Aleafia stock is moving up slightly this morning after Aleafia Health (TSX:ALEF) (OTCQX:ALEAF) announced it has bought a total of 60 acres of farmland adjacent to the existing facility.
Although the cannabis industry has had a tough few months in 2019, the leading companies in this space are still continuing to make deals and take measures that will help them in expanding their businesses further. Aleafia Health is one of the better known vertically integrated cannabis companies in the industry and in a new development, the company announced that it's going to expand its Port Perry Outdoor Grow plant significantly. In order to expand the facility, Aleafia Health has bought a total of 60 acres of farmland adjacent to the existing facility. This parcel of land will help the company in starting what has been dubbed the Outdoor Grow Phase II.
The purchase of the land was completed on September 3 in a deal worth $1.2 million. The entire facility will be spread over 85 acres once the expansion is complete. The first priority for Aleafia Health is to combine the new property with the original one.
Aleafia stock is up 2.50% at $0.80 on the OTC market.
The amalgamation is important since that will allow the company to simply ask for an amendment to the existing license rather than applying for a fresh one from the regulator Health Canada. Once it is completed, the company will have higher production capabilities and will enjoy greater economies of scale.
Record Quarterly Sales
Aleafia Health has had a good time over the past few weeks, and this development comes soon after it posted record sales in its financial results for Q2 2019 in August. The company’s revenues rose by a staggering 159% from Q1 2019 to hit $3.95 million CAD. In addition to that, it managed to post a gross profit of $2.9 million CAD as well, which was a marked improvement from its $58,000 CAD loss posted in the first quarter of the year.
However, it was its cannabis sales that were the crowning glory of the quarter. From the previous quarter, the cannabis sales skyrocketed by 377% to hit $2.53 million CAD.
Aleafia stock has corrected over 65% from its February peak price.
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