CALGARY, Jan. 13, 2020 /CNW/ - Westleaf Inc. (the
"Company" or "Westleaf") (TSX-V:WL) (OTCQB:WSLFF)
announced today that following the closing of the merger of
Westleaf and We Grow B.C. Ltd. ("We Grow"), Scott Hurd, President and Co-Founder, has
resigned effective January 24,
2019.
"On behalf of Westleaf, we thank Scott for his vision,
leadership and efforts that have positioned Westleaf favourably
with a high quality asset base that is ripe for growth in 2020"
said Cody Church, Chairman of the
Board of Westleaf. "Scott co-founded Westleaf and led the
organization since August 2017. We
are grateful for his strategic vision that has left the company in
a strong financial position with sustainable competitive
positioning. Scott was a driving force behind the recently closed
merger with We Grow on December 20,
2019. We wish Scott continued success in his future
endeavours."
"As a founder of Westleaf, it is with a heavy heart that I
announce my resignation today," states Scott Hurd. "It has been an honour and a
privilege to lead Westleaf through a period of immense growth in a
new and dynamic industry. Our recently completed
transformative merger with We Grow has positioned Westleaf to be
one of the leading ultra-premium cannabis producers in Canada with best in class realized retail
pricing, strong brand awareness and significant scalability and
growth potential. With the merger now closed and a new leadership
team in place, I have made the difficult decision to step back from
the company. I have great confidence in the new management team and
board to lead Westleaf through its next stage of growth. I wish
Cody, Ben and the rest of the Westleaf team and board continued
success in 2020 and beyond."
Scott will work to formally transition his responsibilities over
the coming weeks and will be available to support the organization
as needed as a strategic advisor. Ben
Sze, the former CEO of We Grow and current CEO of Westleaf,
will succeed Scott as the President of Westleaf.
Corporate Update
Realized Pricing
With We Grow's commitment to quality, it has bucked the industry
trend of price compression, with the Q3 2019 financial results of
We Grow demonstrating a gross realized price per gram of
$11.65 (net realized price per gram
of $10.06). Notably, in Q4 2019, the
Company released additional flower strains into the recreational
market and received an incremental $0.50 price per gram for four premium product
SKUs. The Company will continue to focus on maintaining We Grow's
position as a leader in the premium cannabis category with its
Qwest and Qwest Reserve branded products.
Cost Reduction Initiatives
The Company continues to undertake cost reduction initiatives as
it maintains focus on profitability and solidifying its position as
one of the leading premium cannabis companies in Canada. As the integration of We Grow
continues, Westleaf has focused on unlocking the combined synergies
of the merger including the elimination of 9 positions
(approximately 30% of corporate staff), resulting in projected
annualized savings of approximately $1.3
million. The Company is finalizing its 2020 budget with a
view to ensuring adequate adjustments are made to its cost
structure to allow the Company to execute on its strategy and
deploy capital towards optimizing its asset base. Effective
immediately, executive leaders Shon
Williams, Chief Development Officer, and Ben Kaanta, Chief Operating Officer, will be
departing the Company and have transitioned their responsibilities
to the current Westleaf executive team.
About Westleaf Inc.
Westleaf is a fully integrated Canadian cannabis company focused
on cannabis brands, extraction and production of derivatives,
wholly owned retail, as well as premium cannabis cultivation.
Westleaf's operating cultivation facility is located
in Creston, British Columbia in the heart of the
Kootenays. It consists of 26,000 square feet retrofitted for phase
1 cultivation, including over 14,000 square feet of growing rooms.
The Company is also building an 80,000 square foot purpose built
indoor cultivation facility located in Battleford, Saskatchewan. Westleaf's cannabis
production includes its brand Qwest, which is considered a
preeminent luxury cannabis brand. Westleaf's extraction and
processing facility, The Plant, is designed to produce
high quality and consistent cannabis derivatives and consumables,
both for Westleaf's in-house brands as well as white label
products. Westleaf's retail concept, Prairie Records, leverages the
instinctual tie between recreational cannabis and music with stores
operating or in development across Western Canada.
Neither TSXV nor its Regulation Services Provider (as that
term is defined in the policies of the TSXV) accepts responsibility
for the adequacy or accuracy of this release.
Cautionary Statements
This news release contains "forward-looking information" and
"forward-looking statements" (collectively, "forward-looking
statements") within the meaning of the applicable Canadian
securities legislation. All statements, other than statements of
historical fact, are forward-looking statements and are based on
expectations, estimates and projections as at the date of this news
release. Any statement that involves discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions, future events or performance (often but not always
using phrases such as "expects", or "does not expect", "is
expected", "anticipates" or "does not anticipate", "plans",
"budget", "scheduled", "forecasts", "estimates", "believes" or
"intends" or variations of such words and phrases or stating that
certain actions, events or results "may" or "could", "would",
"might" or "will" be taken to occur or be achieved) are not
statements of historical fact and may be forward-looking
statements. In this news release, forward-looking statements relate
to, among other things anticipated pricing, future capital
requirements; Mr. Hurds ongoing involvement in the Company; the
Company's business strategy, plans, cost cutting strategy, 2020
budget and ability to execute on the foregoing; . Forward-looking
statements are necessarily based upon a number of estimates and
assumptions that, while considered reasonable, are subject to known
and unknown risks, uncertainties, and other factors which may cause
the actual results and future events to differ materially from
those expressed or implied by such forward-looking statements. Such
factors include, but are not limited to: risks relating to the
ability to obtain or maintain licences to retail cannabis products;
review of the Company's production facilities by Health Canada and
receipt or maintenance of licences from Health Canada in respect
thereof; future legislative and regulatory developments involving
cannabis; inability to access sufficient capital from internal and
external sources, and/or inability to access sufficient capital on
favourable terms; the labour market generally and the ability to
access, hire and retain employees; general business, economic,
competitive, political and social uncertainties; the satisfaction
of conditions precedent under the Company's credit facilities;
timing and completion of construction and expansion of the
Company's production facilities and retail locations; and the delay
or failure to receive board, regulatory or other approvals,
including any approvals of the TSXV, as applicable. There can be no
assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on the forward-looking statements and
information contained in this news release. Except as required by
law, the Company assumes no obligation to update the
forward-looking statements of beliefs, opinions, projections, or
other factors, should they change, except as required by
law.
Non-GAAP Financial Measures
This press release contains the terms "gross realized price
per gram" and "net realized price per
gram". These indicators are not recognized
measures under International Financial Reporting Standards
("IFRS"), and do not have a standardized meaning prescribed
by IFRS. Accordingly, the Company's use of these terms may not be
comparable to similarly defined measures presented by other
companies. Gross realized price per gram and net realized price per
gram are used by management to better understand the cannabis price
per gram realized throughout a period. The Company believes that
these measures, in addition to conventional measures prepared in
accordance with IFRS, provide investors with an improved ability to
evaluate the underlying performance of the Company. Gross realized
price per gram is calculated as wholesale sales divided by the
aggregate number of grams shipped during the period. Net realized
price per gram is calculated as wholesales sales less excise taxes
divided by the aggregate number of grams shipped during the
period.
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SOURCE Westleaf Inc.
