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About Auxly Cannabis Group Inc. (TSX: XLY, OTCQB: CBWTF)
Auxly Cannabis Group Inc. is a leading Canadian consumer-packaged goods (CPG) company specializing in cannabis products. Headquartered in Toronto, Auxly operates across the full cannabis value chain, focusing on cultivating, processing, and distributing a diverse portfolio of high-quality cannabis products. The company’s mission is to help consumers live happier lives through trusted and innovative cannabis solutions.
Core Business and Product Portfolio
Auxly’s product portfolio spans key categories, including dried flower, pre-rolls, vapes, oils, and other Cannabis 2.0 products. The company has established itself as a leading player in the Canadian recreational cannabis market, leveraging its advanced cultivation facility, Auxly Leamington, to produce high-quality cannabis at a competitive cost. Auxly’s flagship brands, such as Back Forty and Kolab Project, are recognized for their innovative formats and consumer-centric designs, particularly in the fast-growing vape and pre-roll segments.
Operational Excellence and Market Position
Auxly’s operational strategy is underpinned by its vertically integrated model, which allows the company to control every aspect of production, from cultivation to distribution. The Auxly Leamington facility, a state-of-the-art greenhouse, serves as a cornerstone of the company’s low-cost cultivation strategy. This facility has enabled Auxly to achieve industry-leading gross margins and consistently meet the demands of both retail and wholesale markets.
In the competitive Canadian cannabis landscape, Auxly has secured a top-five position among licensed producers by retail sales. The company’s focus on efficiency and innovation has driven significant market share gains, particularly in the all-in-one vape category, where its Back Forty brand holds a dominant position. Auxly’s products are distributed nationwide, including in Quebec, marking a significant milestone in its expansion strategy.
Innovation and Consumer-Centric Approach
Auxly is committed to product innovation, continuously enhancing its offerings to meet evolving consumer preferences. Recent launches include advanced pre-roll formats and all-in-one vape hardware with customizable features. The company’s emphasis on quality, safety, and efficacy has fostered strong consumer trust and loyalty, positioning Auxly as a preferred choice in the Canadian cannabis market.
Financial Performance and Strategic Growth
Auxly has demonstrated a strong financial trajectory, achieving record-breaking revenues and adjusted EBITDA in recent quarters. The company’s focus on sustainable growth, operational efficiency, and cost management has resulted in improved profitability and cash flow. Strategic initiatives, such as the conversion of debt into equity by Imperial Brands, have further strengthened Auxly’s financial position, enabling it to invest in future growth opportunities.
Challenges and Competitive Landscape
Despite its successes, Auxly operates in a challenging environment characterized by regulatory complexities, price compression, and competition from both legal and illicit markets. The company addresses these challenges through its low-cost cultivation model, innovative product development, and strategic partnerships. Auxly’s ability to adapt and thrive in this dynamic market underscores its resilience and commitment to long-term success.
Future Outlook
Looking ahead, Auxly remains focused on driving sustainable growth and profitability. The company plans to expand its product portfolio, deepen relationships with key retail partners, and optimize its operational efficiencies. With a strong foundation in place, Auxly is well-positioned to capitalize on the evolving cannabis market and deliver value to its stakeholders.
Conclusion
Auxly Cannabis Group Inc. stands out as a dynamic and innovative player in the Canadian cannabis industry. Through its commitment to quality, operational excellence, and consumer satisfaction, Auxly continues to set benchmarks for success in the competitive cannabis market.
Auxly Cannabis Group (OTCQX: CBWTF) announced amendments to a $123 million debenture and investor rights agreement with Imperial Brands. Key changes include a 24-month extension of the maturity date to September 25, 2024 and an annual right for Imperial to convert unpaid interest into common shares. The Company also completed the sale of its interest in Curative Cannabis for $6 million, strengthening its financial position without diluting shareholders. The amendments received minority shareholder approval on June 28, 2021.
Auxly Cannabis Group (OTCQX: CBWTF) announced the results of its annual general and special meeting held on June 28, 2021, where 132,758,409 common shares (17.62% of total shares) were voted. All resolutions, including the election of directors and the approval of Ernst & Young as auditors, received requisite majority support. Notably, the Imperial Amendment Resolution garnered 99.26% approval, excluding votes from Imperial Brands. The company continues to focus on delivering high-quality cannabis products in the wellness and adult-use markets.
Auxly Cannabis Group Inc. (OTCQX: CBWTF) announced its Annual General and Special Meeting of Shareholders on June 28, 2021, at 2:00 p.m. EST. To limit COVID-19 risks, physical attendance is discouraged. Only registered shareholders and appointed proxyholders can attend, requiring 48 hours' advance notice. The meeting will feature an audio teleconference, but voting will not be allowed via this method. Shareholders are encouraged to vote in advance. Questions can be submitted beforehand for potential responses during the call.
Auxly Cannabis Group Inc. (OTCQX: CBWTF) reported Q1 2021 financial results with net revenues of $10 million, a 1% increase from Q1 2020. The company maintained a strong market presence in Cannabis 2.0 products, holding 12.6% market share. SG&A expenses decreased by 5%, contributing to a reduced net loss of $10.5 million, down from $13.2 million in the previous year. Despite facing challenges from COVID-19 and inventory management changes, retail sales showed resilience. The company raised $8 million through a private placement to strengthen its balance sheet.
Auxly Cannabis Group Inc. (OTCQX: CBWTF) has announced a definitive agreement for Myconic Capital Corp. to acquire KGK Science Inc. for up to $16.5 million. The deal includes $12.5 million in purchase price, $1.5 million milestone payment for achieving $8 million in revenue, and $2.5 million in future service credits. This transaction is expected to close around June 7, 2021, pending regulatory approvals. Auxly aims to use the capital to optimize operations and enhance profitability, leveraging KGK’s expertise in the cannabis sector.
Auxly Cannabis Group Inc. (OTCQX: CBWTF) has appointed Andrea Fraser as Chief People Officer, effective immediately. Ms. Fraser, previously Director of Global Human Resources at Tilray, will oversee human resources, talent acquisition, and workplace inclusion initiatives. She will also manage responses to COVID-19 impacts on employees and operations. CEO Hugo Alves expressed confidence in Ms. Fraser's ability to enhance the company's culture, aiming for improved performance and success. Auxly is committed to producing high-quality cannabis products for wellness and adult-use markets.
Auxly Cannabis Group has launched the Dosecann Daily Relief CBD Cream, a high-strength topical cream containing 1,200mg of CBD per 60 ml unit, making it the most potent CBD topical in Canada. The cream is aimed at providing relief from various symptoms, including pain and inflammation. Developed in Auxly's Charlottetown lab, the product uses a unique formulation to enhance CBD absorption while moisturizing the skin. Available now in British Columbia and Saskatchewan, it will soon launch in Alberta. This product expands Auxly's portfolio in the cannabis 2.0 segment.
Auxly Cannabis Group reported a remarkable 508% surge in net revenues for 2020, totaling $50.8 million, with cannabis sales contributing $46.6 million. The company secured the top position in Canada for Cannabis 2.0 product sales, capturing approximately 14% market share. Despite achieving gross profits of $11.1 million, Auxly faced a net loss of $85.4 million, though this was an improvement from $102.6 million in 2019. The company is focused on enhancing cash flow and exploring international market strategies, despite challenges faced by its subsidiary, Sunens.
Auxly Cannabis Group Inc. (OTCQX: CBWTF) announces amendments to its $123 million debenture agreement with Imperial Brands, extending the maturity date by 24 months to September 25, 2024. The amendments maintain the 4% annual interest rate, due upon maturity, and allow Imperial Brands to convert unpaid interest into common shares at the volume-weighted average trading price. This initiative aims to improve Auxly's cash flow and strengthen its balance sheet, enhancing growth potential as it seeks minority shareholder approval for these changes at the upcoming shareholder meeting.
Auxly Cannabis Group has received final approval to graduate from the TSX Venture Exchange to the Toronto Stock Exchange (TSX) as of April 20, 2021. The company's common shares will continue to trade under the symbol XLY on the TSX, while shares will still be available on the OTCQX market under CBWTF. Trading on the TSXV will cease on April 19, 2021. This transition marks a significant milestone in Auxly's commitment to expanding its presence in the cannabis market and enhancing shareholder value without requiring further action from shareholders.
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