Creso Pharma Limited’s (ASX:CPH) wholly-owned Canadian subsidiary, Mernova Medicinal Inc. has received three purchase orders with a total combined value of C$275,023 (A$288,159), as well as a Notice to Purchase from the Province of Ontario, marking the company’s imminent entry into Canada’s largest recreational cannabis market.
The first purchase order valued at C$232,826 (A$243,841) is from Truro Cannabis Company. It is a bulk order for three of Mernova’s high quality, indoor grown, hand trimmed, hang dried, cured, artisanal cannabis strains, in dried flower form, specifically HPG13, Lemon Haze and Mimosa.
Truro Cannabis Company is a licensed producer of medical and recreational cannabis products. The group has an established presence across Canada and will sell Mernova’s products through their well established distribution channels.
Creso Pharma also received a maiden purchase order from the Yukon Liquor Corporation, opening a new Canadian market, with the company anticipating further orders in the future. The purchase order is valued at C$24,333 (A$25,436) and is for the HPG13, Lemon Haze and Mimosa strains, in dried flower form.
These products will be sold under the Ritual Green brand in 3.5 gram and 7 gram units, through leading retailer Triple J’s Canna Space. Creso Pharma anticipates further repeat orders from the Yukon in the short term.
The third purchase order was secured from the Nova Scotia Liquor Corporation (‘NSLC’) for the Lemon Haze and Mimosa strains and is valued at C$17,863 (A$18,708). This is the fourth purchase order received from the NSLC, indicating a trend towards a recurring revenue model from the NSLC.
Mernova has also received a Notice to Purchase from the Province of Ontario for its HPG13, Lemon Haze and Mimosa strains. Mernova is currently finalising formal registration and listing phases and expects the receipt of an initial purchase order in the near term. It is anticipated that Mernova’s Ritual Green products will be sold in stores at Ontario Cannabis Store (OCS) locations across the region, and through their online sales platform.
Mernova Managing Director, Jack Yu, said that once finalised, this order will mark Creso Pharma’s entry into Ontario, a significantly large new sales channel. Ontario is regarded as Canada’s largest recreational market and has over a quarter of the country’s market share, with almost C$400 million in legal sales recorded from April 1, 2019 to March 31, 2020.
Mr Yu said these developments serve as confirmation of the significant demand for Mernova’s high-quality cannabis products in the rapidly growing Canadian retail recreational market. The Company looks forward to providing further details around potential purchase orders as they materialise.
Mernova continues to make very strong progress in the Canadian recreational market. The three most recently secured purchase orders will contribute to Creso Pharma’s growing revenue profile and we expect additional orders to materialise in the very near term,” Mr Yu said.
“We are proud to announce that Mernova has been chosen to become part of a very select group of licensed producers with cannabis products for sale in the Yukon. This is a major achievement for us, and we expect growth to continue across Canada and, with our pending entry into Ontario, Canada’s largest recreational market, we expect rapid growth to continue.”