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1933 Industries is tapping into the US cannabis market's potential as a new era dawns

Snapshot

The cannabis company is progressing with plans to launch one of Nevada's largest hemp extraction facilities, amid a flurry of other activity

cultivation facility

Quick facts: 1933 Industries Inc

Price: 0.24 CAD

CSE:TGIF
Market: CSE
Market Cap: $66.66 m
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  • Well-positioned to take advantage of the blossoming US cannabis market 
  • Has expanded in Nevada, with new cultivation facility and new hemp processing facility 
  • Seen strong sales from hemp-based, CBD products to over 600 retail locations around the US 
  • Poised to capitalize on the hemp/CBD rush 

What 1933 Industries does: 

1933 Industries Inc (CSE:TGIF) (OTCMKTS:TGIF) is a cannabis company with operations in the United States and Canada. Operating via three subsidiaries, 1933 owns licensed medical and recreational cannabis cultivation and production assets, hemp-based, CBD infused products, CBD extraction services and a specialized cannabis advisory firm, that supports clients in security, intelligence and due diligence.

As for the name? The “1933” in the company name is a nod to the year when the prohibition of alcohol ended in the US. Today, 1933 Industries aims to capitalize on opportunities that have come as a result of the end of cannabis prohibition in Canada and industry legalization in a collection of US states. 

Vancouver-based 1933 Industries has three subsidiaries. One is Alternative Medicine Association LC, a licensed medical and adult-use cannabis cultivation and production facility in Las Vegas that produces its own line of products and manufactures other company’s brands. AMA’s products include concentrates such as Cake Batter, Crumble and Sugar; a vape pen sold with distillate oil; and several flower strains.  

With more than 42 million visitors each year, Las Vegas is poised to become one of the world’s largest adult-use cannabis markets and 1933 is well-positioned in the silver state. The firm is aiming to establish its foothold in several different parts of the value chain in the North American medical and adult-use cannabis industries and replicate its model in other jurisdictions. 

Another subsidiary is Infused MFG, a Las Vegas-based manufacturer of hemp and cannabidiol-based medicinal and skincare products. Earlier this year, 1933 Industries acquired Spire Global Strategy, an advisory firm in Vancouver that helps client businesses stay secure, compliant and competitive. The company focuses on four areas of concern for cannabis companies: international production, sales and import-export licensing agreements; domestic licensing; public policy development; and design of large-scale hemp, cannabis and cannabidiol projects for clients. 

How is it doing: 

From collaborating with celebrities to broadening its product offering, it’s been a busy few months at 1933 with infrastructure projects in California and Nevada, the opening of new markets in Arizona and Colorado and expanding its Canna Hemp brand in the US. 

The company is working to position Canna Hemp as a premier CBD product line in the US. The company recently partnered with Zumiez, the apparel and accessories retailer, and revamped its e-commerce website.  

Its sport cream, Canna Hemp X, is a collaboration with skateboarding legend Tony Hawk and Grizzly Griptape to target consumers in skateboarding, BMX and other extreme sports. The company has already signed licensing agreements with Grizzly Griptape and Birdhouse Skateboards, and a Birdhouse Canna Hemp X CBD balm is expected to launch soon.

On the financials front, the company said in September that it expects record revenue of C$5.2 million for its fiscal year fourth quarter and plans to release full results by the end of November. 

Inflection points: 

  • 1933’s cultivation and manufacturing buildout is expected to be completed by the end of October and in production by November 
  • First harvest from the company’s recently completed 67,750-square-foot cultivation facility in Las Vegas is expected in December, with subsequent harvests seen every two weeks 
  • The plant is expected to produce 700 pounds of cannabis flower, with all flower rooms up and running by January 2020 

What the boss says: 

In September, the US House of Representatives voted overwhelmingly in favour of the Secure And Fair Enforcement (SAFE) Banking Act, which protects financial institutions from federal punishment for doing business with cannabis companies. 

Speaking to Proactive about the landmark passage, 1933 CEO Chris Rebentisch said that being able to access traditional means of financing adds an additional layer of safety and security to small cannabis businesses. 

“The SAFE act, right out the gate will add an additional layer of safety and security to our operations,” Rebentisch said. “Running a cash business is expensive. You have more costs associated with managing, monitoring, transporting and securing the cash. The SAFE act will reduce our operations costs. 

“It also adds investor confidence and mitigates their risk of loss of capital. This will absolutely attract more investors to the industry.” 

Contact Angela at [email protected]

Follow her on Twitter @AHarmantas

 

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