NEW YORK, Feb. 19, 2020 /PRNewswire/ -- Capital investments in the cannabis industry reached USD 10.4 Billion in 2010, which is a 40% increase from 2018. Yet, according to Marijuana Business Daily, the previously hot investment activity has cooled in recent months and is now running at what one analyst called a more "normal" pace of growth. This strong growth in investments can be explained by analyzing several recent developments which suggest that the cannabis industry is constantly growing around the world. For example, Australian health regulators expect the number of medical cannabis prescriptions to climb to at least 70,000 in 2020, which is more than double the 30,000 approvals through the end of 2019. Additionally, Germany imported 6,714 kilograms (14,802 pounds) of medical cannabis flower, primarily for pharmacy dispensing in 2019, according to fresh data from the nation's medical regulatory agency. That is more than double of the total for 2018, when about 3 metric tons were imported. In the United States, expectations are high for several states to expand their medical cannabis programs this year through new laws or regulatory policies, opening the door to additional business licenses as well as more sales for existing cannabis operators and new business. And, the global cannabis market size was USD 10.60 Billion in 2018 while it is projected to reach USD 97.35 Billion by the end of 2026 while exhibiting a CAGR of 32.9296 in the forecast period 2019 to 2026, according to Fortune Business Insights. Global Payout, Inc. GOHE, HEXO Corp. HEXO, iAnthus Capital Holdings, Inc. ITHUF, Planet 13 Holdings Inc. PLNHF, KushCo Holdings, Inc. KSHB.
However, despite the projected growth and legalization efforts, the problem of the illegal market still remains, as many consumers still tend to purchase their products from illegal vendors. In particular, one year after Canada fully legalized cannabis, 60% of Canadians still obtained their products from black market dealers or sources that were not entirely legal. However, the percentage has steadily fallen since Canada legalized cannabis back in October 2018. Currently, consumers purchase their products from the black market because it is typically much cheaper than obtaining goods from legal vendors. "When it comes to retail, consumers will always pay more for premium-quality products. In the cannabis industry, that means top-shelf genetics cultivated in small batches will fetch higher prices," said Anne Forkutza, former Vice President of Strategic Partnerships and Brand Officer at Cova Software. Another problem is lack of accessibility. For example, Marijuana Business Daily reported earlier this month that Massachusetts regulators approved a business license for the first recreational cannabis store in Boston, years after the state voted Massachusetts voters passed a ballot initiative (Question 4) making recreational cannabis legal in the state.
Global Payout, Inc. GOHE, recently changed its name to Global Trac Solutions, Inc., announced yesterday that, "as part of a larger effort to restructure and diversify the Company, its subsidiary company MTrac has extended its business initiatives to highlight its strength in sales and marketing, transforming it into a true marketplace for high risk industries.
'MTrac has evolved. Having been in the cannabis sector, specifically in payment processing, we quickly became recognized by our industry peers as the go-to company for resources in banking, payments, software, insurance, POS, government relations, and more. Over time the value of our network has become readily apparent, as our group has been well vetted, compliant, and a resource for the financially underserved. It is through this network that we have decided to diversify outside of the payment space and really become a marketplace for strategic partnerships and total package solutions for the cannabis industry and other high-risk spaces,' said Global Trac Solutions CEO, Vanessa Luna. 'We have improved our banking bandwidth and have new software integration partners, in addition to strategic alliances on the horizons. We will continue to receive revenue from payment processing through third party partnerships and referrals however, going forward this will not be the sole focus of our business model. We will also be expanding our reach to include ancillary services and expect to realize revenue from those relationships as well. This move comes from years of experience working in the cannabis industry and other high-risk market sectors. Diversification is key for survival, and we are confident in our directional shift.'
We will keep shareholders apprised of the ongoing efforts to diversify our subsidiary and plan to effectively utilize our network to realize all future revenue potential.
Please feel free to visit our newly designed website at www.mtractech.com.
About Global Trac Solutions, Inc. GOHE: Global Trac Solutions is a diversified holding company, dedicated to identifying new and emerging technologies specific to a variety of industry verticals ranging from Branding and Marketing, Fintech, Business Development, Sales and Distribution, High-Risk, Nutraceuticals, and more. We focus and leverage our team's diverse experience to effectively execute go-to-market strategies in order to position the companies we engage with for rapid growth and a structure to enhance profitability potential. We believe in a forward-thinking approach that embraces groundbreaking new technology and innovations while providing our partners with the infrastructure and vision necessary to evolve into the industry leaders of the future. We truly are the right TRAC to follow."
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HEXO Corp. HEXO is an award-winning consumer packaged goods cannabis company that creates and distributes innovative products to serve the global cannabis market. HEXO Corp. announced last year that it had received licenses from Health Canada for its cannabis Centre of Excellence in Belleville, Ontario, for research, and for the sale of cannabis topicals, extracts, edibles and beverages from its flagship Gatineau campus. While a Processing Licence provides for testing on live plants, fresh and dried plant material, seeds, and oil, a Research and Development Licence significantly expands the scope of work that can be conducted on cannabis and its derivatives. The Company plans to conduct research and development at its Vaughan and Montreal Innovation, Development and Engineering hubs, as well as at its Centre of Excellence in Belleville and in other facilities. "The research licence will allow us to take our innovation work to the next level, with testing on derivative products, including taste testing. Consumers have high expectations for their packaged goods experiences, and cannabis will be no different," said Sebastien St-Louis, Chief Executive Officer and Co-Founder of HEXO Corp. "We are committed to not only ensuring a quality consistent experience but to also guaranteeing that experiences powered by HEXO meet these expectations."
iAnthus Capital Holdings, Inc. ITHUF owns and operates best-in-class licensed cannabis cultivation, processing and dispensary facilities throughout the United States, providing investors diversified exposure to the U.S. regulated cannabis industry. Recently the Company announced it has received approval to commence operations at its Pleasantville, NJ cultivation campus. MPX New Jersey, an affiliate of iAnthus, is the ninth Alternative Treatment Center (ATC) in the state to receive a cultivation permit. This marks the tenth state in iAnthus' operational footprint. On February 3, 2020, the New Jersey Department of Health issued MPX New Jersey a permit to cultivate at the Company's Pleasantville cultivation facility. The 33,000-square-foot facility, when fully built, will include an extraction lab and kitchen as well as cultivation. The facility is expandable to 83,000 square feet and the first harvest is expected in the second quarter of 2020. "We are thrilled to be entering the New Jersey market, my home-state and our milestone tenth state market," said Beth Stavola, Chief Strategy Officer of iAnthus and CEO of MPX New Jersey. "With this expansion, we will bring to New Jersey not only clean, safe, and high-quality cannabis products, but jobs and increased economic activity in the Pleasantville and Atlantic City areas. We greatly look forward to servicing the medical marijuana community and being part of a path forward toward full adult-legalization."
Planet 13 Holdings Inc. PLNHF, a vertically-integrated Nevada cannabis company, reported recently that dosist™ ("dosist") as the first cannabis shop-in-shop, an independent retailer within the SuperStore dispensary. The dosist wellness experience will act as a sales and education platform, introducing the brand's dose-controlled cannabis therapy to the over 1 million visitors Planet 13 welcomes each year. "The SuperStore continues to prove itself as an epicenter for brand building in the state of Nevada and the entire country, serving 695,000 customers and generating approximately 9% of Nevada's cannabis sales in 20192," said Larry Scheffler Co-CEO of Planet 13. "Over 2019, we transitioned all the brands in the SuperStore to a stocking fee system to accurately reflect the value of being sold in the highest-grossing, most visited public dispensary in the State. The partnership with dosist is the next step in leveraging the SuperStore platform to help build a nationwide recognition for 3rd party brands."
KushCo Holdings, Inc. KSHB, a producer of ancillary products and services to the legal cannabis and CBD industries, has partnered with Xtraction Services Holding Corp. a rapidly growing specialty finance company that provides equipment leasing solutions to owners and operators of cannabis and hemp companies in the United States, to offer equipment financing to KushCo's network of thousands of compliant cannabis and CBD operators. Founded in 2017, Xtraction Services specializes in providing equipment financing solutions to cultivators, oil processors, manufacturers, and testing laboratories, among others. The company also provides a full range of consulting services, including equipment selection and procurement through its network of preferred vendor partnerships with original equipment manufacturers (OEMs) and equipment distributors. Along with a comprehensive suite of on-site support services, Xtraction Services is able to provide a complete end-to-end solution for the legal cannabis and hemp industries, which have lacked traditional sources of capital since inception.
"For the past several months, we have been evaluating ways in which we can successfully enter the equipment financing arena, which we identified early on as being another growth driver and margin accretive business that can significantly complement our existing ecosystem of ancillary products and services," said Nick Kovacevich, KushCo's Co-founder, Chief Executive Officer, and Chairman.
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