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Auxly Provides Development Update on the FV Pharma Joint Venture
VANCOUVER, British Columbia, July 03, 2018 (GLOBE NEWSWIRE) -- Auxly Cannabis Group Inc. (TSX.V:XLY) ("Auxly" or the "Company") is pleased to provide the following construction development update on the joint venture with FV Pharma Inc. (“FV Pharma”), a wholly-owned subsidiary of FSD Pharma Inc. (CSE:HUGE) at the former Kraft food-production facility (the “Facility”) located in Cobourg, Ontario.
The Facility hosts an initial 620,000 square feet of building space, a portion of which is currently licensed for cultivation pursuant to the Access to Cannabis for Medical Purposes Regulations, and can support additional expansion capacity of approximately 3,800,000 square feet on the existing property, pending completion of all phases of the project.
Pursuant to the updated and approved construction budget, Auxly will contribute $55,000,000 to develop the first phase of the project. The first phase has been updated to include the build-out of an initial 220,000 square feet of cultivation and ancillary space which includes a research and development lab focused on advancements in LED lighting, nutrient testing, breeding and genetics research. The first phase will also contain a dedicated space for large-scale extraction capabilities. The Company anticipates that the first phase of construction will be complete and ready for Health Canada approval by the end of December 2018. Pending regulatory approval, the company expects to plant the first harvest in the first phase by the end of January 2019. Auxly retains a 49.9% stream of all cannabis and cannabis-derived products produced at the Facility, under partnership with Auxly, in perpetuity.
As part of the updated construction budget, the Facility will implement several technological advancements in order to increase energy efficiency and post-harvest process automation. These advancements are anticipated to benefit the environment and the community of Cobourg through less demand on the local electricity grid and will reduce operating expenses to the Company.
Chuck Rifici, Chairman and Chief Executive Officer of Auxly commented, “As Canada moves towards legalization of adult-use cannabis and meaningfully expands its medical cannabis program, Auxly remains committed to cultivating quality cannabis flower at a meaningful scale. Cultivating cannabis requires a significant amount of energy in order to ensure proper growing conditions and this is one of the main contributors to overall operations costs. The technological advancements to be implemented at the facility provide us with flexibility in terms of securing a stable supply of energy while maintaining competitive operating costs relative to the rest of the industry.”
“Auxly is a key strategic partner of ours and we cannot express how pleased we are with the overall development and timeliness of this project,” said Thomas Fairfull, President and CEO of FV Pharma. “We remain confident that FV Pharma's joint venture with Auxly will be an industry-leading indoor producer of cannabis and we look forward to developing the various stages of this project as we enter into the era of legalization of recreational cannabis.”
The Company wishes to announce that it has onboarded an employee who works under the supervision of management and acts in the capacity of investor relations. This individual provides shareholder communications services as well as assists in the day-to-day operations of the Company. Employee remuneration is a combination of cash and incentive stock options.
About Auxly Cannabis Group Inc. (TSX.V:XLY)
Auxly Cannabis Group is a collective of entrepreneurs with a passion for the cannabis industry past, present and future. Our mandate is to facilitate growth for our partners by providing them with financial support and sharing our collective industry experience. Our partners all have different visions, voices and brand values, and all share a common goal—to build a world-class industry based on ethics, diversity, quality and innovation.
About FSD Pharma Inc.
FSD Pharma, owns, through its wholly-owned subsidiary FV Pharma Inc., a license to produce marijuana under the Access to Cannabis for Medical Purposes Regulations (ACMPR) which was originally granted on October 13, 2017. Headquartered at the former Kraft plant in Cobourg, Ontario, approximately an hour’s drive from Toronto, FSD Pharma's management’s mission is to transform the facility into the largest hydroponic indoor cannabis facility in the world. FSD Pharma intends to target all legal aspects of the cannabis industry, including cultivation, processing, manufacturing, extracts and research and development. Please visit www.fsdpharma.com for more information.
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Notice Regarding Forward Looking Information:
This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities law. Forward-looking information is frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or information that certain events or conditions "may" or "will" occur. This information is only a prediction. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking information throughout this news release. Forward-looking information includes, but is not limited to: expectations of future growing capacity at the Facility and the projected costs associated with each expansion phase of the Facility; the completion of the planned build-out and expansion phases; the funding requirements for each expansion phase; the projected revenue achievable by the Facility; and the proposed licensing of the Facility and the expected timing to obtain all necessary licenses required for the proposed operation of the Facility. By identifying such information and statements in this manner, the Company is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company or the Facility to be materially different from those expressed or implied by such information and statements.
A number of factors could cause actual results to differ materially from a conclusion, forecast or projection contained in the forward-looking information in this release including, but not limited to, whether: sufficient funding can be obtained to complete each phased expansion of the Facility in the manner proposed or at all; the Company and FV Pharma can satisfy the conditions associated with the Facility’s cultivation license; a sales authorization can be obtained for the license and the related timing considerations; the Company and FV Pharma can obtain all necessary governmental and regulatory permits and approvals for the Facility, including in relation to the construction of each proposed expansion phase, and whether such permits and approvals can be obtained in a timely manner; FV Pharma complies with its obligations under the Agreement; the Facility can be operated as intended; current and future management will abide by the investment objectives and investment strategies of the Company; the Company will supplement its board of directors and management, or otherwise engage consultants and advisors, having knowledge of the industries in which the Company invests; streaming partners will be able to generate cash flow; general economic, financial market, regulatory and political conditions in which the Company operates will remain the same; the Company will be able to compete in the industry; the Company will be able to manage anticipated and unanticipated costs; the Company will be able to enter into additional streaming agreements; the Company will be able to maintain internal controls over financial reporting and disclosure, controls and procedures; streaming partners will be able to meet the requirements necessary to obtain and / or maintain their status as licensed entities; and streaming partners will be able to successfully complete initial construction and / or expansion construction of their respective facilities pursuant to the terms and conditions of their respective streaming agreements. Additional risk factors are disclosed in the annual information form of the Company for the financial year ended December 31, 2017 dated May 24, 2018.
New factors emerge from time to time, and it is not possible for management to predict all of those factors or to assess in advance the impact of each such factor on the Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking information. The forward-looking information in this release is based on information currently available and what management believes are reasonable assumptions. Forward-looking information speaks only to such assumptions as of the date of this release. In addition, this release may contain forward-looking information attributed to third party industry sources, the accuracy of which has not been verified by the Company. The purpose of forward-looking information is to provide the reader with a description of management's expectations, and such forward-looking information may not be appropriate for any other purpose. Readers should not place undue reliance on forward-looking information contained in this release.
The forward-looking information contained in this release is expressly qualified by the foregoing cautionary statements and is made as of the date of this release. Except as may be required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking information to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.