Ventura Cannabis is also presently working with regulators to close its acquisition of CannaSun, which operates in Los Angeles. The acquisition, which would consist of four dispensaries, is expected to generate $12 million in annual revenue from vape products.
BIG PICTURE: Ventura Cannabis and Wellness is building a brand in California through smart acquisitions
By 2021, cannabis investment and market research firm Arcview predicts that vape sales will surge to $5.3 billion and will account for 25% of all legal cannabis sales.
Building a dispensary network
Ventura Cannabis has started to build a network of California dispensaries to serve as a distribution channel for the products developed by the CannaSun brand.
In fact, the Sacremento dispensary which will operate out of a 1,546 square foot space, is expected to be generating revenue and selling CannaSun brand products in this fiscal year. The company projects the facility will bring in $1.5 million in revenue in its third year of operation.
The Sacramento dispensary is the latest in a series of moves to build a vertically integrated cannabis network in California. In June, Ventura spent $1 million on an Oakland dispensary.
The company has also begun selling off its outpatient addiction treatment facilities, known as BLVD Centers. Ventura has executed binding purchase agreements for $5.5 million while retaining rights to sell cannabis products to inpatients for the next 10 years.
"We have been quite productive since our launch just three months ago," President Chris Heath said. "We are awaiting our regulatory approvals to close the several dispensaries and the cannabis product company we have under contract. Once closed, we do expect to generate about five million in annualized revenues from our dispensaries and five million in annualized revenues from our product company. We plan to divest the remaining BLVD Centers business units this year as well, using the cash to continue to build our dispensary network and build our revenues to the target of ten million dollars annualized."
The Los Angeles-based company saw its shares stumble 3.5% to C$0.42 and 10% to US$0.31 on OTC Markets on Tuesday afternoon.
Contact Andrew Kessel at [email protected]
Follow him on Twitter @andrew_kessel