Vancouver-based cannabis producer Emerald Health Therapeutics (TSXV:EMH) (OTCQX:EMHTF) has just announced its latest financial results for the Q4 and fiscal 2018 period. Is EMHTF stock on the move?
Let's check this out.
EMHTF Stock on the Move
At the time of writing, EMHTF stock is on the move, up 1.34% and selling for $2.96 USD on the OTC. The gains have the potential to skyrocket, though, as the news is fresh and the market needs time to react.
The results were promising—operations are moving in the right direction. Sales in Q4 2018 and Q1 2019 were up significantly year-over-year and sequentially. Akin to that, the Pure Sunfarms joint venture is expected to bring in $14 million in sales in Q1 alone. Let's look at this closer.
EMHTF Stock: Sales
Specifically, sales have more than doubled on a sequential quarterly basis across 2018 and into 2019. For example, Q1 2019 sales were logged at $2.6 million, and the previous quarter (Q4 2018) sales figure was $1.1 million.
This trend may easily continue because the company's Quebec-based Verdélite subsidiary will only reach full production in its 88,000 square foot facility by mid-2019. Considering operations are still in development, Emerald Health Therapeutics' performance is particularly strong. EMHTF stock could be set for explosive gains.
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Supply Agreements and Pure Sunfarms
The company has supply agreements that represent over 90% of Canada's population. With deals in seven provinces and territories, the company also proudly states that its "delivery fulfillment rates are close to 100%."
But the stand-out highlight from the company's release has to be the significant revenue increase experienced by Emerald's Pure Sunfarms joint venture.
Pure Sunfarms is a 50/50 joint venture between Emerald Health Therapeutics and Village Farms (NASDAQ:VFF). The pair joined forces to develop a "vertically integrated, large-scale, low-cost supplier of high-grade cannabis." Combined, the venture has experience spanning cannabis farming and the medicinal cannabis sector.
Sales almost tripled between Q4 2018 and Q1 2019, with reported figures of $4.9 million and an expectation to exceed $14 million, respectively. Emerald's take-home share of the Q4 figure is $1.4 million. So EMHTF stock investors can expect nearly triple that from the Q1 sales.
Operational Targets
Akin to the positive sales figures, the company is on track to hit all its operational targets. This includes an "annualized production run-rate in [the Verdilite] greenhouse of 75,000 kg by mid-year." And subsequently, "advancing plans to convert a second, nearly identical 1.1 million square foot greenhouse in the same complex."
On the joint venture, Avtar Dhillon, MD, President and Executive Chairman of Emerald, said the following:
"In the past year, we have worked closely with our 50/50 venture partner to bring into full production one of the single largest cannabis growing assets in the world. Pure Sunfarms’ 1.1 million square foot facility is now rapidly increasing production and sales."
Has EMHTF stock been on your radar? Should you sit up and take note?
Featured Image: Canva
