Investor Presentation Q4 2018

Transcription

1 Investor Presentation Q4 2018

2 2/22 Forward Looking Statement The information contained herein, together with any amendments or supplements and any other information that may be furnished by the company, includes forward-looking information. Such information is based on assumptions as to future events that are inherently uncertain and subjective. The company makes no representation or warranty as to the attainability of such assumptions, including the completion of a financing or as to whether future results will occur as projected. It must be recognized that the projections of the company s future performance are necessarily subject to a high degree of uncertainty, that actual results can be expected to vary from the results projected and that such variances may be material and adverse. Prospective investors are expected to conduct their own investigation with regard to the company and its prospects. This presentation does not constitute an offer to sell or a solicitation of an offer to buy any security.

3 3/22 01 SUMMARY Executive Summary 4 02 INVESTING IN CANNABIS Growing Demand for Medical Cannabis 6 Recreational Cannabis Market 7 Supply of Cannabis 8 Table of Contents 03 INDIVA ADVANTAGES Talented and Experienced Team 10 High Quality Products 11 Our Corporate Identity 14 Customer Acquisition Strategies LONDON FACILITY London Facility 17 Production Facility Pictures 19 Expansion Path - s, Oil, Products COST BREAKDOWN London Operating Expenses 22

4 4/22 NEAR TERM CATALYSTS Executive Summary Sales INDIVA received its sales license on August 10, 2018 and sales have begun. Expansion Cultivation and oil extraction: Fully funded expansion to 40,000 square feet underway and to be completed in Q4 of Processing Facility Fully funded processing facility planned for Facility to produce INDIVA, Bhang, DeepCell and other cannabis products. Capitalization: Basic Shares Outstanding mm Warrants: mm Options:...4.7mm Convert:...6.9mm Fully Diluted Shares Outstanding mm Balance Sheet: Cash (June 30, 2018)...$27.3mm Convertible Debenture...$5.1mm Management and Insider Ownership...22% STRONG FUNDAMENTALS Award-winning cannabis products State-of-the-art GMP-standard indoor production facility Fully funded expansion Experienced Master Grower with awardwinning strains and loyal patient base Experienced management team, passionate about helping people and protecting investors

5 Executive Summary Investing in Cannabis INDIVA Advantages London Facility Cost Breakdown Q Investing in Cannabis

6 6/22 Health Canada s Projected Registered Patients Actual Registered Patients Growing Demand for Medical Cannabis 16,599 physicians have authorized patient access to medicinal marijuana 330,758 registered patients in total to date ( ~ 80% from ON and AB) 10,000 (approx.) new patients per month Registered Patients 450, , , , , , , ,000 50, GROWTH RATE OF MEDICINAL CANNABIS USERS IS HIGHER THAN EXPECTED Health Canada projected 450,000 patients will be using cannabis at $1.3 billion annual revenue by ,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000, Multiple Sclerosis Epilepsy Cancer Low BMI Severe Pain June 2018: registered patients exceeds Health Canada s 2023 projection 2019 Risk of Depression 2020 Migraine Headaches Insomnia 2021 Anxiety 2022 Arthritis 2023 Hypertension 2024 Life Stress (Elevated) POTENTIAL MARKET _ Source: Health Canada, Statistics Canada, Canadian Community Health Survey, medicalmarijuana.ca

7 7/22 Daily Weekly Monthly Occasionally Non-Consumers Potential Customer Recreational Cannabis 17% 61% 7% 4% 3% 8% SIZE AND MAKEUP OF THE CANADIAN RECREATIONAL MARKET According to the Deloitte Survey, the size of the Canadian recreational cannabis market could be as much as $8.7 billion per year, or similar to the size of the Canadian spirit market. $7-10 Billion Domestic Market Users (Thousands) Consumption (Metric Tonnes) Source: Deloitte, PBO Opportunity! * 2.6 million Canadians admit to use in last 12 months * Represents <5% of total consumption Once Less than once a month 1-3 Times per month At least once a week Daily ANNUAL CANNABIS USERS AND CONSUMPTION Aged 15 and over, Canada excluding Territories, Mid-point Estimates, 2018

8 8/22 Supply of Cannabis OVER-supply of dry flower just around the corner! Current Production 132 existing LPs Current production insufficient to meet demand 70 Sales Licenses issued YT 0 BC 30 NT 0 AB 9 SK 4 Source: Mackie Research, 420intel.com NU 0 MB 2 ON 69 Licensed Producer Production Capacity Tonnes Aurora Cannabis Canopy Growth Aphria Tilray The Green Organic Dutchman...95 Cronos Group OrganiGram HEXO CannTrust Emerald Health Therapeutics TOTAL (metric tonnes)...2,411 QC 12 NB 3 Number of licences issued by province NS 3 NL 0 PE 1

9 Executive Summary Investing in Cannabis INDIVA Advantages London Facility Cost Breakdown Q INDIVA Advantages

10 10/22 FINANCE & CORPORATE DEVELOPMENT Niel Marotta President & CEO, Director, Founder Managed over $1 Billion across several industries Involved in capital raises and M&A transactions exceeding $1 Billion CREATIVE Tom Borowicz Chief Brand Officer Over 30 years of experience in marketing, branding, print/digital advertising and design with Fortune 500 companies Talented & Experienced Team LEGAL & BUSINESS DEVELOPMENT Koby Smutylo COO, General Counsel, Director, Founder Koby is a seasoned lawyer and has acted as counsel to private and public companies Helped finance and license an ACMPR LP FINANCE Jennifer Welsh, CPA Chief Financial Officer Managed a global finance team for eight years as Corporate Controller of a TSX listed company Former consultant for a publicly traded LP PRODUCTION Pete Young Master Grower, Founder Grow Team: 15+ years of experience producing medicinal strains for hundreds of patients International recognition and multiple product awards PROJECT MANAGEMENT Jose Laurentino Chief Technology Officer 20+ years in agricultural project development including indoor and greenhouse expertise CORPORATE DEVELOPMENT Jamie Riff, P.Eng VP Corporate Development 15+ years experience in capital markets and institutional sales

11 11/22 INDIVA High Quality Products Our strain selection, cultivation and client care processes combine the know-how and experience of an internationally recognized and award winning grow-team with GMP-compliant quality assurance standard operating procedures. INDIVA is focused on providing medical-grade cannabis to medical and adult-use clients, both domestically and internationally.

12 12/22 Products Powered by INDIVA Bhang is the most awarded line of cannabis chocolate bars available in the world.

13 13/22 Products Powered by INDIVA Ruby sugars and salts are the world s first Flexible Edible cannabis product created to easily incorporate into your everyday food and drink.

14 14/22 Our Corporate Identity POSITIONING At INDIVA, we believe cannabis can add to one s general wellness and we stand for the destigmatization and normalization of cannabis for medicinal and recreational use. INDIVA is an experienced producer of high quality cannabis products designed to contribute to the health and wellness of its clients. Our logo symbolizes experience, strength, know-how practical knowledge, as well as a strong foundation for investment and growth. It is respectful of the cannabis movement without the clichés of cannabis counter-culture. Our clean aesthetic and pallet strike the perfect balance between mature yet accessible, contemporary but still classic enough to be lasting, and holistic without looking like products that only belong in a health food store. Our website and media content features contributors focused not just on cannabis, but wellness (nutrition, fitness, sleep) and culture (dining, events). Our associations with award winning American brands that we will produce and sell in Canada and internationally with our powered by INDIVA logo.

15 15/22 COMPASSION COMMUNITY RELATIONS Established relations with prominent and experienced members of the compassion community We will offer familiar strains and an overall respectful and familiar patient experience Agreement with London Compassion Society to transfer up to 1,200 clients Customer Acquisition Strategies We are for tweny. You buy. You help MARKETING SEO, E-shop, blog, and social media campaigns launched in 2017; mailing list of up to 2,000 clients Partnerships with popular social media influencers Packaging developed and focus group tested Engaging events team and keynotes at cannabis, wellness, cultural, and community events across Canada Featured interviews in key publications MEDICAL AND COMMUNITY ENGAGEMENT Strong ties to London s medical community Mandate to support patient networks and societies PROVINCIAL RETAIL STRATEGY Farm gate sales Sales teams active in multiple provinces Responding to provincial RFPs and retailers Access to award winning US products

16 Executive Summary Investing in Cannabis INDIVA Advantages London Facility Cost Breakdown Q London Facility

17 17/22 London Facility Cultivation Oil Extraction Processing Product Manufacturing Retail 40,000 square feet 30 Year Lease with right of first refusal to purchase Ample power & water 1 Kilometre from Highway 401 Extraction and processing facility under construction Retail store to be built on site

18 18/22 Indiva Store Oil Extraction and Processing Indiva Store Mother Room Oil Extraction Drying Room Trim Room London Facility Packaging Drying Room 2 Trim Room 2 Room Mother Room 2 Fully Funded Veg Veg Room $13.7 million Expansion Dry 2 Trim 2 Pack Pump Mother 2 Veg Storage/Receiving Pump Admin/Call Center/QA Admin Dry Trim Str/Rec Mother Planned Expansion ( Rooms) Existing Fenceline

19 19/22 Production Facility

20 20/22 Expansion Path s Oil Products Domestic Expansion International Expansion LARGE SCALE CULTIVATION / OFFTAKE Currently evaluating facilities in South Western Ontario for production partnerships INDIVA s criteria: newer glass houses, access to infrastructure, experienced production partner, ability to fund retrofit out of existing cash resources, measured expansion over time INTERNATIONAL DISTRIBUTION & PRODUCTION Active negotiations with German distributors for large quantity multi-year supply Exploring EU production partnership Agreements with US cannabis products companies to use Canada to produce and export internationally Active negotiations with Polish, Costa Rican and Maltese governments for production partnerships

21 Executive Summary Investing in Cannabis INDIVA Advantages London Facility Cost Breakdown Q Cost Breakdown

22 22/22 1. Power 7 2. Bulbs 1 3. Labour 4. Shipping 6 London Operating Expenses 5. Packaging 6. Materials 7. Contingency KEY EXPENSES Cash costs: Power, light bulbs, labour, packaging, shipping, soil & nutrients, composting, QA testing and contingency (20%) G&A: Management, accounting staff/admin, customer service/call center, security, distribution team Rent, insurance & security EMPLOYEES (ESTIMATED) Full production: 47 Senior management (5) Accounting (3) Gardening (10) Security/IT (2) Distribution (5) Customer Service (12) Sales (3) QA (2) Marketing (5) Software

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