$PVSP SEATTLE, WASHINGTON, Sept. 06, 2022 (GLOBE NEWSWIRE) -- Pervasip Corp. (OTC: PVSP) (“Pervasip” or the “Company”), a developer of companies and technologies in high value emerging markets, together with Zen Asset Management today announced its 2-year strategic roadmap.
“On the heels of Artizen Corporation’s reverse merger to acquire Pervasip Corp, the cannabis industry experienced a dramatic post pandemic contraction. Planned restructuring efforts had already launched in late 2021 and we took even more aggressive steps to further rationalize our business, dispose of undervalued assets, re-focus on higher margin products and allowed our leading brands to take a more aggressive posture to increase market share. Healthy inventory amounts provided for extraordinary financing via cashflow, albeit at extremely low margins, a carefully considered short term decision which has now come to an end as we have achieved our goals. All these efforts position us nicely for healthy financial growth in 2023. As promised, we have also finalized a 24-month roadmap and are in a position to provide carefully considered guidance in a market that is still extremely unpredictable,” said German Burtscher, Pervasip CEO. “It is also important to note that all the Artizen brands’ revenue is wholesale, revenue derived from sales to retailers. The vast majority of MSOs report revenues and resulting financials that include retail sales from stores they own in addition to usually rather small wholesale revenue, all mostly generated in protected markets. Washington State (WA) cannabis sales are taxed at 47% (!) and each dollar sold by a producer/processor is marked up 3 – 3.5 times by the retailers they sell to. Generating profitable revenue in WA will translate extremely well once our brands and operating expertise is applied in other recreational markets.”
Market Overview – Washington
The below Washington State (WA) sales by category chart provides information on how monthly sales of approximately $100 million in retail sales breaks down by product category. It might also be informative to understand that June ’22 sales over June ’19 sales (pre pandemic) show an almost 17% increase. While WA sales are slightly above other mature cannabis states (NV, CO, OR), similar increases can be seen in those markets. An exuberant pandemic triggered belief in continued rapid growth has led to over development of production infrastructure and resulted in material oversupply of bulk cannabis flower. The market is in the process of correcting and the Company estimates Q3 2023 being the end of the corrective period, resulting in strengthening prices.
$100M In Monthly Sales By Category
After several years of recreational sales, the mature markets provide relevant insights into future sales distribution across key categories with flower and pre-rolls still leading at 59%, followed by concentrates (dabs/vape) at 29% and finally edibles and beverages at a combined 9%
Artizen brands will materially expand their flower market share and enter the concentrates and edibles market with a goal of occupying top 10% market share positions in each vertical.
Strategic Outlook Summary through Q4 2024
Focus on expanding its Washington State footprint, strengthening its brand repertoire and aggressively expanding its product lineup
We expect in-state revenues generated by all brands and across all product categories to reach $30 million in annualized revenue by end of Q4 2024 with Gross Margins reaching 40% and an adjusted EBIDTA of 30%
Pervasip/Artizen Corp plans to expand its national reach by adding various recreational states to its brand footprint, either via licensing agreements or through acquisitions of recreational cultivation and retail licenses
95% of revenue from Artizen’s brands has come from sales of cannabis flower, supporting its position of the 9th most sold independent flower brand in North America; acquisitions and partnerships will open access to concentrates and edible verticals representing 40% of market sales and heretofore not covered by Artizen products
Artizen projects it will generate $50 million in annualized revenues nationally by end of Q4 2024; this is a conservative estimate that does not include any potential revenue multiples from acquisition of retail opportunities.
24 Months plan detail
Rename Pervasip Corp to Artizen Corporation by year end 2022 to better reflect the new focus of the company
Change the OTC ticker symbol
Re-brand all Pervasip/Artizen assets
Continue to rationalize the business through Q1 2023 with a focus on operating margins, shedding underperforming assets, consolidating operations and focus in-house talent on higher margin operations and product lines
Acquire concentrates assets by end of 2022, launching into the highly lucrative concentrates business
Expand flower and concentrates offerings within our brands as well as adding new brands for certain product offerings and price points through Q1 2023
Complete the audit and begin the OTC QB application process during Q2 2023
Launch Artizen Wellness Q2 2023
Enter the edibles market in Q2 2023 via acquisition and partnerships
Artizen becomes an MSO with cultivation and retail assets in 1 – 2 additional states during 2nd half of 2024, beginning its state expansion in Q1 2023, initially through brand licensing opportunities and strategic partnerships, and eventually via acquisitions and mergers during Q3 and Q4 2024
Close first brand licensing agreement by end of Q4 2022
Close one brand licensing deal every quarter thereafter
Financial Outlook Q3 2022 through Q4 2023
Reach $2.0 million in monthly revenue by end of Q1 2023
Reach $2.5 million or $30 million in annualized revenue by end of Q4 2023 with 30% in adjusted EBIDTA
Reach $3.0 million or $36 million in annualized revenues by end of Q2 2024 with 35% in adjusted EBIDTA
Reach $50 million in annualized revenue with 35% in adjusted EBIDTA
“On the heels of Artizen Corporation’s reverse merger to acquire Pervasip Corp, the cannabis industry experienced a dramatic post pandemic contraction. Planned restructuring efforts had already launched in late 2021 and we took even more aggressive steps to further rationalize our business, dispose of undervalued assets, re-focus on higher margin products and allowed our leading brands to take a more aggressive posture to increase market share. Healthy inventory amounts provided for extraordinary financing via cashflow, albeit at extremely low margins, a carefully considered short term decision which has now come to an end as we have achieved our goals. All these efforts position us nicely for healthy financial growth in 2023. As promised, we have also finalized a 24-month roadmap and are in a position to provide carefully considered guidance in a market that is still extremely unpredictable,” said German Burtscher, Pervasip CEO. “It is also important to note that all the Artizen brands’ revenue is wholesale, revenue derived from sales to retailers. The vast majority of MSOs report revenues and resulting financials that include retail sales from stores they own in addition to usually rather small wholesale revenue, all mostly generated in protected markets. Washington State (WA) cannabis sales are taxed at 47% (!) and each dollar sold by a producer/processor is marked up 3 – 3.5 times by the retailers they sell to. Generating profitable revenue in WA will translate extremely well once our brands and operating expertise is applied in other recreational markets.”
Market Overview – Washington
The below Washington State (WA) sales by category chart provides information on how monthly sales of approximately $100 million in retail sales breaks down by product category. It might also be informative to understand that June ’22 sales over June ’19 sales (pre pandemic) show an almost 17% increase. While WA sales are slightly above other mature cannabis states (NV, CO, OR), similar increases can be seen in those markets. An exuberant pandemic triggered belief in continued rapid growth has led to over development of production infrastructure and resulted in material oversupply of bulk cannabis flower. The market is in the process of correcting and the Company estimates Q3 2023 being the end of the corrective period, resulting in strengthening prices.
$100M In Monthly Sales By Category
After several years of recreational sales, the mature markets provide relevant insights into future sales distribution across key categories with flower and pre-rolls still leading at 59%, followed by concentrates (dabs/vape) at 29% and finally edibles and beverages at a combined 9%
Artizen brands will materially expand their flower market share and enter the concentrates and edibles market with a goal of occupying top 10% market share positions in each vertical.
Strategic Outlook Summary through Q4 2024
Focus on expanding its Washington State footprint, strengthening its brand repertoire and aggressively expanding its product lineup
We expect in-state revenues generated by all brands and across all product categories to reach $30 million in annualized revenue by end of Q4 2024 with Gross Margins reaching 40% and an adjusted EBIDTA of 30%
Pervasip/Artizen Corp plans to expand its national reach by adding various recreational states to its brand footprint, either via licensing agreements or through acquisitions of recreational cultivation and retail licenses
95% of revenue from Artizen’s brands has come from sales of cannabis flower, supporting its position of the 9th most sold independent flower brand in North America; acquisitions and partnerships will open access to concentrates and edible verticals representing 40% of market sales and heretofore not covered by Artizen products
Artizen projects it will generate $50 million in annualized revenues nationally by end of Q4 2024; this is a conservative estimate that does not include any potential revenue multiples from acquisition of retail opportunities.
24 Months plan detail
Rename Pervasip Corp to Artizen Corporation by year end 2022 to better reflect the new focus of the company
Change the OTC ticker symbol
Re-brand all Pervasip/Artizen assets
Continue to rationalize the business through Q1 2023 with a focus on operating margins, shedding underperforming assets, consolidating operations and focus in-house talent on higher margin operations and product lines
Acquire concentrates assets by end of 2022, launching into the highly lucrative concentrates business
Expand flower and concentrates offerings within our brands as well as adding new brands for certain product offerings and price points through Q1 2023
Complete the audit and begin the OTC QB application process during Q2 2023
Launch Artizen Wellness Q2 2023
Enter the edibles market in Q2 2023 via acquisition and partnerships
Artizen becomes an MSO with cultivation and retail assets in 1 – 2 additional states during 2nd half of 2024, beginning its state expansion in Q1 2023, initially through brand licensing opportunities and strategic partnerships, and eventually via acquisitions and mergers during Q3 and Q4 2024
Close first brand licensing agreement by end of Q4 2022
Close one brand licensing deal every quarter thereafter
Financial Outlook Q3 2022 through Q4 2023
Reach $2.0 million in monthly revenue by end of Q1 2023
Reach $2.5 million or $30 million in annualized revenue by end of Q4 2023 with 30% in adjusted EBIDTA
Reach $3.0 million or $36 million in annualized revenues by end of Q2 2024 with 35% in adjusted EBIDTA
Reach $50 million in annualized revenue with 35% in adjusted EBIDTA
