relations
[e-mail]
1-833-680-4948

Media Relations
[e-mail]
780-784-8859

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws (“forward-looking statements”). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “achieve”, “could”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “outlook”, “expect”, “project” and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions “may” or “will” occur. These statements are only predictions.

Forward-looking statements are based on the opinions and estimates of management of FFHC at the date the statements are made based on information then available to the Company. Various factors and assumptions are applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Forward-looking statements are subject to and involve a number of known and unknown risks and uncertainties, many of which are beyond the control of FFHC, which may cause FFHC’s actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct.

FFHC assumes no obligation to publicly update or revise forward-looking statements to reflect new information, future events or otherwise, except as expressly required by applicable law.

SOURCE Fire & Flower Holdings Corp.

[FUNMAN]

Fire & Flower Announces $25 Million Private Placements


CNW Group
April 13, 2020


https://finance.yahoo.com/news/fire-flower-announces-25-million-100000086.html


Green Acre Capital acting as Lead Investor

EDMONTON , April 13, 2020 /CNW/ - Fire & Flower Holdings Corp. (TSX: FAF OTCQX: FFLWF) ("FFHC", "Fire & Flower" or the "Company"), today announced two proposed private placements for aggregate gross proceeds of up to $25 million (collectively, the "Offerings").

The Offerings are comprised of (i) a non-brokered private placement of up to 19,800 8.0% secured $1,000 principal amount convertible debentures (the "Convertible Debentures") at a price of $1,000 per Convertible Debenture for aggregate gross proceeds of up to $19.8 million , and (ii) a non-brokered private placement of up to 5,200 subscription receipts (the "Subscription Receipts") at a price of $1,000 per Subscription Receipt for aggregate gross proceeds of up to $5.2 million . Each Subscription Receipt shall be automatically converted into one $1,000 principal amount Convertible Debenture upon the satisfaction of certain escrow release conditions as further described below.

Green Acre Capital ("Green Acre" or "GAC") has committed to act as lead investor in the Offerings. AltaCorp Capital Inc. is acting as exclusive financial advisor to Fire & Flower in connection with the Offerings.

Management Commitment & Participation

Certain directors and officers of the Company have committed to participate in the Offerings for an aggregate investment of $1 million , including an $850,000 commitment by Fire & Flower's Chief Executive Officer.

"These private placements led by Green Acre will strengthen our financial position and enable Fire & Flower to continue to deliver upon our growth plans for cannabis retail stores across Canada ," shared Trevor Fencott , Chief Executive Officer of Fire & Flower. With this capital in place, we are uniquely positioned for success coming out of the current public health crisis and well into the future."

"In current market conditions, it is important to invest in industry leaders. Green Acre is impressed by Fire & Flower's track record of continuing to execute upon its focused strategy towards building a sustainable business in the cannabis sector," shared Shawn Dym , Director with Green Acre Capital LP. "Fire & Flower's clear value proposition as an omni-channel, technology-enabled retail company combined with its deep management expertise demonstrates why Fire & Flower is positioned to lead cannabis retailers in a path to profitability, amidst uncertainty for many cannabis companies."

Strong Balance Sheet Provides Stability

Fire & Flower's strong balance sheet, together with its strategic relationship with Alimentation Couche-Tard Inc. ("ACT"), positions the Company well to continue to deliver upon its national growth strategy.

The proceeds of the Offerings will be used for working capital and other general corporate purposes of the Company and its subsidiaries, including repayment of existing debt that is not converted into shares prior to maturity, and continuing to build the Fire & Flower retail network through expanding into new markets as they emerge.

Debenture and Subscription Receipt Offerings

The Convertible Debentures will bear interest at an annual rate of 8.00% payable in arrears in equal installments semi-annually. The Convertible Debentures will mature on June 1, 2021 , which date will be automatically extended to the date that is 24 months from the closing date in the event certain outstanding securities of FFHC are converted, exercised or otherwise extinguished (the "Maturity Date") as will be further set out in a debenture indenture to be entered into prior to closing of the Offerings. The principal amount of Convertible Debenture will be convertible at the holder's option into common shares of FFHC (the "Conversion Shares") at any time prior to the Maturity Date at a conversion price of $0.50 per Conversion Share. The Company's obligations under the Convertible Debentures will be secured by the assets of the Company and its subsidiaries.

Subject to the approval of the Toronto Stock Exchange (the "TSX"), which pursuant to the TSX policies requires the approval of the shareholders of FFHC, in lieu of paying any interest accrued and payable in respect of the Convertible Debentures up to and including December 31, 2020 (or June 30, 2021 in the event the Maturity Date is extended), FFHC may elect to add such accrued and unpaid interest to the then outstanding principal amount of Convertible Debentures.

The net proceeds of the offering of Subscription Receipts (the "Subscription Receipt Proceeds") will be delivered to and held by a licensed Canadian trust company, in its capacity as subscription receipt agent. Upon the satisfaction and/or waiver of certain escrow release conditions (the "Escrow Release Conditions") each Subscription Receipt will automatically be converted into a $1,000 principal amount Convertible Debenture and the Subscription Receipt Proceeds will be released to FFHC.

The Escrow Release Conditions shall include the Conversion Shares underlying the Convertible Debentures issuable upon conversion of the Subscription Receipts being conditionally approved for listing on the TSX and the completion, satisfaction or waiver of all conditions precedent to such listing, including the receipt of shareholder approval.

The Convertible Debentures, the Subscription Receipts and any underlying securities issued pursuant to the Offerings will be subject to a statutory four month and one day hold period following the closing date.

Closing of the Offerings is expected to occur on or prior to April 30, 2020 and is subject to customary closing conditions, including, without limitation, receipt of all regulatory approvals.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws.

About Fire & Flower
Fire & Flower is a leading purpose-built, independent adult-use cannabis retailer poised to capture significant Canadian market share. The Company guides consumers through the complex world of cannabis through education-focused, best-in-class retailing while the Hifyre™ digital platform connects consumers with cannabis products. The Company's leadership team combines extensive experience in the cannabis industry with strong capabilities in retail operations.

Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc., a licensed cannabis retailer that owns or has interest in cannabis retail store licences in the provinces of Alberta , Saskatchewan , Manitoba and Ontario and the Yukon territory.

Through its strategic investment with Alimentation Couche-Tard Inc. (ATD.A, ATD.B), the Company has set its sights on the global expansion as new cannabis markets emerge.

About Green Acre Capital
Green Acre is a private investment fund that is exclusively dedicated to making cannabis investments globally. GAC has raised in excess of $100 million to deploy across the cannabis value chain. With two current funds GAC is one of the longest tenured and most active private investors in the industry.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws ("forward-looking statements"). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "could", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "project" and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking statements in this news release include statements regarding the terms and closing of the Offerings and the intended use of proceeds of the Offerings.

Forward-looking statements are based on the opinions and estimates of management of FFHC at the date the statements are made based on information then available to FFHC. Various factors and assumptions are applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Forward-looking statements are subject to and involve a number of known and unknown risks and uncertainties, many of which are beyond the control of FFHC, which may cause FFHC's actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct, including when or whether the financing will be completed.

FFHC assumes no obligation to publicly update or revise forward-looking statements to reflect new information, future events or otherwise, except as expressly required by applicable law.

SOURCE Fire & Flower Holdings Corp.

[FUNMAN]

Fire & Flower Announces 2019 Fiscal and Fourth Quarter Financial and Operational Results

April 30 2020

Edmonton, Alberta (April 30, 2020) – Fire & Flower Holdings Corp. (“Fire & Flower” or the “Company”) (TSX: FAF), today announced its financial and operational results for the fifty-two and thirteen-weeks ended

February 1, 2020.

Financial and Operational Highlights for the 2019 Fiscal Year Fifty-two weeks ended February 1, 2020

• Achieved the target of 45 open and operating retail stores ahead of schedule, on January 13, 2020 across the provinces of Alberta, Saskatchewan, Manitoba and Ontario and the Yukon territory.

• Total revenue of $51.1 million at a gross profit of 36.4%, compared to revenue of $13.0 million at a gross profit of 38.4% for the 2018 fiscal year – representing a 294% increase in revenue.

• Closed the strategic investment with Alimentation Couche-Tard Inc. (“Couche-Tard”) with an initial investment of $25.9 million (through 2707031 Ontario Inc., an indirect wholly-owned subsidiary). The strategic investment would result in Couche-Tard obtaining a controlling interest in Fire & Flower if all securities issued in connection with the strategic investment are converted/exercised in full.

• Completed numerous acquisitions relating to cannabis retail stores in British Columbia, Alberta and Saskatchewan.

• Secured more than $27 million of capital through a bought deal private placement financing in June of 2019.

• Hifyre launched the Spark Perks™ member programproviding benefits such as Fastlane “click-and-collect” checkout, exclusive deals and access to member-only events. As of the end of the Company’s fiscal year, the program has enrolled more than 60,000 members.

• Commercialized the Hifyre™ Digital Retail and Analytics Platform producing an independent high margin revenue stream.

• Hifyre entered into a strategic licence agreement with COVA Software Solutions, an industry-leading point of sale company to further commercialize the Hifyre Digital Retail and Analytics Platform across Canada and in international markets.

• Implemented a restructuring plan as part of normal-course retail operations to maximize profitability across the Retail Platform.
Subsequent Financial and Operational Highlights post February 2, 2020

• Maintained business continuity during the COVID-19 public health crisis through rapidly implementing safety operating procedures and the ability to continue to serve customers through the Hifyre Digital Retail and Analytics Platform including the Spark Fastlane™ “click-and-collect” service, curbside pickup and home delivery in select provinces.

• Closed two private placements for aggregate gross proceeds of $28 million with Green Acre Capital LP acting as the lead investor and AltaCorp Capital Inc. acting as the exclusive financial advisor to Fire & Flower in connection with the offerings.

• Entered into a commitment letter with ATB Financial for senior secured credit facilities of up to $10 million with an option to secure an additional $5 million, subject to ATB Financial’s consent and other customary conditions.

• Hifyre’s Spark Perks member program achieved more than 95,000 active members and continues to deliver highly engaged customers across the Fire & Flower Retail Platform

• Forced the conversion of all remaining licensed producer debentures through the issuance of 12,223,638 common shares

Financial Highlights for the Fourth Quarter Thirteen weeks ended February 1, 2020

• Total revenue of $16.8 million at a gross profit of 36.6%, compared to $13.7 million at a gross profit of 34.7%

• An increase in revenue of 18.5% and an increase of 5.2% in gross profit compared to Q3-2019

• Incurred a $6.5 million restructuring charge, primarily related to non-cash write-offs of the assets affected by the Restructuring Plan

• Incurred a $4.6 million impairment charge to write down certain long-term assets to their fair values

“The financial and operational results for our fiscal 2019 year and the fourth quarter demonstrate Fire & Flower’s continued track record of meeting our organizational goals. This includes delivering on our store target of 45 open and operating retail locations by the end of the fiscal year and dramatically growing our sales,” shared Trevor Fencott, Chief Executive Officer of Fire & Flower. “Looking forward to fiscal 2020, our focus will be on optimizing and growing our retail network where the Hifyre Digital Retail and Analytics platform continues to be our competitive advantage. We will focus on addressable markets and participating in those markets in a meaningful and accretive fashion to our business.”

To see the following chart, click here:

https://fireandflower.com/investor-relations?tab=news-releases&release=fire-flower-announces-2019-fiscal-and-fourth-quarter-financial-and-operational-results&utm_source=Cyberimpact&utm_medium=email&utm_campaign=Fire--Flower-Announces-2019-Fiscal-and-Fourth-Quarter-Financial-and-Operational-Results

Selected Summary of Financial Results

NM – Not Meaningful

During the fifty-two weeks ended February 1, 2020, the Company generated revenue of $51.1 million including sales of $42.9 million in the Retail Platform, $5.6 million in the Distribution Platform and sales of $2.6 million in the Digital Retail and Analytics Platform.

During the thirteen weeks ended February 1, 2020, the Company generated revenue of $16.8 million including sales of $13.7 million in the Retail Platform, $2.1 million in the Distribution Platform and sales of $1.0 million in the Digital Retail and Analytics Platform.

Total gross profit for the fifty-two weeks ended February 1, 2020 was $18.6 million or 36.4% of revenue with retail and wholesale operations delivering $16.0 million, or 33.0%, gross profit, compared to $5.0 million with retail and wholesale operations delivering $4.5 million, or 35.7% of gross profit for the fifty-two weeks ended February 2, 2019.

Total gross profit for the thirteen weeks ended February 1, 2020 was $6.1 million or 36.6% of revenue with the Retail Platform delivering $5.1 million, or 32.6%, gross profit, compared to $3.8 million with retail and wholesale operations delivering $3.5 million, or 34.7% of gross profit for the thirteen weeks ended November 2, 2019.

For the 2019 fiscal year, the Company recorded net comprehensive loss of $(32.6) million, or net loss per share, and on a fully diluted basis of $0.28. The net comprehensive loss incurred during the year was due to operating losses as the Company continues to invest in the expansion of its business lines, finance costs, and restructuring and impairment charges, partially offset by gains on its derivative liabilities.

Retail Platform Update

Throughout Fire & Flower’s fiscal 2020 year, the Company will be focused on continuing to build out its retail network. The Company intends to prioritize expansion in the Ontario market for the current fiscal year, and also intends to enter the British Columbia market once final licensing is complete, and other Canadian markets as regulations permit.

Fire & Flower has received its Retail Operator Licence and has submitted applications to the AGCO for an additional eight store locations.

In March of 2020, the Company announced the acquisition of the Ottawa and Kingston, Ontario stores that were initially operated under licence agreements by two Ontario cannabis retail store licence holders.

Fire & Flower has implemented a restructuring plan focused on optimizing the Company’s retail footprint by focusing on stores that are accretive to the business. This plan will close three locations in Alberta and will allow the Company to deploy resources and licence cap allocation to locations with higher profit potential.

The Hifyre Digital Retail and Analytics platform combined with extensive market research and trade area analysis provides a data-driven approach to optimization of the Retail Platform with the goal of maximizing both geographic reach and store profitability.

HifyreTMDigital Retail and Analytics Platform

Through its wholly-owned subsidiary, Hifyre Inc., the Company continues to commercialize and expand its digital retail and analytics platform that collects and analyzes consumer data to develop insights related to purchase preferences.

During the COVID-19 public health crisis, the Hifyre Digital Retail and Analytics platform has proven to be a competitive advantage, enabling Fire & Flower to rapidly deploy services such as curbside pickup, home delivery and click-and-collect services.

During the fiscal 2019 year, Hifyre launched the Spark PerksTMmembers program. Member benefits within the program include: Fastlane “click-and-collect”, exclusive deals and access to member-only events. Since the launch of Spark Perks in Fire & Flower retail stores, the program has enrolled more than 95,000 active members.

The Hifyre IQ product provides real time reporting and analysis to the Company’s marketing, retail experience and merchandising teams and is supplied to licensed producers to assist in demand forecasting, product development and sales reporting. Throughout the thirteen weeks ended February 2, 2020, Hifyre has continued to commercialize this platform through external account sales.

Fire & Flower’s financial statements and management discussion and analysis for the period are available on Fire & Flower’s SEDAR profile at www.sedar.comand on Fire & Flower’s website at www.fireandflower.com/investor-relations/.

Open Fields Distribution Platform

The Company continues to operate a cannabis wholesale business in the province of Saskatchewan, through its wholly-owned subsidiary 10926671 Canada Inc. (“Open Fields”). Open Fields purchases cannabis products directly from licensed producers and distributes those products to both Fire & Flower and other retailers across the province. Additionally, Open Fields sources accessory products from global suppliers and distributes those products to Fire & Flower stores across Canada.
During the 2019 fiscal year, Open Fields produced an additional revenue and margin opportunity through external account sales to other retailers in the province.

Fire & Flower’s ability to successfully execute the Distribution Platform demonstrates how this model can be adapted for use in other jurisdictions through direct relationships with licensed producers and accessory suppliers.

Adjusted EBITDA

The Company’s “Adjusted EBITDA” is a Non-IFRS metric used by management that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. Management defines the Adjusted EBITDA as the Income (loss) for the period, as reported, before accretion and interest, tax, and adjusted for removing the share-based compensation expense, depreciation and amortization, gains and losses related to derivative liability revaluations and debt extinguishments, professional fees associated with financing and acquisition and business development activities, impairment charges, restructuring costs, and includes lease liability payments that would have been excluded from profit and loss due to the application of IFRS 16 accounting standards. Management believes “Adjusted EBITDA” is a useful financial metric to assess its operating performance on a cash basis before the impact of non-cash items. As other companies may calculate this non-IFRS measures differently than the Company, this metric may not be comparable to similarly titled measures reported by other companies. For a reconciliation of Adjusted EBITDA please refer to “Non-IFRS Financial Measures” in the Company’s management discussion and analysis for the fifty-two weeks ended February 1, 2020.

Adjusted EBITDA for the fifty-two weeks ended February 1, 2020 was $16.3 million loss compared to $18.4 million for the fifty-two weeks ended February 2, 2019. Adjusted EBITDA for the thirteen weeks ended February 1, 2020 was $5.3 million loss compared to $7.1 million for the thirteen weeks ended February 2, 2019.

To see the following chart, click here:

https://fireandflower.com/investor-relations?tab=news-releases&release=fire-flower-announces-2019-fiscal-and-fourth-quarter-financial-and-operational-results&utm_source=Cyberimpact&utm_medium=email&utm_campaign=Fire--Flower-Announces-2019-Fiscal-and-Fourth-Quarter-Financial-and-Operational-Results

Conference Call

Fire & Flower will host a conference call today, April 30, 2020 at 8:30 AM ETto discuss these results. Trevor Fencott, Chief Executive Officer and Nadia Vattovaz, Chief Financial Officer will provide a management presentation by a question and answer session with research analysts.
Date: Thursday, April 30, 2020
Time: 8:30 AM Eastern Time
Conference Call: 1-888-390-0546
Conference ID: 8604477401
Replay Number: 1-888-390-0541
Replay Passcode: 477401#
Note: Replay is available until May 21, 2020.
About Fire & Flower
Fire & Flower is a leading purpose-built, independent adult-use cannabis retailer poised to capture significant Canadian market share. The Company guides consumers through the complex world of cannabis through education-focused, best-in-class retailing while the HifyreTMdigital platform connects consumers with cannabis products. The Company’s leadership team combines extensive experience in the cannabis industry with strong capabilities in retail operations.
Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc., a licensed cannabis retailer that owns or has interests in cannabis retail store licences in the provinces of Alberta, Saskatchewan, Manitoba and Ontario and the Yukon territory.
Through the strategic investment of Alimentation Couche-Tard (ATD.A, ATD.B), the Company has set its sights on the global expansion as new cannabis markets emerge.
For More Information Contact:
Investor Relations
[e-mail]
1-833-680-4948
Media Relations
[e-mail]
780-784-8859
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws (“forward-looking statements”). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “achieve”, “could”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “outlook”, “expect”, “project” and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions “may” or “will” occur. These statements are only predictions.
Forward-looking statements are based on the opinions and estimates of management of Fire & Flower at the date the statements are made based on information then available to the Fire & Flower. Various factors and assumptions are applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Forward-looking statements are subject to and involve a number of known and unknown, variables, risks and uncertainties, many of which are beyond the control of Fire & Flower, which may cause Fire & Flower’s actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Such factors, among other things, include: final regulatory and other approvals or consents; fluctuations in general macroeconomic conditions; fluctuations in securities markets; the impact of the COVID-19 pandemic; the ability of the Company to successfully achieve its business objectives and political and social uncertainties.
No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. Additional information regarding risks and uncertainties relating to the Company’s business are contained under the heading “Risk Factors” in the Company’s annual information form dated April 29, 2020 and the heading “Risks and Uncertainties” in the management discussion and analysis for the fifty-two weeks ended February 2, 2020 filed on its issuer profile on SEDAR at www.sedar.com.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
Fire & Flower assumes no obligation to publicly update or revise forward-looking statements to reflect new information, future events or otherwise, except as expressly required by applicable law.

[FUNMAN]

Fire & Flower Announces Retirement of $28,224,533 of Debt

June 26 2020

How on earth does this news NOT move the PPS up? - FUNMAN

Edmonton, Alberta (June 26, 2020) – Fire & Flower Holdings Corp. (“Fire & Flower” or the “Company”) (TSX: FAF OTCQX: FFLWF), today announced the repayment of $27,168,000 principal amount of 8.0% unsecured convertible debentures of the Company (the “Debentures”) (and accrued and unpaid interest thereon) issued on June 26, 2019 pursuant to the terms of a debenture indenture dated June 26, 2019 between the Company and Computershare Trust Company of Canada (the “Indenture”). This repayment by the Company represents the retirement of all Debentures under the Indenture.

About Fire & Flower

Fire & Flower is a leading purpose-built, independent adult-use cannabis retailer poised to capture significant Canadian market share. The Company guides consumers through the complex world of cannabis through education-focused, best-in-class retailing while the HifyreTM digital platform connects consumers with cannabis products. The Company’s leadership team combines extensive experience in the cannabis industry with strong capabilities in retail operations.

Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc., a licensed cannabis retailer that owns or has interests in cannabis retail store licences in the provinces of Alberta, Saskatchewan, Manitoba and Ontario and the Yukon territory.

Through the strategic investment of Alimentation Couche-Tard Inc., the Company has set its sights on the global expansion as new cannabis markets emerge.

For More Information Contact:

Investor Relations
[e-mail]
1-833-680-4948

Media Relations
[e-mail]
780-784-8859

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws (“forward-looking statements”). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “achieve”, “could”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “outlook”, “expect”, “project” and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions “may” or “will” occur. These statements are only predictions.

Forward-looking statements are based on the opinions and estimates of management of Fire & Flower at the date the statements are made based on information then available to the Fire & Flower. Various factors and assumptions are applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Forward-looking statements are subject to and involve a number of known and unknown, variables, risks and uncertainties, many of which are beyond the control of Fire & Flower, which may cause Fire & Flower’s actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Such factors, among other things, include: final regulatory and other approvals or consents; fluctuations in general macroeconomic conditions; fluctuations in securities markets; the impact of the COVID-19 pandemic; the ability of the Company to successfully achieve its business objectives and political and social uncertainties.

No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. Additional information regarding risks and uncertainties relating to the Company’s business are contained under the heading “Risk Factors” in the Company’s annual information form dated April 29, 2020 and the heading “Risks and Uncertainties” in the management discussion and analysis for the fifty-two weeks ended February 1, 2020 filed on its issuer profile on SEDAR at www.sedar.com.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Fire & Flower assumes no obligation to publicly update or revise forward-looking statements to reflect new information, future events or otherwise, except as expressly required by applicable law.

SOURCE Fire & Flower Holdings Corp.

[FUNMAN]

About Fire & Flower's partner. The article touches on cannabis near the end.  


Alimentation Couche-Tard And Circle K - Invest In One Of The Best Retailers In The World

There are lots of charts and graphs so if you want to see them, read the article at this link:

https://seekingalpha.com/article/4356128-alimentation-couche-tard-and-circle-k-invest-in-one-of-best-retailers-in-world

Jun. 29, 2020 8:40 AM ET

By: Brian Langis

Summary

ATD is an excellent retail operator. ATD has demonstrated a record of consistency and profitability few businesses can match.

M&A is the bread and butter of ATD. They are pros at buying, integrating, extracting synergies and operating.

ATD’s best opportunities have come after a difficult period.

Excellent balance sheet. Low leverage. Great cash flow.

ATD’s culture contributes to its success.

Note: Alimentation Couche-Tard use US$ as their reporting currency unless mentioned otherwise. USD-CAD 1.35, Price of 1 USD in CAD.

Alimentation Couche-Tard (TSX: ATD.A, ATD.B, OTCPK: ANCUF) is primarily traded on the Toronto Stock Exchange under the ticker ATD.B.


Alimentation Couche-Tard (ATD) is a CAD$47 billion Canadian convenience store and gas operator juggernaut that’s flying under the radar. ATD is the second biggest convenience store and gas station operator in the world after 7-Eleven with 14,880 locations and 133,000 employees in 26 countries. For those readers that want to polish their French,‘Alimentation’ stands for food and a ‘couche-tard’ is a night owl, a person that stays up late. The night-owl also reflects the company’s personality: patient, quiet, keeping an eye on things, and when the right opportunity presents itself it is ready to strike like a predator.

Despite its global position, most people are vaguely familiar with the company. It keeps a low profile. The name Alimentation Couche-Tard, or Alain Bouchard, the co-founder and current chairman, might not ring a bell. But you probably bought something at a Circle-K, which is owned and operated by ATD across the world. Few would know that ATD is in the multi-bagger club, returning 875x since its IPO in 1984. Few Canadians would know the fact that outside financials ATD is the company with the most revenues in Canada with ~$58b in annual sales (pre-Covid). Most Canadians would be surprised to learn that Couche-Tard/Circle K is the second largest convenience store chain in the world. Only 7-Eleven Inc.(OTCPK:SVNDY)is bigger in terms of store count (~68,000, mostly franchised), but ATD has better financial performance.

ATD will release its 4 th quarter results on June 29, so we will have a better gauge on the effects of Covid in the last quarter. ATD’s fiscal year ends in April.

If you get a chance to read a really good business biography, that covers co-founder Alain Bouchard and the Couche-Tard/Circle-K story, I highly recommend Daring to Succeed: Couche-Tard & Circle K Convenience Store. Read it and pass it on. You will learn more in that book about business than what you find in a standard MBA textbook.

Thesis: By investing in Alimentation Couche-Tard, you are buying a piece of an excellent business that has a history of creating shareholder value. ATD is currently undervalued by at least 13% with potential upside of 23% to 39% in 3-4 years if they complete their growth targets. ATD is currently in a plan to double the business. ATD is a buy and hold.

Below I will go in details on the company.

Over time, ATD shareholders have been well rewarded. On August 22, 1986, with only 34 stores, ATD raised $2.5m by selling 1.1m shares at $2.25 (post split: $0.046), which represented 25% of ATD at the time. Here’s a chart of the returns for the past twenty years, the maximum I could get.



Here’s a chart of the last five years compared to two indexes, which is more reflective of the current times. You can see that ATD has outperformed both the S&P 500 and the TSX 60.



It’s established that ATD has performed very well in the past. But that’s yesterday returns. Now the main question is will ATD keep delivering in the future? I believe it will.

About Couche-Tard
Starting with just one store in Quebec in 1980, out of French speaking Quebec, Couche-Tard has grown into 14,880 locations worldwide, mostly under the Couche-Tard, Circle-K, and Ingo banners. ATD has 7,661 stores in US, 2,138 in Canada, and 2,697 in Europe (Norway, Sweden, Denmark, Estonia, Latvia, Lithuania, Poland, Russia, Ireland). There are also 2,384 Circle K stores under licence in 16 other countries and territories (Cambodia, China, Costa Rica, Egypt, Guam, Honduras, Hong Kong, Indonesia, Jamaica, Macau, Mexico, Mongolia, New Zealand, Saudi Arabia, the United Arab Emirates and Vietnam).

Couche-Tard operates under mostly under these three banners below: Couche-Tard in Quebec, Ingo in parts of Europe, and Circle in the US and everywhere else in the world. Other brands owned by ATD, such as Holiday, Kangaroo Express, Topaz, Corner Store, and Statoil among others should have been converted to Circle K if they haven’t done so already.

Alimentation Couche-Tard is operating under three banners globally.

Circle K is ATD’s global banner. In 2016, ATD decided to retire most of their banners and adopt Circle K as their global identity, except in Quebec where the Couche-Tard brand is strong, and the Ingo automated stations (fuel only) in Sweden and Denmark.

ATD is also a wholesaler of transportation fuel and runs a large commercial fuels operation, including terminals and depots.

Before the shutdown due to the pandemic, ATD’s Q3 results cover a 40-week period that ended on February 2, 2020. Q4-2020, which will be released on June 29, will include a full quarter of Covid impacted results. For the nine months, business was good. Revenues came in at $40b, EBITDA at $3.3b, operating income at $2.1b, and net earnings at $1.5b.

Revenues are composed of mostly Merchandise and Services, and Fuel sales. Fuel is 73% of sales and Merchandise and Services is 25%. The other 2% of sales composed of everything else like car washes, ATM fees, aviation fuel, rent income and other things. Merchandise and Services contributes to 54% of gross profit vs 43% for fuel. The main take away is that fuel brings in revenues and the profit is in the store. It makes sense that ATD is focused on getting people into the store to buy high margins. The table below illustrates that:

Source: ATD March 2020 Presentation. Figures based on fiscal year 2019.

The table also illustrates that the US is responsible for 69% of sales and gross profit with Europe in 2 nd and Canada 3 rd. Despite being a global company, the US still mostly drives the results for Couche-Tard and probably will for the foreseeable future. There’s still a lot of room for growth in the US.

The following slide does a good job catching the key business metrics:



Source: Alimentation Couche-Tard March 2020 Presentation Slide 8

The slide is self-explanatory. The numbers that stick out are Return on Equity (ROE) of 22% and Adjusted Return on Capital Employed (ROCE) of 13.7%. As a principle, ATD aim for a ROCE of 15% and average 15.4% per year since 2011. ROE 5-year average is at 23.5%. What do these numbers mean?

Ratios like ROE and ROCE have to be analyzed to get to know the real picture. Simply put, ROE considers profits generated on shareholders' equity. It simply means that the company increases shareholder value by reinvesting its earnings in order to make more profits. The higher the number, the more efficient management is. ROCE measure of how efficiently a company utilizes all available capital to generate additional profits. In other words, how well ATD is generating profits from its capital.

An interesting number is EBITDA, despite its flaws and critics, gives you a picture of the operations. EBITDA for fiscal 2020 is expected to be around $4-$4.2 billion. It will probably dip for FY2021 once Covid is taken into account. ATD redeploys 35%-40% of EBITDA towards CAPEX. On average just over one third of EBITDA is converted to FCF. I estimate that ATD will generate close to $1.6b in FCF for FY2020, or $1.4b after dividends. Buybacks, at $236m for the first three months, have been suspended due to Covid. The FCF is available to pay down debt or for acquisitions. If ATD continue to operate the same way they have done in the past, EBITDA and FCF should continue to grow.

The Economics of a Convenience Store
ATD is an excellent retailer. One of the all-time great if you look at what they have accomplished. They are not an Amazon where you wait for your items. Plus you can’t fill your car on Amazon. They are not a Costco where you need to plan your trip. Couche-Tard is different. Couche-Tard is in the business of selling time. ATD’s mission is “making our customers’ lives a little easier every day.” They offer convenience. They respond to impulse. When you are on the road three things come to mind: gas, washroom, food. This is where Couche-Tard comes in. Key factors are price, cleanliness, safety and, most important, location. The right store at the right location is a gauge of success. A good store in the wrong location won’t be as profitable. Just think about your behavior when you get off the highway to get gas and food, if the store is at the wrong exit or corner, it will get less volume. Hence, picking the right site is paramount.

The basic principles of convenience store retailing, as a biography of Bouchard explains, are "a clear, well-laid-out interior, proper lighting, nice colour and general cleanliness, no lineups, well-trained and welcoming employees, and the elimination of useless jobs in the administrative offices," since all the money was made in-store. The focus has always been to convert fuel dollars and foot traffic into food sales.

A convenience store is a cash flow business. Once the store is established, it generates a certain level of cash flow. How do you grow? You buy or build a new store, apply the blueprint, and repeat.

There’s a monopoly feel to a good convenience store. It’s normally located at the right location, and you can’t really have more than one or two in the same area. Once the territory is established, the convenience store is there to serve our addictions. We might not realize it, or we might not see it that way, but most customers in a convenience store are there to fill the impulsive “I need something right now” need. We are addicted to fuel, nicotine, alcohol, gambling, sugar, caffeine, junk food, and *cannabis (ATD has a cannabis retail venture, more on that below). Couche-Tard is there for addicts to get their legal fix. It’s all about quick sale, at a premium. Whatever you need, ATD can adapt to customer behavior.

ATD is using fuel stations to boost convenience store sales. Like I mentioned above, it’s all about getting the customer in the store. There’s a reason why pump stations are facing the stores now versus the old days when the pump stations were parallel to store so vehicles could leave faster. ATD is retail first, fuel second. Now when you pump gas, you are starring at that nice shiny store that’s tickling a bunch of impulses in your body; beer, sugar, nicotine, coffee, lottery ticket, washroom, sugar…anything to respond to your nervous system. The store offers the types of high margins that pumping gas doesn’t. ATD’s merchandise and service gross margin are 33% in North America and 41% in Europe. Combine that with an increase in same- store merchandise sales and you have a nice cash flow machine. If I can borrow a phrase from the software industry, if done properly, a convenience store can have recurrent revenue feel to it.

Technology plays a massive role. Couche-Tard is more of a data company disguised as a convenience store. Data mining, AI, and technology drive same-store sales. With the data they build reliable customer profile. Their system knows instantly what is selling where. Shelf space is allocated at each store accordingly. For example, they learned that they sell more flowers if you place them in the dairy section instead of the beer section. It turns out customers create a stronger association. You know these high margin items in front of you at the cash registers? They have put a lot of thoughts into that.

What is ATD focusing on now? At the core they want to drive organic growth. ATD wants a more balanced growth going forward between acquisitions and organic. At the moment organic growth is at 30% and they want that number at 50%. You achieve that with greater focus on the offering.

They are pushing their private-label items like Polar Pop fountain programs and the Simply Great coffee, which offers high margins. The private-label also provides more clout with suppliers like Coca-Cola and Nestlé.

On the coffee side, ATD is rolling out $15,000 coffee machines in their stores. Now you can have a glamour coffee for a fraction of the cost at Starbucks. I know I’ve tried their expresso and it’s good. It just doesn’t have the Starbucks “status symbol” if that means anything.

ATD is also currently testing Holiday’s, one of their acquiree, unique store layout. Holiday has a unique store layout where customers are routed thoughtfully through the food section back to the coolers and into the impulse area where they wait to pay.

ATD is also focusing on their food offering. Improving Couche-Tard's food products, especially in North America, is a pivotal part of the plan. While fresh food is its number 1 profit category in Europe, that's not the case here. In Europe, stores are viewed as more of a foodservice destination than in North America. In Europe, stores have about 35% ready-to-eat, house-made sandwiches, coffee and other baked goods, but no perishables. In North America, it’s 20%. ATD wants to change that. ATD has embarked on a major growth initiative dubbed "Food at Scale", another idea borrowed from Holiday. The company has been building out and installing the necessary structures and equipment inside stores for its Food at Scale program, which is focused on strengthening foodservice offerings. Couche-Tard targets 1,500 locations for its Food at Scale program. The stores that have not kept up with the modern evolution on foodservice are going to be left in the dust.

Brian Hannasch, CEO
Brian Hannasch is Couche-Tard’s CEO since 2014, when he took over co-founder Alain Bouchard, and he hasn’t disappointed.

Brian was the VP of Operations with Bigfoot Food Stores LLC, a 225-unit convenience store chain in the US Midwest when it was acquired by Couche-Tard in 2001. When Bigfoot was acquired, he figured he would stick around for the transition, and then find something else. It’s usually how these things go. Not only had he never heard of Alimentation Couche-Tard, but he couldn't even pronounce the company's name or understand a word of what the French-Canadians (the four co-founders) were saying. But after getting to know the co-founders and the company culture, he stayed and has remained with the company ever since. Brian has proven himself many times over the years, mostly focusing on the operations.

Under his leadership, ATD has grown to be the largest company in Canada in terms of revenue (outside financials) and the 2nd largest convenience store groups in the world. He has piloted the acquisitions of The Pantry, Statoil, CST Brands and Holiday Station stores. EBITDA as grown an average of 17% per year during his tenure. If he can maintain that growth, and it won’t be easy, you can expect ATD’s stock to perform well. He also led the global rebranding campaign to bring the company’s diverse brands together under the Circle K banner.

Where in the past Alain and the co-founders shun the press, Brian is better at communicating with the press and financial community. He does interviews and conference calls.

The appointment of an American at a Quebec based company has ruffle feathers, enough for shareholders to bring it up on at past AGMs. But Alain Bouchard dismisses the criticism, saying the CEO's role is to deliver returns for investors, not to learn languages. The reasons the founders picked Hannasch as Bouchard's successor are tough to debate. Brian is currently in his mid-fifties and should be around for a while.

Culture
Culture is what makes a business unique. It’s really their identity. It is like a finger print, it may be similar to others, but is uniquely distinct to your business. There’s nothing glamour about a convenience store chain. What has made ATD a success for forty years is its culture. It’s also what will carry the company forward.

For example, Couche-Tard has no ‘headquarters’ in the traditional sense. The word ‘headquarter’ is banned because it releases hierarchical superiority, a form of centralized decision making that gets shoved down the line. They are trying to remove ego in the decision process. Administrative offices are service centers. It’s more than just a PR move to make people feel better. The wording reflects the organizational philosophy of the company. The employees at the service centers are there to serve the stores, and not the inverse. Alain Bouchard’s office is on the ground floor, not corner office in a glass tower. You will find dry wall and wall dividers, not mahogany wood. They do have a Bang & Olufsen sound system, but it’s from the last century. Bouchard often says that the money is made in stores, not offices. The customers are in the stores, not in the office.

Here’s what Alain Bouchard had to say about the service center in Laval:Source: Financial Post. Highlights mine.


Source: ATD, highlights mine.

ATD has a decentralized business model and it’s more than just a buzz word. It’s actually how the company is run and sets them apart from the competition. ATD manage most of their operations and workforce in a decentralized way to speed up decision-making and address local demand for specific product and services. If Circle-K customers in Laredo Texas want tacos, then tacos it is. This process eliminates overhead costs. Each store operates as a distinct business unit and store managers are responsible for meeting their financial and operation targets. They are empowered where the workers have a lot to say and take a lot of decisions. ATD wants their manager to act and feel like he owns the store. How? It goes back to the empowerment principle by giving managers a lot of power. Rigorous performance measurement and benchmarking process ensures that best practices are used across the network.

Why care about a company culture? From an investor point of view, it’s not just“nice-to-have.” Companies with strong cultures tend to be higher performers. When a culture is strong, it leads to motivated employees and high performing managers. Also it helps with the process of integrating an acquisition. At first an acquiree is suspicious. But from what I’ve read during my research, there’s a pattern that repeats itself. After getting to know the Couche-Tard team and culture, the acquiree has nice things to say about Couche-Tard. They actually like being part of something bigger and successful. We have seen this with Circle K and Statoil in Norway. One of the best things you can do is help others succeed.

What’s Next?

In fiscal 2019, ATD adopted a 5-year plan. The plan’s objective is straightforward: To double again by 2023. To double revenues and profits through both organic growth and network expansion. ATD has doubled numerous times in the past. However ATD is putting more emphasis on organic growth this time, more than 50%.

ATD has the financial muscle to grow. As at February 2, 2020, it had US$4.3b of liquidity comprised of US$1.8b in cash and US$2.5b in credit facility (maturing in December 2024). Its cash balance has improved since then. ATD aim to keep adjusted net debt to EBITDAR below 2.25x. The current leverage ratio is below the 2.25x target.

ATD has two covenants in their credit facility:

Leverage ratio: A Leverage Ratio not greater than 4.00:1.00, provided that following a Permitted Acquisition in respect of which the purchase price exceeds US$200,000,000, the maximum Leverage Ratio of 4.00:1.00 shall be adjusted to a maximum Leverage Ratio of 4.50:1.00 for a period of twelve (12) months following such Permitted Acquisition. Interest Coverage: An Interest Coverage Ratio of not less than 3.00 to 1.00

ATD had over $7b of balance sheet capacity for growth.

M&A

Merger & acquisitions is Couche-Tard’s bread and butter. M&A is not easy and most of the time they are value destructive. A lot can go wrong. Companies have a mandate to grow. So they look outside and buy their competitors, often at inflated price. Acquiring is the easy step. Integrating, operating, and extracting synergies are the hard part. To create value, acquisitions have to be completed at the right price with the right conditions. ATD doesn’t favor store count growth to the detriment of profitability. ATD has a long track record of successful integration and synergy capture. ATD has the right playbook. How does ATD succeed at it?

The link here provides a timeline of the most important deals ATD made. Below is a slide with some of the deals since 2003 Circle K acquisition. It’s definitely not their first rodeo.


Source: Alimentation Couche-Tard March 2020 Presentation. Slide 23.

ATD has a disciplined operating track record and has demonstrated the ability to integrate and generate positive free cash flow with which to de-lever after closing large debt-funded acquisitions. Couche-Tard achieves synergies by eliminating of lot of their corporate overhead because as they grow, their overhead per store keeps going down. But it doesn’t stop with just cutting cost. Because ATD is an excellent operator, they increase revenues and margins. If you increase revenues, margins, and reduce overhead, you increase EBITDA. The ability to save more gives ATD the ability to pay more. For example ATD has boosted The Pantry's EBITDA by more than 30% versus pre-acquisition levels.

The convenience store sector is highly fragmented and in a consolidating phase. ATD gains market share when they acquire, when competitors close sites, and by improving their offering. ATD currently has 5% of the market share in the U.S. There are plenty of targets. There are 152,720 corner stores in the U.S., most are single unit (62%). You also have regional chains, like Casey's General Stores (CASY) and Murphy’s USA (MUSA). Privately owned operators like Pilot, QuikTrip, Sheetz or Wawa could be potential targets. Integrated oil companies are in the process of selling, or are expected to sell, their retail assets. It represents quick money for them, money they desperately need in current times. Expect ATD to be part of the process.

You probably read in the news that Marathon Petroleum (MPC) is exploring their options regarding their Speedway gas station unit. According to the WSJ, MPC is in talk with potential buyers. ATD is rumored to be one of those potential buyers. This is not breaking news. MPC has been talking of spinning off Speedway since October 2019. Seven & I Holdings (OTCPK:SVNDY), 7-Eleven’s corporate parent, dropped their $22 billion bid for Speedway, after balking at the price according to the Nikkei newspaper and Bloomberg News.

It’s worth noting that activist investor Elliot Management is on MPC’s case to “unlock” value. I actually invite you to check out their extensive presentation on MPC, it mentions ATD quite a few times with key data point, and the case for selling/spinning Speedway.

ATD will not overbid for Speedway. Normally, if the business deserves it ATD pays 10x EBITDA pre-synergies, which come down to 7-8x EBITDA post synergies. ATD has walked away in the past, like they did with Casey's General Stores (CASY) back in 2010.

On the menu is also Caltex Australia (OTCPK:OTCPK:CTXAY). The acquisition would have helped contribute to their “Double Again” plan. Caltex has about 2,000 stores in its network across Australia, $5.6b in sales and $600m in EBITDA. Couche-Tard’s bid is worth almost $8 billion, its largest ever. The acquisition was suspended due to the pandemic. However, ATD has not dropped the idea completely and it’s possible that renegotiation restarts once the picture is clearer. The acquisition of Caltex was supposed to be the springboard for ATD’s Asia-Pacific expansion. If the talk even resumes, it shouldn’t take long since financing was secured and due diligence completed.

3 Main Concerns
Couche-Tard faces two long-term challenges, the decline of tobacco sales and oil, and a short term one, Covid-19. Let’s start with the current one.

Covid-19

ATD was deemed an essential business. Despite the status, the pandemic has hit convenience stores—especially their fuel business—hard. Fuel sales have dropped, stabilized, and are now improving. In a sense, hurricanes and floods have prepared Couche-Tard for the challenges of Covid. The convenience store industry plays a key role on providing fuel, emergency items and staples.

The China Circle K stores, while I would take the insights lightly, observed that the shopping experience there “has started to feel more normal” of late and some consumer behaviors have gone back to what they were. Their words, not mine.

The pandemic was not all negatives. Of course the business suffered from lower sales and higher operating cost. Some good came out of it.

For example, the company said it has been able to expand many delivery platforms and pull forward enabling technologies that could become key to serving customers beyond the current pandemic. These initiatives include:

The expansion of home delivery capabilities in North America to more than 620 stores. In partnership with Favor, a Texas-based on-demand delivery company. The delivery can be done in under an hour (US$3 delivery fee with no minimum order). Click and collect and curbside delivery in both Europe and North America, with pre-ordering and payment through the Circle K app Frictionless payment technology in Norway to accept fuel payments using license plate recognition

Also the current crisis can offer opportunities for ATD to take advantage of. Brian Hannasch told analysts that the retailer also has the financial flexibility to withstand any pressures and also take advantage of acquisition opportunities that may arise from struggling competitors. Brian said "If I look back over the years, I would say some of our best opportunities have come after a difficult period". Companies that are under financial distress are often forced to sell valuable assets. Mom and pop convenience store faces higher cost and issues related to the pandemic. I’m sure many of them want to stay in business. The main question is how many of them want too?

Tobacco

Tobacco products represents 41% of merchandise sales. That’s significant percentage is considering the war on nicotine by health authorities around the world. While tobacco sales are a good thing for Couche-Tard at the moment, how will it be impacted in the long run considering that tobacco consumption is expected to decline over time? There’s also the health issues associated with the use of e-cigarette or vaping products.


Source: ATD 2018 Annual Information Form

Last year Tobacco performed extremely well in FY2019 with SSSG of 7% across ATD’s global network. These good numbers were supported by extremely strong growth from e-cigarettes and tobacco was a key driver behind ATD’s strong consolidated merchandise SSSG of 4.3% in FY19. The Trump administration has introduced a limited flavor ban applied only to vaping cartridges – not to tanks, disposables, and other means of flavoring the content of vapes. I find it hard to find accurate data on what’s going on in the field. It seems that each state is going about this their own way. New-York announced they are banning flavors, making it the 4 th state to introduce such measures. What’s the impact? We don’t have FY2020’s numbers since their fiscal year ended in April. We will get more accurate numbers on June 29, 2020 when they release they annual numbers. We can assume that a good chunk of e-cigarettes users will switch to other tobacco products to feed their addiction.

How is ATD addressing tobacco’s long-term decline? ATD offset tobacco yearly usage declines of about 3%-4% a year (long-term average) with a 5% price increase. Tobacco use has been declining for decades. Despite being a significant portion of sales, it’s not the cash cow it used to be.

ATD is evolving from a just a basic essential need store. They are testing new ideas to attract new customers. They are focusing on to-go meals and fresh food. They have sleek coffee programs. They are putting a lot of emphasis on beverage, a high growth category. I don’t know if you have been in a new convenience store lately, but the beverage category is massive. Every wall is a fridge.

Basically anything is possible. ATD collects enough data to figure out what customers want. It’s all about enhancing the shopper’s experience.

I expect tobacco, although in decline, to remain around for a long time. The numbers of smokers might be smaller over time and will remain an important part of Couche-Tard’s sale. Addicts are reliable customers. Drug dealers know that.

The Norway Lab
Fuel demand will decline over time as fuel efficiency improves and electric vehicle penetration increases.

Couche-Tard has a front row seat in Norway on the convenience store/gas station of tomorrow with its EV laboratory. With 43% of new car sales in Norway being EVs, Norway provides a good testing ground on the change to come. Norway has an ambitious target of having all new vehicles be zero emissions by 2025. ATD understands this trend is not reversing. ATD is now testing different approaches to the changing fuels market, namely EV.


Source: Alimentation Couche-Tard 2020 Presentation, slide 24.

ATD is also in the unique position of being the fuel leader in Norway. Most countries have pretty aggressive targets on achieving zero carbon emission. Achieving that goal means leaning off oil and having more EVs on the road. I don’t think we can dispute the decline of oil over the long-run. I think the main question is how fast we adopt “alternative” technologies. Although early in the experiment, there are some insights to share.


Source: electrek.com - Fuel-retail chains are visiting Norway to ponder a future when gas stations don’t exist.

It took EV penetration reaching ~10% before there was a notable decline in fuel consumption. The decline appears to be accelerating, from 1–2% in 2017–18 to 4% in the year to date in 2019. Has fossil fuel consumption reached an inflection point in Norway? I believe it’s important to monitor this trend closely and see what impact it could have on ATD’s financials as well as sentiment on the stock over time.
It will take time in North America for EVs to reach a 10% market penetration. Given the immense size of North America, as well as for political reasons, generous financial incentives are costly and might not be fiscally sustainable.
In addition, according to the Norwegian Electric Vehicle Association, 70% of its members also own a fossil fuel car. One reason could be ‘range anxiety’, with the ICE vehicles able to go longer distances.
A lot of ATD’s fuel volume is sold in the B2B market (e.g. trucks), which is less affected by the EV shift. Also, EVs tend to have a bigger impact on fuel sites in the cities; a relatively small percentage of ATD’s sites are in the cities (low-single-digit), with the majority being in rural and suburban markets.
While EV charging is a logical extension for ATD and fuel retailers, return on investments is going to be impacted by numerous factors. Utilization rate must be relatively high for EV charging to be profitable. Some locations might have constrained electric grids that cannot provide the required high voltage. The charging stations are not that profitable at the moment. The fuel retailers will need to set a charging fee that is reasonable to users and earn an acceptable return. Currently, most fee arrangements are focused on acquiring users, rather than on earning a sustainable return.
Despite the gradual pressure on fuel demand, fuel margin dollars will have a more important impact on ATD’s earnings in the next few years.
ATD has invested in the largest network of EV charging stations. They are a partner in IONITY a JV with the BMW Group, Daimler AG, Ford Motor Company and Volkswagen Group with Porsche and Audi. The JV was founded in 2017 with the goal of building an extensive 350kW high-power charging network or EVs along major highways in Europe.
Despite the slowdown in fuel volume, ATD has so far managed to produce solid results in terms of merchandise SSSG and margin, and fuel margin. This is largely due to the company’s successful execution of merchandising and marketing initiatives.
Silver lining: Smaller less profitable fuel stations will close first which will led to consumers migrating to the better more efficient operators like ATD.
Silver lining: Car manufacturers are making engines more fuel efficient (often with a turbo). But turbo engine require higher quality fuel, like supreme, that come with better margins.
For further readings, a 2019 Boston Consulting Group report titled “ Is There a Future for Service Stations?” provides interesting food for thought on what the future of gas stations might look like. According to the report, amid the rise of EVs, car sharing and autonomous vehicles likely to be refueled in special parking areas, as many as four out of five gas stations may be unprofitable within 15 years.

ATD is aware and understands this long-term declining trend. Instead of fighting the wave, the solution is to go with it. ATD understands that you need to adapt to stay in the game. Retail is critical to their long-term success. Convenience store revenues will be essential to offset declining sales at the pumps. Whether its tobacco, sugar, coffee, or fuel, the idea is always to get customers in the store. While it is still very early days, examples include the installation of Amazon lockers for pickup, which could potentially increase foot traffic. As reported by CSP, Amazon has expanded Counter, “a network of staffed pickup points that gives customers the option to pick up their Amazon packages in-store at a partner location”.

If Couche-Tard didn’t adapt to change, they would look like this:


Source ATD. A Couche-Tard store in the mid-1980s and today.

Cannabis/CBC Opportunity

Couche-Tard is laying the foundation to participate in the marijuana space. At the moment the results are immaterial. It’s hard to quantify the opportunity. Is there a future there? Probably if you play your cards right but it’s too early to tell. There are many challenges. There’s still a lot of regulatory work to get through, so much unknown, especially in the U.S., and the competition will be ferocious (already is) if and when the light turns green. It seems that everybody, from grocery stores to pharmacies, wants a piece of the pie. Legalized since fall 2018, Canada can provide some insights. Although, not related to ATD, feel free to read my article on marijuana to learn more. Retail distribution is mostly restricted to licensed dispensaries (government-run or private).



The way ATD plays the cannabis space is through the retail side. ATD announced a strategic investment in Fire & Flower (TSX: FAF, FFLWF), a cannabis retailer in parts of Canada (Alberta, Saskatchewan, and Ontario). Eventually, once all the warrants are exercised, it would increase Couche-Tard’s ownership interest to 50.1%. If fully exercised, the warrants would provide between $380-$830 million of growth capital. FAF currently operates 45 stores and is expanding. Feel free to check FAF’s shareholder presentation here. The idea here is to bring retail best practice and know-how to the marijuana space. This is very early stage and the question of “will it work” remains uncertain.



Couche-Tard also announced a multi-year agreement with Canopy Growth (TSX: WEED, CGC). ATD is currently operating a “Tweed” branded store in London, Ontario. On the face of it, the agreement to open a single store doesn’t exactly scream “big deal.” But the tie-up could prove to be the most significant deal for Canopy if it can leverage Couche-Tard’s massive global footprint. Former CEO was tight-lipped about the tie-up, declining to comment on whether the London store will be a launchpad for a bigger partnership.

While these partnerships are small financially, it positions ATD to participate in the cannabis space. More importantly, ATD will be able to leverage its experience in Canada and participate in the much bigger recreational cannabis market in the US once cannabis is legalized at the federal level. Well that’s the idea. At the moment I can’t quantify the impact of ATD stepping into the cannabis space. It’s a long-term initiative. It will need to be reviewed in the future.

Dual Share Class Collapse

Couche-Tard has a dual share class structure that carries a sunset clause set to expire in December 2021. Hatched in 1995 when Mr. Bouchard and the other founders were in their 30s and 40s, it stipulates that their voting rights – by which they control the company through a Class A shares with 10 votes each despite collectively owning just 22.7% of the equity – would end when the youngest of them turns 65 – and that occurs in December 2021 when Jacques D’Amours turns 65. Class B shares have one vote per share. Together the four co-founders have 66% of the voting rights. It’s worth noting that the co-founders were denied extending their control of the chain in the past. ATD needs to have the two-thirds support necessary from Class B shareholders to pass an amendments to the article of association to nix the automatic termination of the company's dual-class share structure so the founders could continue to exert voting control with their Class A shares.

The basis for the dual share class was to provide takeover bid protection. In the early-mid 90s, when ATD’s stock would have been more ripe for the picking, it could have easily been swallowed by a competitor, or some type of speculative investing fund. Without the protection, who knows if ATD would have become the success it is today.

Now I’m not endorsing dual share structure. But I’m also not totally against them. I see the purpose of having them. Multiple voting shares gives you power. It comes down to how you use that power. In this case, the co-founders have not abused their power. They actually used it for the benefits of all the shareholders. If they had acted against the interest of the shareholders, the market wouldn’t have rewarded ATD the way it did. ATD is one good example. But more often than not, not everybody acts like Couche-Tard and dual share classes have been associated with governance issues.

Now what does this mean?

Once ATD has one share class and the founders’ power is curbed, there would be fewer obstacles in the scenario if somebody tries to take over it. However, Couche-Tard’s $47b market cap would make it a pretty big fish to swallow. ATD is more likely to acquire than be acquired. Also the province of Quebec is highly sensitive about takeovers of its homegrown companies.

Not being able to extend founders’ control beyond 2021 has been a source of frustration for the founders. Alain Bouchard expressed shock that investors rejected the idea given the stellar returns on investment generated and talked of selling the company if it gets to it.

Valuation

Let’s work with the idea that ATD’s earnings normalized for FY2022 (we are in FY2021) and no acquisition is completed. We can expect ATD to earn $1.91 per share in FY2022.

At a current share price of $42, ATD is undervalued. We can expect ATD to trade between $47.7 and $49 per share, for a return between 13.6% and 16.6%. The multiple of 18.5x PE is based on its historical 5-year average.

However you are not investing in ATD for the status quo. ATD has a plan to grow and to double again over the next 3-4 years supported by M&A and organic growth. They have the financial and plan in place to achieve that. So what would it look like if they actually achieve what they said?



I added a 20% margin of safety to the target valuation. This provides a buffer for judgement error. Under the double again model, ATD could trade at $51.95, an upside of 23.7% including the margin of safety. Without the margin of safety, you get a return of 54.6%. However it’s better to be conservative. Some argue that my 20% margin might be too much when you take into consideration such a high quality company.

What if ATD achieves their doubling their EBITDA target from $3b to $6b? ATD currently generates $4b of EBITDA and should be expected to dip for FY2021 due to the pandemic. But let’s play with numbers. Let’s work with the idea that ATD acquires Speedway, which generates $1.5b in EBITDA. That would get them closer to their goal of $6b. $4b in normalized EBITDA + $1.5b gets you to $5.5b. Add Caltex Australia generates about $600m and you got all the pieces. You have a leading market share in the US and a platform to grow in Asia-Pacific. In that scenario I didn’t take any organic growth into account.



Of course acquiring both businesses anytime soon stretch reality. Life is not that easy. Not only do you need to pay the right price, these targets will probably have competing offers. Will 7-Eleven let ATD get Couche-Tard? Will EG Group let ATD get Caltex? You also need to secure the financing, integrate the businesses, find synergies to be realized over a few years, and operate them. These are two massive bites to swallow. The M&A community believe that a traditional spin-off of Speedway could yield between $15-billion and $17-billion in value for Marathon Petroleum shareholders. The Caltex bid was around $8 billion. So $25 billion for ~$2-2.2b in EBITDA, slightly over 10x. We know that ATD had the financing secured for the Caltex bid before suspending the process. Going after Speedway will require more financing, likely a combination of debt and equity. Respecting the covenants, ATD could get ~$13b (3.5x pro forma net Debt/EBITDA), and another $3b-$4b in new shares. Maybe a stretch, but they could pull it off.

Below I’ve derived the EBITDA multiple from previous take overs. You can see that ATD pays around 10x EBITDA. Energy Transfer paid top dollar for Susser Holdings (Stripes convenience stores), which inflates the average take out multiple. Speedway was looking for 15x EBITDA before 7-Eleven backed out.



The numbers above are not far stretched when you look at comparable. Casey’s trades at 11x EV/EBITDA. Murphy’s is at 10x EV/EBITDA. ATD is a superior retailer than both of them. Couche-Tard currently trades at 10x EBITDA (EV C$57b/C$5.67 EBITDA). If you apply past transactions take out multiple or comparable, you get some upside.

In my analysis I used FY2022 because FY2021 is depressed by Covid-19. The downside is an extra year or two to achieve their goals and a slower than expected recovery. Valuations are going to be interesting as they’re driven by cash flow. Markets are forward looking machines. In general the market kind of skips over 2020 like nothing happened (except for travel related companies and others). Current valuations tells us that the market believes that everything is going to be fine in twelve months. I’m not sure if I share that point of view. Things might be better but volatility is on the menu. The first quarter of 2020 was strong for most convenience stores but the second quarter will take a big hit. Those financial results are an important part of the valuation process. It drives multiples and flow of capital. The bigger question is: How long will the downward trend in numbers continue?

Summary

One might argue that ATD is not cheap by looking at its current P/E multiple. Simply looking at P/E multiples to determine if a stock is cheap or not is very narrow. It’s less about a high or low multiple, but more about what are you paying for? ATD currently trades below its 18.5x 5-year average. But with a ROE consistently above 20% and average ROCE at 15.4% since 2011, these are excellent indicators that you are buying a high quality company. ATD deserves a high P/E multiple. If we have learned anything during the pandemic, it’s that paying more for quality is worth it. The companies that took a beating during the pandemic are lower quality ones. The high quality companies are barely dented. Plus, high quality companies can take advantage of opportunities provided by the current crisis. In fact, Couche-Tard has managed to keep growing through the past three recessions.

Convenience stores are not glamorous investments. Alimentation Couche-Tard is not a sexy company. But they make money and it’s one of the great retail success story of the last forty years. Why? Convenience stores are a simple business. They are predictable. ATD generates tons of FCF and has consistently earned high return on capital. They have excellent management and culture. Couche-Tard's executives do what they say. Go back to any time, even 80s and 90s, they told you what they were going to do and they did it. They said that they were going to buy this chain and that competitor. They got it done. They said that they were going to America. They got that done. Then they said they were going to double the business over and over again. They got that done too. ATD is in the business of selling time and they are the best at it.