Anybody home on this board? I have a few share
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Posted On: 10/14/2020 6:09:28 AM
Anybody home on this board?
I have a few shares of this Co, off a lead from a friend on another board.
I haven't added any shares, even with the low prices, for several reasons.
1) I have some concerns about some of the talk I've seen of suspicion that the CEO, Kirin, is making back room deals with sketchy friends in the biz to buy their companies at the expense of the company's shareholders (dilution).
2) I fear a large reverse split.
3) The Bophelo site seems to be slow-moving. And the latest relevant PR, while talking about the progress made in financing, GACP, and site preparation, also states that they are looking for partners to finance the build out of the site.
These two statements from that Sept 19th PR seem to be at odds with one another:
Kiran Sidhu, CEO and Founder of Halo, affirms the timeliness of the international expansion: "With CAD$14 million in available funds under our loan agreement and our at-the-market equity program in place, we are now in a good financial position to build out Bophelo, leveraging our California and Oregon relationships with world class cannabis breeders to expand this international business."
Yet...
Once built out, the initial 25 acres (10 hectares) could generate up to $187 million of revenue annually, assuming a yield of 3,300 pounds per acre (7.5 metric tons per hectare); an average sale price of $2,500 per kilogram over two harvest per year; and assuming the international export market expands significantly over the next two to five years. This full build-out is expected to cost $13,000,000. Bophelo’s current off take with MedCan is currently fixed at sale price of $3,000 per kilogram.
How can they tout having money in hand for the build out, then make it seem that they can't get started without an almost-equal amount of additional money? If they have such a high-margin business, shouldn't they be able to self-fund the expansion once they have the GACP "in the 4th quarter of 2020"?
I admit I see potential here... but I'm very cautiously skeptical of the execution and the continued dilution. At sub .05, equity isn't going to finance much any time soon.
Anyone have any thoughts?
I have a few shares of this Co, off a lead from a friend on another board.
I haven't added any shares, even with the low prices, for several reasons.
1) I have some concerns about some of the talk I've seen of suspicion that the CEO, Kirin, is making back room deals with sketchy friends in the biz to buy their companies at the expense of the company's shareholders (dilution).
2) I fear a large reverse split.
3) The Bophelo site seems to be slow-moving. And the latest relevant PR, while talking about the progress made in financing, GACP, and site preparation, also states that they are looking for partners to finance the build out of the site.
These two statements from that Sept 19th PR seem to be at odds with one another:
Kiran Sidhu, CEO and Founder of Halo, affirms the timeliness of the international expansion: "With CAD$14 million in available funds under our loan agreement and our at-the-market equity program in place, we are now in a good financial position to build out Bophelo, leveraging our California and Oregon relationships with world class cannabis breeders to expand this international business."
Yet...
Once built out, the initial 25 acres (10 hectares) could generate up to $187 million of revenue annually, assuming a yield of 3,300 pounds per acre (7.5 metric tons per hectare); an average sale price of $2,500 per kilogram over two harvest per year; and assuming the international export market expands significantly over the next two to five years. This full build-out is expected to cost $13,000,000. Bophelo’s current off take with MedCan is currently fixed at sale price of $3,000 per kilogram.
How can they tout having money in hand for the build out, then make it seem that they can't get started without an almost-equal amount of additional money? If they have such a high-margin business, shouldn't they be able to self-fund the expansion once they have the GACP "in the 4th quarter of 2020"?
I admit I see potential here... but I'm very cautiously skeptical of the execution and the continued dilution. At sub .05, equity isn't going to finance much any time soon.
Anyone have any thoughts?
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