Replies to post #237 on TILT Holdings Inc (TLLTF)

[FUNMAN]

TILT Holdings: The Baby Has Been Thrown Out With The Bathwater

Feb. 3, 2020 11:45 AM ET

By: Winds Research

https://seekingalpha.com/article/4320973-tilt-holdings-baby-thrown-out-bathwater?utm_medium=email&utm_source=seeking_alpha

Summary

* TILT is down 94% from its 52-week high.

* A strong and growing revenue base set against its low market capitalization opens up the company as a value play.

* While its liquidity position is weak, the continued generation of cash from its operations will allow it to survive the sector cash crunch.

* The expression "Don't throw the baby out of with the bathwater" describes an avoidable error in which something good is eliminated in the process of getting rid of something bad. TILT holdings (OTCQB:TLLTF) is that baby.

The company, down 94% from its 52-week high, trades at a market capitalization of $138 million with a value of $0.25 per common share. The central thesis of my bullishness is that TILT is an under the radar cannabis stock which saw its stock price get crushed after it went public at an unfortunate time. This company found itself amidst a tapering of investor sentiment towards the sector and could do little to differentiate itself from an investment standpoint.

Further, it was losing money, and the complexity of its holding structure meant it has been difficult to value. Against this torrid backdrop, the divergence between the company's market value and its intrinsic value has reached a level where one would be excused for concluding that it is tiptoeing at the precipe of bankruptcy. TILT, currently trading at a forward price-to-sales of 0.57, represents deep value, possibly the deepest in the industry.

TILT's Financial Strength And Valuation

TILT realized revenue of $46.10 million during the third quarter of its 2019 financial year, net income, while positive at $26.10 million, was converted very poorly to operational cash flow due to a negative adjustment for stock-based compensation. This meant that for every $1 in net income generated by TILT, only $0.11 was converted to operational cash flow.

While this is clearly sub-optimal, the company, operating in a fledgeling market, faced the aggregated headwinds of a vaping health crisis, sector-wide cash crunch, and management turnover. These would have negatively impacted the operational scalability of the firm, created inefficiencies, softened revenue, and increasing the cost of capital.

Hence, the bull case assumes that the cash generated from operations, while small, will not be a one-time result. If TILT is able to build on this positive base in its future quarters, then the threat posed by the currently weak liquidity position of the company will be somewhat mitigated. Total cash and short term investments at the end of the quarter was $3.6 million, with a further $35 million raised through the sale of 8.0% per annum senior secured notes post period end. The proceeds will help TILT retire short term bridging finance which bore interest at 18.75% per annum. This will mean a cut to interest expense of $5.8 million realized during the quarter, raising the prospect of a further strengthening of future operational cash generation.

Assuming TILT grows revenue 11% to $51.2 million in Q4 2019, total revenue for the year would be $170 million. Taking a two-year view, and assuming a compound annual growth rate of 20% across this period, revenue for FY 2022 would be around $244 million with a forecasted net operational cash flow margin of $20.80 million. This would place forward (2-year) price-to-cash flow of 6.63, an incredibly constrained figure.

However, the spectre of future toxic dilutive rounds and below market value assets sales to raise capital provides an ample rebuff for any potential TILT bulls. The company might prove to be a value trap, indeed its current cheapness is for a reason; a precarious cash position set against a dried up capital market. This presents bankruptcy risk, the worst risk of all. Further, if actual results are not in line with my bullish assumptions, then the long case for TILT crumbles.

And while the company, in an openly published letter to its shareholders, described a continued generation of cash flow from their plant-touching assets, it is not clear whether total aggregate cash flow will be positive during the fourth quarter. But bulls would be pleased to have heard the comments from Mark Scatterday, TILT's interim CEO, on his belief in "disciplined financial management and fiscal accountability". TILT now more than ever needs to be tethered at the hip to prudent financial management.

The Baby, The Bathwater, And The Throwers

Fundamentally, TILT is a company with an impressive and growing revenue base, generating positive operating cash flow. At its current market capitalization, its earnings potential is being severely discounted by the market. The baby has been thrown out with the bathwater, and the throwers seem to be remiss to this.

If TILT maintains and improves on the fiscal discipline displayed during its last reported quarter, it will survive the cash crunch. This opens up the possibility of a company likely to generate operating cash flows at a margin of at least 8.5% on revenue which could exceed $200 million during its next financial year. Hence, it is hard not to conclude that the company has strong upside potential with relatively limited downside risks.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

[FUNMAN]

TILT Holdings - We applaud the efforts of Veterans Affairs Canada considering expansion of their reimbursement program & for addressing Veterans cannabis needs since 2015! @We_are_Jupiter and their LP partners will continue to bring leading technology + oil to market in 2020.
Quote Tweet

ICBC
@IntlCBC
· Jan 30


"The Veterans Affairs Canada’s reimbursement policy reimburses veterans for up to three grammes of dried cannabis flower per day, or its equivalent in fresh cannabis or cannabis oil." @HealthEuropa
https://healtheuropa.eu/cannabis-vaping-devices-reimbursement-approval-for-canadian-veterans/97085/
11:47 AM · Feb 5, 2020·Twitter Web App

Cannabis vaping devices reimbursement approval for Canadian veterans
30th January 2020

Medical cannabis vaping devices have received reimbursement approval for Canadian veterans.

https://www.healtheuropa.eu/cannabis-vaping-devices-reimbursement-approval-for-canadian-veterans/97085/

Signature By Liberty Leaf, a division of Liberty Leaf Holdings, has announced that it is now approved to direct bill medical cannabis vaping devices for veterans and former Royal Canadian Mounted Police (RCMP) officers, who qualify for up to $300 reimbursement from Veterans Affairs Canada (VAC), via Medavie Blue Cross.

The VAC reimbursement programme is designed to alleviate some of the burdens experienced by Canadian veterans as a result of injuries or other afflictions they have suffered in the service of Canada.

The Veterans Affairs Canada’s reimbursement policy reimburses veterans for up to three grammes of dried cannabis flower per day, or its equivalent in fresh cannabis or cannabis oil.

Medical cannabis devices

It is routinely acknowledged that medical cannabis can play a critical role in managing both physical pain, acute and chronic, as well as psychological distress for veterans. Medical cannabis has been ranked as a leading symptom relief resource for dealing with a number of psychological ailments including Post-Traumatic Stress Disorder (PTSD).

Signature’s medical device product offerings include approved vaporisers and hardware, delivered direct to consumers.

Now that approved dry flower cannabis vaporisers qualify for reimbursement from VAC, Signature is able to assist veterans in receiving up to $300 reimbursement in purchases from its line of medical devices.

Staff at Signature will complete all the necessary paperwork through Medavie Blue Cross and provide qualifying vaporisers to veterans, while making reimbursement applications. There is no need for veterans to pay out of pocket, other than for charges that don’t qualify under the programme.

Ceri Willott, Special Projects Manager at Signature, said: “We at Signature are proud to facilitate and fulfil the medical devices our veterans require in order to help manage their conditions. We worked hard to make this reimbursement programme happen.”

[FUNMAN]

TILT Holdings - Great news for @We_are_Jupiter partner @KanaboResearch and the international medical cannabis market. Congrats!

Great news for @We_are_Jupiter partner @KanaboResearch and the international medical cannabis market. Congrats! https://t.co/ljSBhSbk9X

— TILT Holdings (@TILT_Holdings) February 5, 2020

Cannabis Industry UK
@CannaIndustryuk
· Feb 4
Certified medical Cannabis device is now available exclusively in the UK with Provacan. – http://Journalism.co.uk https://cannabisindustry.co.uk/2020/02/04/certified-medical-cannabis-device-is-now-available-exclusively-in-the-uk-with-provacan-journalism-co-uk/



Certified Medical Cannabis Device Is Now Available Exclusively In The UK With Provacan. – Journalism.Co.Uk

Press Release
CiiTECH is proving to be at the top of the game in discovering, developing and commercialising cannabinoid products for the UK and global market over and over again. And they’ve done it again with the VapePod™!

CiiTECH is proving to be at the top of the game in discovering, developing and commercializing cannabinoid products for the UK and global market over and over again. And they’ve done it again with the VapePod™!

Provacan, A CiiTECH brand, has launched the VapePod™ on its online shop. The VapePod™ is the UK’s first vape pen that has been certified as a medical cannabis device by the Israeli Ministry of Health, to be used with pre-filled Provacan CBD cartridges.

VapePod™, developed by Kanabo research, is certified as a safe and effective vaporisation system that inspires retailer and consumer confidence. It’s innovative features include accurate metered-dosing, allowing accurate terpene and cannabinoid consumption.

The medically validated device is operated with the Provacan pre-filled, no-mess cartridges formulated by CiiTECH together with Kanabo Research.

Proprietary DAY and NIGHT terpene-CBD formula is made with a THC free, broad spectrum Cannabis oil and made from EU compliant hemp strains ensuring full UK & EU compliance. They are enriched with CBD and CBG and developed in Israel in a GLP pharma grade facility. There are 2 distinct cannabis terpene formulations where one is the ‘Day’ formula to be used throughout a busy day and the ‘Night’ formula which compliments one’s evening routine.

The products are made using a patent-pending carrier solution that replaces the traditional e-liquids currently trending in the media for suspensions of releasing toxic materials when heated at high temperatures. Our neutral diluent allows for low irritation, high potency, and consistent dosing through the lifespan of the cartridge with an advanced bioavailability, as indicated by Kanabo pre-clinical trials.

CiiTECH Ltd. is a cannabis biotech company that focuses on discovering, developing and commercializing cannabinoid products for the global market. We do this by partnering and collaborating with leading institutions and companies to realise the full potential of cutting-edge cannabis innovation and bring it successfully to market. “For years it has been clear that best-of-breed cannabis research and product development is happening in Israel. Our customers demand a level of trust in CBD products that we are able to meet through both our own research and collaborations. There’s a real growth in consumer understanding of the terpenes. We believe our proven formulas together with the VapePod™ device deliver an exceptional level of CBD innovation and efficacy not previously seen in the industry.” says Clifton Flack, CiiTECH CEO and founder.

For more information on VapePod visit: www.vapepod.com

For more information on CiiTECH visit: www.ciitech.co.il

For more information on Provacan visit: www.provacan.co.uk

For media or press inquiries please contact: [e-mail]

Contact Name:
Paul Gladstone
Company:
CiiTECH
Contact Email:
click to reveal e-mail
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This article originally appeared here in https://www.journalism.co.uk/press-releases/the-first-medically-certified-vaping-device-for-cannabis-in-the-uk-is-now-available-through-provacan-/s66/a751231/

[FUNMAN]

Scoop: TILT Holdings' Jupiter Research Releases New Vape Devices, Cartridges

Javier Hasse , Benzinga Staff Writer
February 14, 2020 4:14pm

https://www.benzinga.com/markets/cannabis/20/02/15342373/scoop-tilt-holdings-jupiter-research-releases-new-vape-devices-cartridges

TILT Holdings Inc (CNSX: TILT) subsidiary Jupiter Research, an inhalation technology company, will start offering a new suite of products, Benzinga has learned.

A new section on Jupiter's website features new proprietary offerings that are already being offered to wholesalers — but not to retail customers until next week.

The new line includes the Liquid Que, the Liquid 6 Infinity cartridge and Liquid X Infinity all-in-one. Featuring Jupiter’s CCELL technology, the Liquid Que and Infinity platform are positioned to be the standout products for the company in 2020.

The new products offer new vaporization technology, including press-fit sealings to prevent end consumers from accessing the oil and adding their own concoctions, including black market oils. Additionally, the products are undergoing child safety certification to ensure they cannot be opened and tampered with.

"Jupiter was founded to innovate and advance technologies in inhalation for the cannabis industry. We are proud of our initiatives to continue to set quality and safety standards as a best-in-class company," Mark Scatterday, the interim CEO of TILT Holdings, told Benzinga.

"Our current and new disruptive inhalation products, along with our partnerships and purposeful initiatives, aim to continue to advance us in this dynamic and expanding category.”

The stock was up 2.71% at 22 cents Friday afternoon.