Cannabis Industry Report - WordPress.com...increase in the S&P 500. Public companies have been trading at 2.6x 2020 Revenue and 8.1x 2020 EBITDA. Table of contents 1. Market landscape

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Industry Report

Cannabis Industry Report

The emerging recreational cannabismarket and the more mature medicalcannabis industry

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SummaryCannabis legalization is gaining momentum around the world, driven primarily by theincreasing recognition that cannabis may have a range of legitimate medicinal benefits andtherapeutic applications.

The true potential of the legal Cannabis market is unknown, but is expected to be worthbetween $125 and $150 billion.

Since July 2017, our LR Canadian Cannabis Index has risen 350% compared to an 15%increase in the S&P 500. Public companies have been trading at 2.6x 2020 Revenue and 8.1x2020 EBITDA.

Table of contents

1. Market landscape

1. Introduction

2. Global legal market size

3. Marijuana Legalization and Regulation

4. Cannabis History

2. Public firms

1. Selection of public comparable companies

2. Market Performance

3. Current multiples overview

4. Latest Transaction

3. Company profiles

Should you need further information or details, please contact:

Dario Faiella

Founding Partner at Lumos Research

[email protected]

Ortensio Foglia

Founding Partner at Lumos Research

[email protected]

Or visit

www.lumos-research.com

mailto:[email protected]

mailto:[email protected]

http://www.lumos-research.com/

145145148

163

146

161161159165166

160164171

181178182182183

0

50

100

150

200

250

Mil

lio

n

Estimated number of cannabis users, 1998-2015

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

To

ns

Global quantities of cannabis resin and herb seized, 1998-2015

Cannabis resin Cannabis Herb

Market landscapeIntroduction• Legal marijuana has started gaining traction worldwide due to

very high demand among consumers and increasinglegalization of recreational or medical marijuana in variouscountries.

• Additionally, high public and private investment for researchand the development of safer forms of ingesting marijuanasuch as tinctures, oils, vapes and other edibles are expectedto positively reinforce market growth.

• The number of conditions treated using medical marijuana isgrowing rapidly, as new patients are added to the market, thedemand for medical marijuana is expected to increasemultiple folds over the forecast period.

• As countries begin to liberalize laws related to marijuana, themarket is expected to witness a surge in demand. Currently,the majority of the cannabis is sold through illicit channels. Tocurb this illegal trade, governments have started legalizingmarijuana in order to monitor the products that enter thesupply chain and reap benefits through taxes levied on theseproducts.

• In 2003, the UNODC (United Nations Office on Drugs andCrime) estimated that the global illegal cannabis market was$113 billion, with 183 million consumers, or more than 4% ofthe population between the ages of 15 and 64.

• Cannabis plant cultivation — either through direct indicators(cultivation or eradication of cannabis plants) or indirectindicators (seizures of cannabis plants, domestic cannabisproduction being indicated as the source of seizures, etc.) —was reported (1) on the territory of 135 countries in the period2010-2015, covering 92 per cent of the world population.

• Based on quantities intercepted, the trafficking of cannabisseems to have stabilized at a high level in the past decade(compared with the level in the late 1990s). Over the period2010-2015, quantities of herbal cannabis seized were morethan four times those of cannabis resin, with some 6,000 tonsof cannabis herb and 1,300 tons of cannabis resin interceptedannually. In 2015, the largest cannabis herb seizuresworldwide were reported by Mexico, followed by the UnitedStates, Nigeria, Paraguay and Egypt; the largest cannabisresin seizures were reported by Spain, Pakistan and Morocco,followed by Afghanistan and Algeria.

• The UNODC also states that Cannabis use has remainedquite stable at the global level in recent years, despiteindications that it continues to increase in Africa and AsiaEquivalent to an estimated 183 million annual users in 2015(range: 128-238 million), roughly 3.8 per cent of the globalpopulation (2.7-4.9 per cent) used cannabis in the past year.This proportion has not changed over the past decade and isonly slightly higher than the prevalence of cannabis useestimated for 1998 (3.4 per cent). Nonetheless, as the worldpopulation has grown, so has the number of cannabis users(by 28 per cent since 1998).

1. World Drug Report 2017, UNODC (United Nations Office on Drugs and Crime)

Global number of users (2015)

183 million consumers

Global seizures (2015)

5,781tons

Herb

-2%

1,536tons

Resin

+6%

9

12

17

138

150

570

593

683

0 200 400 600 800

Cannabis (2017)

Netflix

Recorded music

Video games

Cannabis (2025)

Fast Food

Beer

Cigarettes

Annual Cananbis Sales vs Other

Industries(1)

7.5% 10.0% 12.5% 15.0% 17.5% 20.0%

Low case 59,929 79,906 99,882 119,859 139,835 159,812

Medium case 74,912 99,882 124,853 149,823 174,794 199,764

High case 89,894 119,859 149,823 179,788 209,753 239,717

7.5% 10.0% 12.5% 15.0% 17.5% 20.0%

149.1 198.8 248.5 298.2 347.9 397.6

Global Cannabis Market - Lumos Estimates

Potential Global Cannabis

Market (USDm)

Potential Global Cannabis Users (m)

Penetration rate in the selected countries

Penetration rate in the selected countriesIn USDm

Milion of users

9.2

47.3

0.5

10.5

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

2017 2027

$ B

illio

n

Cannabis Market Growth

North America NoT NA

Source: Arcview Market Researchand BDS Analytics

CAGR 19.5%

Market landscapeGlobal legal market sizeOur estimate

• The true potential of the legal Cannabis market is unknown.

• In the foreseeable future, recreational or medical cannabis is expected to be legalized in approx. 30 countries. For these countries,we estimated the number of potential users and the average monthly spending per user.

• The cannabis price significantly differs among various countries. Thus, the average monthly spending per user ranges from $5 inLesotho to $125 in the US and Canada.

• The penetration rate can go from 7.5% to 20%. Compared to other recreational substances, such as alcohol and cigarettes, this ratedoes not appear unrealistic.

• The global market of legal cannabis will be worth between $125 and $150 billion

Third Party estimates

• According to a report from Arcview Market Research and BDS Analytics, global spending on legal cannabis is expected to reach$57 billion by 2027, with adult-use sales driving the industry to the tune of $38.3 billion. Medical sales are estimated to comprise$19.1 billion. The report notes that Europe and its $1.5 trillion in healthcare spending, has the potential to be the largest medicalcannabis market on the planet. Overall, however, the European cannabis market is not expected to grow as stridently as its potentialsuggests.

• The in-depth analysis by European investment bank Bryan, Garnier & Co. projects that the “rapidly expanding industry” willpotentially grow by more than 1000% and reach $140 billion by 2027.

• The global legal cannabis industry will be worth $146.4 billion by the end of 2025, according to a recent report from Grand ViewResearch. That’s quite a jump from the $9.3 billion estimated value in 2016.

• To put the cannabis market into perspective, global sales of legal recreational and medical cannabis rivals global collective spendingon Netflix subscriptions.

• Relative to more traditional goods like cigarettes and beer, sales of cannabis on an annual basis are quite small. The marijuanaindustry, however, is on a very different growth trajectory than cigarettes and beer: legal sales of the former are expected to growexponentially while the latter markets will show a modest growth.

Source: Allied Market Research, Euromonitor International, Newzoo, FranchiseHelp, Grand View Research, Annual Report, Midia

Research, Grand View Research

9.353.3

81.4

11.7

0

20

40

60

80

100

120

140

160

2016 2025

$ B

illio

n


World North America Europe Rest of the World

Source: Grand View Research

146.6

CAGR 34.6%

13

140

0

20

40

60

80

100

120

140

160

2016 2027

$ B

illio

n


Source: Bryan, Garnier & Co.

CAGR 24.4%

Market landscapeMarijuana Legalization and Regulation (1/2)

2. Canopy Growth Corporation, Investor Presentation; Ackrell Capital,2018 Cannabis Investment Report

Map of countries with federally legal cannabis access regimes in 2014 (2)

Map of countries with federally legal cannabis access regimes in 2018 (2)

Recreational Law Medical Law State/Province Conflict with Federal Law

Global Cannabis Legalization Momentum

• Cannabis legalization is gaining momentum around the world,driven primarily by the increasing recognition that cannabismay have a range of legitimate medicinal benefits andtherapeutic applications.

• More than 20 countries today have medical laws that facilitatepatient access to cannabis or concentrates for treatingspecified medical conditions. It is also expected that - likeUruguay and numerous U.S. states - other countries willultimately enact legislation permitting the production, sale anduse of recreational cannabis (Canada will do so in late 2018).

• The world maps on the right illustrate the select countries that(i) have enacted medical laws that facilitate patient access tocannabis or concentrates for treating specified medicalconditions, (ii) have enacted recreational laws that permit thecommercial production and sale of cannabis to adults forrecreational and other uses, or (iii) have a state or provincethat has a cannabis law or policy in conflict with federal law.

United Nations Conventions

• The bedrock for the global prohibition against recreationalmarijuana is the United Nations Single Convention onNarcotic Drugs, which was signed in 1961, entered into forcein 1964, and was amended in 1972.

• It classified marijuana as a Schedule I substance, similar toheroin and cocaine. Convention adherents agreed to make itscultivation, sale and purchase for anything other than strictlyregulated medical or scientific use a punishable offense.

• The United Nations has always been in support of the use ofscheduled drugs for scientific and medicinal purposes,however they maintain that not only is cannabis an addictivedrug, but also a gateway drug. Member countries arecurrently reforming their drug policy in regards to cannabisresulting in the United Nations being forced to reassess theircurrent stance on drug reforms.

Europe

• The European Union provides no coordinated legal frameworkfor cannabis and, historically, European countries generallyhave prohibited its production and sale, but have alsodecriminalized or tolerated possession of small amounts.

• In some European countries, personal use exceptions tocriminal prosecution have been used to carve out visibledistribution models. In the Netherlands, for example,Amsterdam is famous for its coffee-shop cannabis sales, eventhough the suppliers of cannabis to those coffee shopsgenerally operate illegally. And in Spain, despite a federalprohibition on the sale of cannabis, court decisions and lawspermitting cultivation for personal consumption have served tojustify the country’s hundreds of private cannabis clubs.

• To date, no European country has implemented a recreationallaw comparable to those in Uruguay and some U.S. statesand expected in Canada. However, starting with theNetherlands in 2003, a number of European countries haveenacted medical laws that facilitate patient access tocannabis or concentrates, through importation or domesticproduction, for treating specified medical conditions.

Latin America and the Caribbean

• During the past five years, Latin American and Caribbeannations (and Puerto Rico, a U.S. territory) have takensignificant legal measures that increase access to cannabisfor medical purposes, permit recreational cannabis use andrelax criminal prohibitions.

• In 2013, Uruguay became the first nation in the world tolegalize and regulate the commercial production and sale ofcannabis to adults for recreational and other uses.

• Colombia, Argentina, Chile, Brazil, Mexico and Peru enactedregulations permitting the use of cannabis oil and otherderivatives either by qualifying patients or for scientific andmedical research

Middle East, Asia and Africa

• Throughout the Middle East, Asia and Africa, cannabiscultivation, sale and possession generally remain prohibitedand punishable as criminal offenses. Only a few countriesfrom these regions have enacted laws that decriminalizepossession of small amounts of cannabis for personal use orfacilitate patient access to cannabis or concentrates fortreating specified medical conditions.

• In 2017, particular sections of South Africa’s Drugs and DrugTrafficking Act, which prohibit cultivation, possession andpersonal use of cannabis on private property, were declaredunconstitutional.

• During the same year, Lesotho (an enclave surroundedentirely by South Africa) granted a license to a pharmaceuticalcompany to grow, process and sell cannabis for medicinal useor scientific purposes.

• In Israel, the country’s Dangerous Drug Ordinance generallycriminalizes the manufacture, possession and use ofcannabis. However, medical cannabis in smokable and otherforms has been legal since the 1990s for patients with arange of serious medical conditions.

• In India, Narcotic Drugs and Psychotropic Substances Act in1985 banned the production and sale of cannabis resin andflowers, but permitted the use of the leaves and seeds,allowing the states to regulate the latter. Cultivation ofcannabis for industrial purposes such as making industrialhemp or for horticultural use is legal in India. In 2015, the firstorganised efforts to re-legalise cannabis in India appeared.

Market landscapeMarijuana Legalization and Regulation (2/2)

2. Canopy Growth Corporation, Investor Presentation; Ackrell Capital,2018 Cannabis Investment Report

Progression of U.S. State Cannabis LawsUSA

• Marijuana and THC are Schedule I controlledsubstances under the CSA, meaning that themanufacture, distribution, dispensing andpossession of cannabis in the United States afederal crime.

• Nevertheless, 29 U.S. states and the District ofColumbia have enacted medical cannabis laws thatpermit the production and possession of cannabis orconcentrates for use in treating a broad range ofqualifying medical conditions.

• 8 states have enacted recreational laws that permitthe commercial production and sale of cannabis toadults for recreational and other uses.

• 19 U.S. states (including 2 with medical cannabislaws) have passed narrow CBD/limited laws thatpermit possession of small amounts of low-THC/high-CBD cannabis concentrates for use intreating a few serious medical conditions.

Canada

• The Marihuana Medical Access Regulations(MMAR), issued in 2001, regulated the access tomedical cannabis, but was eventually replaced in2016 by the Access to Cannabis for MedicalPurposes Regulations (ACMPR), which permitsbusinesses licensed by Health Canada tocommercially produce and distribute cannabisflower, cannabis oil and cannabis starter materials,such as plants and seeds, to individuals with amedical recommendation from an authorized healthcare practitioner.

• The legislation to legalize cannabis for recreationaluse (Cannabis Act, Bill C-45) was passed by theHouse of Commons of Canada in late November2017; it passed second reading in the Senate ofCanada on 22 March 2018.

• On 18 June 2018, the House passed the bill withmost, but not all, of the Senate's amendments. TheSenate accepted this version of the Act thefollowing day. Prime Minister Justin Trudeauannounced the next day that recreational use ofcannabis would no longer violate the Criminal Codeas of 17 October 2018.

Canadian Legal Minimum Age

Canadian Retail Storefront Model

Canadian Legislation Status

Market landscapeCannabis History

Source: http://cannabishistory.tni.org/

Spread of Medical Use in Europe and the USA

8000 BCE

3000 BCE

12000 BCE

1550 BCE

500 BCE

2700 BCE

1500

1839

70

Early Cannabis Use in Eurasia:

Different groups of people across the Eurasian landmass

independently began using cannabis around 8000 BCE

The Spread of Cannabis Around the World:

Cannabis Plants evolved around 12,000BC on the steppes of

Central Asia.

Intensification of Cannabis Use at the Dawn of Bronze

AgeEarly Medical Use of

Cannabis:Cannabis was supposedly first

described in a medical context by the mythical Chinese emperor

Shen Nung

Medical Cannabis in Ancient Egypt:

The Ebers Papyrus has a prescription for Cannabis Sativa

applied topically for inflammation

First Documentation of Cannabis Use as

Psychoactive Substance:Rhe Gushi culture cultivated

cannabis for pharmaceutical, psychoactive or divinatory

purposes Medical Cannabis Use in Ancient Greece:

The Greek physician Dioscoridesrecords cannabis in his

pharmacopoeia

Cannabis in Africa

Market landscapeCannabis Recent History

Source: http://cannabishistory.tni.org/

Canada Announces To Legalize Cannabis

July 1, 2001

March 22, 2002

July 20, 1996

January 1, 2014

November 4, 2014

2006

November 8, 2010

April, 13 2017

October 20, 2015

Cannabis Legalization Advances in the USA

Canada on the Path to Cannabis Regulation

Three More States in the USA Approve Cannabis

Regulation

Colorado Implements Cannabis Regulation

World Drug Report on Cannabis

In discussing potential health and addiction problems the 2006

Report admits that much of the scientific data is still inconclusive

and its evidence demostrates that supply reduction is

impossible

Cannabis Social Clubs in Spain

Portugal Decriminalises All Drugs Including Cannabis

Medical Marijuana Movement:

In 1996 voters in California passed Proposition 215, the

Compassionate Use Act, exempting medical use of

cannabis from criminal penalties making a new wave of soft

defections.

Public firmsSelection of public comparable companies (1/3)

Company name Type Country Business Description

Cannabis Sativa, Inc. Pure USA

Cannabis Sativa Inc along with its subsidiaries engages in the development and licensing of natural cannabis products. Its product

offering includes cannabis formulas, edibles, topicals, strains, recipes and delivery systems under the Go Deep, Go Deep EXTRA

(GDX), Face Garden, Body Garden and Lip Garden line of products. It holds the license for a medicinal cannabis strain called NZT, a

cannabis lozenge delivery methodology, and a cannabis trauma cream formula.

CannaRoyalty Corp Pure USA

CannaRoyalty Corp is an integrated investor and operator in the legal cannabis sector in the United States, Canada, and Puerto Rico.

The company’s focus is on building and supporting a diversified portfolio of cannabis consumer products. It investments settle in

research and intellectual property development segment, in development and industry infrastructure built.

CV Sciences Inc. Pure USA

CV Sciences Inc operates in two distinct segments: a drug development division focused on developing and commercializing novel

therapeutics utilizing synthetic cannabidiol and a consumer product division manufacturing, marketing and selling plant based CBD

products to a range of market sectors.

Friday Night Inc. Pure USA

Friday Night Inc is the Canada-based firm. The company is primarily engaged in growing, production, and distribution of medical and

recreational marijuana in the United States. In addition, the company is also involved in the commercialization of automated triage

diagnostic imaging tool for the triage of stroke patients. The company possesses market recognition under the brand name “Vegas J’s”;

Spectrum; Krypted; and Vader. Most of its revenue comes from the United States market while it also has a presence in the Canadian

market.

Golden Leaf Holdings Ltd Pure USA

Golden Leaf Holdings Ltd is in the business of producing and distributing cannabis oil and flower products within adult-use regulated

market. The brand line of the company consists of golden, proper, left coast connection, and chalice farms. The company also gets

royalties for the product it produces. It also focuses on owning a fully-licensed dispensary from which it sells cannabis products. Sales

of cannabis products generate maximum revenue for the company.

GW Pharmaceuticals Plc Pure USA

GW Pharmaceuticals PLC is a UK based company, engaged in the research, development, and commercialization of cannabinoid

prescription medicines using botanical extracts derived from the Cannabis Sativa plant. Its business activities are functioned through

three reportable segments which are Commercial, Sativex Research and Development and Pipeline Research and Development. The

company’s lead product candidate is Epidiolex, which is a liquid formulation of pure plant-derived cannabidiol used for the treatment of a

number of rare childhood-onset epilepsy disorders. The company also develops and markets Sativex, an oromucosal spray for the

treatment of spasticity due to multiple sclerosis. Geographically its presence can be seen across the region of UK, Europe, US,

Canada, and others.

iAnthus Capital Holdings Inc Pure USA

iAnthus Capital Holdings Inc owns and operates licensed cannabis cultivators, processors and dispensaries throughout the United

States. The company’s operating segments include Massachusetts, Vermont, Colorado, New Mexico, and Corporate. It generates a

majority of its revenue from Massachusetts.

MariMed Inc Pure USA

MariMed Inc provides consulting services for the design, development, operation, funding, and optimization of medical cannabis

cultivation, production, and dispensary facilities. It also develops and manages facilities for the cultivation, production, and dispensing

of legal cannabis and cannabis-infused products under the Kalm Fusion brand name. In addition, the company offers legal, accounting,

human resources, and other corporate and administrative services.

MedMen Enterprises Pure USA

MedMen Enterprises Inc is the preeminent cannabis company with multiple assets and operations in California, Nevada and New York,

which combined account for nearly half of North America's addressable legal market. The company owns and operates licensed

cannabis facilities in cultivation, manufacturing and retail.

MPX Bioceutical Corporation Pure USA

MPX Bioceutical Corp is a Canada based company involved in the natural health products industry. It is engaged in the manufacture

and distribution of nutraceuticals to the North American marketplace and providing financial and business expertise to emerging

corporations primarily in the pharmaceutical, medical and biotechnology industries. The company provides management, staffing,

procurement, advisory, financial, real estate rental, logistics and administrative services to two medicinal cannabis enterprises in

Arizona operating two licensed dispensaries. The company's significant operations are in Canada.

Terra Tech Corp Pure USA

Terra Tech Corp is an American cannabis-focused agriculture company. Its business is organized into two segments Hydroponic

product and Cannabis Products. It principally engages in cultivating and providing medical cannabis, along with other agricultural

products such as herbs and leafy greens through hydroponic farming technology. The company along with its subsidiary involves in the

retails of its farm produce, cannabis flowers, cigarettes, hydroponic equipment such as ballasts, bulbs, and reflectors.

United Cannabis Corp Pure USA

United Cannabis Corp provides consulting services, proprietary products and licenses its intellectual property to businesses in the

cannabis industry. It owns intellectual property relating to the legalized growth, production, manufacture, marketing, management,

utilization and distribution of medical and recreational marijuana and marijuana-infused products. In addition, the group also focuses on

advancing the use of phytocannabinoid therapeutics in medicine through research, product development, and education. The company

offer products such as Prana Bio Nutrient Medicinal and Prana Aromatherapy Transdermal Roll-on line. Geographically, all the

operations are functioned through the region of United States.

American Cannabis Co Ancilliary USA

American Cannabis Co Inc is engaged in the business of providing advisory and consulting services specific to this industry, design

industry-specific products and facilities. The company provides services like design and buildout, equipment fulfillment, branding and

marketing, operational management, regulatory compliance. In addition, it also offers end-to-end solutions to existing and aspiring

participants in the cannabis industry. Geographically, the company operates in the countries like The United States and Canada,

however, it derives most of the revenue from The United States.



General Cannabis Corp Ancilliary USA

General Cannabis Corp provides services and products to the cannabis industry. The company operates in four segments namely,

Security and Cash Transportation Services providing security services including on-site professionals, video surveillance and cash

transport; Marketing Consulting and Apparel providing design, branding and marketing strategy consulting services; Operations

Consulting and Products providing consulting services such as obtaining licenses, compliance, cultivation, retail operations, logistical

support, among others and Real Estate engaged in acquisition and leasing of cultivation space and related facilities to licensed

marijuana growers and dispensary owners. The majority of its revenue is received by providing security and cash transportation

services.

GrowGeneration Corp Ancilliary USA

GrowGeneration Corp owns and operates specialty retail hydroponic and organic gardening stores. GrowGen carries and sells

thousands of products, including organic nutrients and soils, advanced lighting technology and state of the art hydroponic equipment to

be used indoors and outdoors by commercial and home growers. The company also maintains their own website. The stores are

located in Colorado, California, Nevada, and Washington.

Innovative Industrial Properties

Inc. Ancilliary USA

Innovative Industrial Properties Inc was incorporated in Maryland on June 15, 2016. The Company is engaged in the acquisition,

ownership and management of specialized industrial properties leased to state-licensed operators for their regulated medical-use

cannabis facilities. It conducts its business through a traditional umbrella partnership real estate investment trust, or UPREIT structure,

in which properties are owned by Operating Partnership, directly or through subsidiaries. The company faces competition from a diverse

mix of market participants, including but not limited to, other companies with similar business models, independent investors, hedge

funds and other real estate investors, hard money lenders, and cannabis operators.

Solis Tek Inc Ancilliary USA

Solis Tek Inc researches, designs, develops and manufactures advanced, energy efficient indoor horticulture lighting and ancillary

equipment. Its products portfolio includes digital ballasts, digital lamps, reflectors, lighting accessories, and official SolisTek apparel. The

company’s products are used for, the hydroponic and indoor growing of other horticultural products, such as hothouse vegetables,

decorative plant nurseries, indoor aquariums, and industrial painting facilities and sold to retail stores, distributors and commercial

growers.

Surna Inc Ancilliary USA

Surna Inc develops, designs, and distributes cultivation technologies for controlled environment agriculture. Its technologies include a

comprehensive line of optimized lighting, environmental control, air sanitation and cultivation facilities which are designed to meet the

specific environmental conditions required for indoor cultivation and to dramatically reduce energy and water consumption. The

company provides services in the areas of consulting, engineering, biosecurity, odor control, installation support.

Auxly Cannabis Group Inc. Ancilliary CanadaAuxly Cannabis Group Inc, formerly Cannabis Wheaton Income Corp is an investment and merchant company. It seeks to provide

investor returns through streams and capital appreciation in the cannabis industry of Canada.

CannTrust Holdings Inc. Pure CanadaCannTrust Holdings Inc is engaged in the business of producing and distributing medical cannabis in Canada. Its facility is located at

Vaughan, Ontario in Canada.

Sunniva Inc - Ordinary Shares Pure Canada

Sunniva Inc is vertically integrated medical cannabis company committed to delivering safe, low-cost, high-quality products and services

at scale. The company is focused on the cultivation, production and distribution of therapeutic solutions targeting two of the medical

cannabis markets in the world: Canada and California.

OrganiGram Holdings Inc Pure Canada

OrganiGram Holdings Inc is a Canada based company, through its subsidiary, is engaged in producing medical marijuana. It is also

focused on providing a multi-disciplinary approach to post-traumatic stress disorder treatment, chronic pain, trauma therapy, and

medical cannabis as an alternative medicine, through its subsidiary. The group carries its business operations in Canada. It offers

products based on sativa, indica, hybrid, and cannabidiol.

Namaste Technologies Inc. Pure Canada

Namaste Technologies Inc is a global leader in medical cannabis delivery systems, with operations in over 20 countries. Company has

developed technology platforms including NamasteMD.com, Canada's first ACMPR compliant telemedicine application. The company's

subsidiary, Cannmart Inc. is a late-stage ACMPR applicant for a medical cannabis "sales-only" license, whereby the company will offer

a large variety of medical cannabis sourced from domestic and international producers.

MYM Nutraceuticals Inc Pure Canada

MYM Nutraceuticals Inc is a Canada based company engaged in the business of acquiring and developing natural remedies. It is

focused on medical marijuana business by producing cannabis growing facilities and products. The Cannabidiol brands of the company

are HempMed, Joshua Tree, and Dr. Furbaby. The products under the brands of the company include concentrates, oils, tinctures, nasal

sprays, cosmetics, capsules, topicals, edibles, and E-juices.

MedReleaf Corp. Pure CanadaMedReleaf Corp is engaged in the production and sale of cannabis for medical purposes as regulated by the ACMPR, pursuant to its

Licences and, in particular, its Markham Commercial Licence.

Isodiol International Inc. Pure Canada

Isodiol International Inc is a market leader in pharmaceutical grade pure, natural cannabidiol (CBD) and in manufacturing and

development of CBD consumer products. The company's growth strategy includes development of over-the-counter and pharmaceutical

drugs and continued international expansion into Latin America, Asia and Europe.



Emerald Health Therapeutics

Inc. Pure Canada

Emerald Health Therapeutics Inc is a Canada based Health Canada Licensed Producer of medical cannabis. Through its subsidiary, it is

engaged in the production and sale of medical marihuana; and also has interest in a company that produces, cultivates and distributes

wholesale cannabis and cannabis extracts for therapeutic and non-therapeutic use purposes. Its offers emerald health botanicals

product in a pill or capsule format.

Cronos Group Inc. Pure Canada

Cronos Group Inc is a diversified and vertically integrated cannabis company. Its principal activities involve production and sale of

cannabis in federally legal jurisdictions, including Canada and Germany. It sells dried cannabis and cannabis oils under its medical

cannabis brand Peace Naturals. The firm seeks to invest in companies either licensed or actively seeking a license, to produce medical

marijuana pursuant to Canada’s Marihuana for Medical Purposes Regulations.

Canopy Growth Corporation Pure Canada

Canopy Growth Corp through its subsidiaries is the licensed producer of medical marijuana in Canada. The company grows, produces

and sells medical marijuana. It operates diverse brands and variety supported by over half million square feet of indoor and greenhouse

marijuana production. It sells medical marijuana under various brand names including Tweed, Bedrocan, and Mettrum. A majority of the

revenue is derived from the sale of medical marijuana by Tweed and Bedrocan in Canada.

Aphria Inc. Pure Canada

Aphria Inc and its subsidiaries produce and sell medical marijuana. Its products include Capsules, Oral solutions, and Vaporizers. The

company's operations are based in Leamington, Ontario. It is focused on producing and selling medical marijuana and its derivatives

through retail sales and wholesale channels.

Aurora Cannabis Inc. Pure Canada

Aurora Cannabis Inc is medical cannabis company having domestic and international footprint and is vertically integrated and

horizontally diversified across every key segment of the value chain, from facility engineering and design to cannabis breeding and

genetics research, cannabis and hemp production, derivatives, high value add product development, home cultivation, wholesale and

retail distribution.

Public firmsMarket performance and multiples overview

LR Cannabis indexes

Our LR Cannabis indexes are market-cap weightedand were rebased to 100 points as of July 2017.

The Canadian index reached its one-year high inJanuary 2018 at 405 points and its low in August2017 at 93.5. As of September, 4th 2018, itsignificantly overperformed the S&P500 (+257% vs+15%).

The US index reached its one-year high in June2018 at 200 points and its low in August 2017 at89.6. As of September, 4th 2018, it significantlyoverperformed the S&P500 (+87% vs +15%).

Market multiples

Over the last year, public Cannabis companies havebeen trading on average at 6.3x 2019 Revenue, at2.6x 2020 Revenue and at 3.0x 2021 Revenue. Thelatter multiple tough features a smaller sample setdue to the lack of reliable forecasts.

They have been trading at 47.0x 2019 EBITDA, at8.1x 2020 EBITDA, and at 10.1x 2021 EBITDA.

The average 2019 EBIT multiple was 82.3x, 10.5 for2020 and 11.3 for 2021.

Finally, they have been trading at 66.9x 2019Earnings and at 19.2x 2020 Earnings.

Overall, Cannabis companies features very high2019 valuations, but will reach reasonable values in2020 and 2021, due to the legalization taking placein Canada from the end of 2018.

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

EV/Revenue

EV/Revenue 2019 EV/Revenue 2020 EV/Revenue 2021

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

450.0

LR Cannabis Indexes

US index CAD index S&P 500

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Public firmsLatest Transactions(1/3)

Close

DateTarget Acquirer Transaction Description

Transaction

Value

Enterprise

Value

EV/Revenue

2017

EV/Revenue

2018

EV/Revenue

2019

24-Jul-18 iRollie MariMed Inc

MariMed Acquired iRollie to Support MariMed Brands, Expand into Ancillary Cannabis

Service Offerings including its intellectual property (IP), clients, and its host of products and

services. MariMed acquired iRollie and its executives in exchange for $600,000 in

MariMed stock. The acquisition enables MariMed to round out its ownership portfolio with

an ancillary business capable of servicing all existing brands and drive new business,

partnerships, and revenue.

NA NA NA NA NA

10-Jul-18 Hiku BrandsCanopy

Growth

Canopy Growth acquired Hiku Brands to Strengthen Retail and Brand Portfolio. Hiku is

focused on building a portfolio of iconic, engaging cannabis brands, immersive retail

experiences and handcrafted cannabis production. Under the terms of the agreement, Hiku

shareholders will receive 0.046 of a Canopy Growth common share in exchange for each

common share of Hiku.

NA NA NA NA NA

05-Jul-18 BC TweedCanopy

Growth

Canopy Growth acquired the remaining 33% stake of BC Tweed Joint Venture Inc. In

connection with the Transaction, Canopy Growth has paid $1 million in cash as a non-

refundable deposit against the purchase price and has issued $374 million worth of shares

in the Company to the minority shareholders of BC Tweed.

$374M 1133.3 NA NA NA

03-Jul-18 FloraCalCannaRoyalty

Corp

CannaRoyalty Closes Acquisition of FloraCal, a licensed premium craft cannabis producer

located in Sonoma County, California. the Company has acquired 100% of FloraCal for a

total consideration of US$1 million in cash, subject to a working capital adjustment ,and

35,088 CannaRoyalty Class A Compressed Shares(2) ("Compressed Shares"), as well as

up to an additional US$3 million in cash and 35,088 Compressed Shares to be paid over 3

years, based on the completion of certain milestones, and other considerations.

$4M 4.0 0.63x NA NA

12-Jun-18 Anadia LabsAurora

Cannabis

Aurora Cannabis acquired Anadia Labs. Anandia Labs is licensed by Health Canada and

is focused on cannabis based biochemistry and genomics. Aurora Cannabis be gain a

knowledge base and the ability to develop patentable genetics and strains for their product

line whereas, Ananida Labs is being awarded with a partner with what seems to be

unlimited resources to expand the company’s operations.

$115M 115.0 32.86x NA NA

07-Jun-18

Florida Pot

Nursery and

Dispensary

Rights

MedMen

Enterprises

Inc

MedMen acquired Florida Pot Nursery and Dispensary Rights. The $53 million deal

included the nursery’s 5-acre cultivation facility in Eustis, Fla., and the right to open 25

medical marijuana dispensaries in the state.

$53M 53.0 NA NA NA

14-May-18 MedReleafAurora

Cannabis

Aurora Cannabis acquired MedReleaf. Under the terms of the Arrangement Agreement,

holders of MedReleaf common shares will receive 3.575 common shares of Aurora for

each MedReleaf common share held (the "Exchange Ratio"). Upon completion of the

Transaction, existing Aurora and MedReleaf shareholders would own approximately 61%

and 39% of the pro forma company, respectively, on a fully diluted basis.

$3.2B 5245.9 131.15x 119.23x NA

13-May-18 CanniMedAurora

Cannabis

Aurora Cannabis acquired CanniMed, a Canadian-based, international plant

biopharmaceutical company and a leader in the Canadian medical cannabis. The

approximately 1.2 million CanniMed Shares were acquired for a consideration of

approximately 3.4 million Aurora shares and $1.7 million in cash.

$1B 1149.4 68.83x NA NA

02-May-18

Farmtiva &

Commence

Hemp

Farmin

Isodiol

International

Isodiol International acquire 51% of Farmtiva & Commence Hemp Farming In California.

The exclusive partnership with the Imperial Valley Conservation Research Center and

Farmtiva will harvest the first legally grown hemp in California in 24 years under the

Agricultural Act of 2014 § 7606 (“2014 Farm Bill”). Under the terms of this agreement,

Isodiol will issue Farmtiva $1,050,000 USD

NA NA NA NA NA

02-May-18 Findify

Namaste

Technologies

Inc.

Namaste Acquired Findify, a Leading A.I. and Machine Learning Company, to Increase

Conversion Rates, Average Order Value, Retention and Referrals. Namaste acquired all

issued and outstanding shares of Findify in exchange for: US $2,000,000 in cash to be

paid upon the closing date of the transaction. US $10,000,000 to be paid in common

shares of Namaste at a mutually agreed price of C$1.80 per common share.

$12M 12.0 4.80x NA NA

17-Apr-18 Canveda

MPX

Bioceutical

Corporation

MPX has acquired all the Canveda Shares for a total purchase price of CDN$18,120,000

comprised of the following consideration: CDN$3,120,000 in cash; CDN$15,000,000

satisfied through the issuance of 21,428,571 common shares in the capital of MPX issued

at a price of CDN$0.70 per MPX Share; the issuance of 6,000,000 common share

purchase warrants each exercisable into one (1) MPX Share at an exercise price of

CDN$0.84 for a period of five (5) years from the date of issuance.

$13.9M 13.9 NA NA NA

27-Mar-18

William

Noyes

Webster

Foundation

Liberty Health

Sciences

Liberty Health Sciences acquired William Noyes Webster Foundation. The Organization

provides pharmaceutical products. William Noyes Webster Foundation offers products and

resources by using clinical applications of medical marijuana. William Noyes Webster

Foundation serves communities in the State of Massachusetts.

$16M 21.3 1.25x NA NA

19-Mar-18 Bottle It IncCannabis

Science

Cannabis Science Acquires Bottle It Inc located in Corona, California, State-of-the-Art

27,000 Sq. Ft., Bottling Manufacturing Facility for Various Bottled Waters, Energy Drinks,

Vitamin Shots, Tincture Bottles, Sprays, and Various Sized Food Containers

NA NA NA NA NA


Close


Transaction

Value

Enterprise

Value

EV/Revenue

2017

EV/Revenue

2018

EV/Revenue

2019

02-Mar-18Spire Secure

Logistics

Friday Night

Inc.

Friday Night Inc. Closes Acquisition of Spire Secure Logistics and Strengthens Team.

Spire is a security and intelligence company with expertise in law enforcement training, high-

risk mining security, and the cannabis sector.NA NA NA NA NA

22-Feb-18Bhang

Edibles

CannaRoyalty

Corp

CannaRoyalty acquired Bhang Edibles. The Agreement also includes a right of first refusal

(the "ROFR") to license other future Bhang® products within the edibles and concentrates

categories in California.

NA NA NA NA NA

31-Jan-18 Nuuvera Aphria Inc

Aphria Inc acquired Nuuvera, a global cannabis company based in Brampton, Ontario, for

about C$826 million ($670 million) in cash and stock. The deal is part of a growing wave of

consolidation in Canada’s marijuana industry as companies seek to gain market share

before sales become legal at some point this year. While the combined Canadian market

for medical and recreational market is expected to reach about C$8 billion in sales by

2021, companies such as Aphria and Nuuvera are looking to grow in markets where

there’s even bigger potential.

$425M 425.0 NA NA NA

17-Jan-18GrowHealthy

Holdings

iAnthus

Capital

Holdings Inc

iAnthus Capital Acquired Medical Cannabis Business of GrowHealthy Holdings, Marking

Full-Scale Entry into Fast Growing Florida Market.NA NA NA NA NA

15-Jan-18

Broken

Coast

Cannabis

Aphria Inc

Aphria Inc avquired Broken Coast Cannabis, a cannabis producer on Vancouver Island, in

a transaction it valued at $230 million in cash and stock. Under the agreement, Aphria will

pay up to $10 million in cash with the remainder in shares based on a deemed price of

$15.09 per share.

$230M 230.3 NA NA NA

05-Jan-18Budly

Software

MYM

Nutraceutical

s Inc

MYM Acquired Budly, a leading software company based in California that has developed

a smartphone-enabled sales and distribution system connecting medicinal cannabis

patients with local dispensary drivers for fast delivery and monitoring of orders.

NA NA NA NA NA

08-Dec-17Be Tru

Organics

Isodiol

Intenational

Isodiol Intenational acquired Be Tru Organics, a cause driven organization specializing in

holistic products for everyday health and balance in the human body with the goal to

promote well-being within the mind, body, & soul. There have been no changes to the terms

of this agreement. Isodiol will issue Be Trū Organics $2,000,000 USD in stock, subject to a

36-month escrow.

NA NA NA NA NA

08-Dec-17C3 Global

Bioscence

Isodiol

Intenational

Isodiol Intenational acquired C3 Global Bioscence, a cause-driven organization committed

to developing sustainable health solutions through the advancement of cannabis science.

As part of this agreement, Isodiol will issue C3GBS up to $1,000,000 USD in stock subject

to a 36-month escrow as part of this agreement.

NA NA NA NA NA

23-Nov-17 Larssen LtdAurora

Cannabis

Aurora Cannabis acquired a Leading Global Greenhouse Design Firm Larssen Ltd. The

terms of the transaction are undisclosed, but include performance-based milestone

payments, such as those related to profitability metrics, as well as certain Aurora

standards.

NA NA NA NA NA

30-Oct-17Canopy

Growth

Constellation

Brands

Constellation Brands paid about C$245 million ($191.06 million) for a 9.9% stake in Caopy

Growth. Constellation has no plans to sell canabis producs in the US or any other market

unless it's legally permitted.

$191.06M 19.3 0.63x 0.32x 0.06x

22-Aug-17 NanoLeaf

Technologies

Maricann

Group Inc.

Maricann Group Inc acquired 100% of the issued and outstanding shares of NanoLeaf

Technologies Inc. ("NanoLeaf"), a biotech company possessing licensing rights to a

number of globally patented technologies that provide proven pharmaceutical, nutraceutical,

cosmetic and functional beverage drug delivery formulations.

$31M 31.0 NA NA NA

21-Aug-17

Mile High

Protection

Services

LLC

General

Cannabis

Corp

General Cannabisacquired Mile High Protection Services LLC. Mile High has a diversified

client roster, providing security services to hospitality companies, such as hotels, and to

licensed cannabis retailers and cultivators in Colorado.

NA NA NA NA NA

02-Aug-17 PrestoDoctorCannabis

Sativa, Inc.

Cannabis Sativa Acquires 51% of PrestoDoctor, A Premier Medical Marijuana

Telemedicine Platform. This convenience eliminates the need for patients to travel to an in-

person appointment or wait in line at a clinic. More than 40,000 users have registered to

consult with PrestoDoctor’s 15+ licensed physicians across the United States.

PrestoDoctor currently offers services in California and Nevada, and is actively targeting

expansion into multiple additional states in the coming months.

NA NA NA NA NA


Close


Transaction

Value

Enterprise

Value

EV/Revenue

2017

EV/Revenue

2018

EV/Revenue

2019

10-Jul-17Chalice

FarmsGolden Leaf

Golden Leaf acquired Chalice Farms, a vertically integrated company that operates four

medical and adult-use retail outlets. Golden Leaf, which produces and distributes marijuana

flower and oil goods through its subsidiaries, payed $19.3 million in cash and 83.4 million

shares of its common stock to acquire Chalice Farms.

$103M 103.0 NA NA NA

30-May-17 PedaniosAurora

Cannabis

Aurora Cannabis acquired German Medical Cannabis Market Leader Pedanios GmbH.

Under the terms of the purchase agreement Aurora payed a consideration to holders of

Class B securities of Pedanios approximately 3,421,756 common shares of Aurora, priced

at $2.14 per share. In addition, a total consideration of approximately $13,565,000 in cash

and common shares is payable to the holders of Class A common shares of Pedanios,

which are held by the two founders/Managing Directors of Pedanios who will continue to run

the company.

NA NA NA NA NA

06-Mar-17

Peloton

Pharmaceuti

cal

Aurora

Cannabis

Aurora Cannabis acquired Peloton Pharmaceutical, a Montreal-area late-stage ACMPR-

applicant. Under the terms of the Proposal, the Company provided a total investment pool

of $7,000,000 of cash and common shares of Aurora for distribution to creditors.

$7M 7.0 NA NA NA

24-Feb-17Australian

Vaporizers

Namaste

Technologies

Inc.

Namaste acquired Australian Vaporizers. The acquisition of Australian Vaporizers adds

significant revenue and solidifies Namaste's position as the largest online retailer of

vaporizers in the world. Post consolidation, Namaste will control approximately 90% of the

vaporizer online retail market in Australia.

$10M 10.0 2.22x NA NA

01-Dec-16 Mettrum IncCanopy

Growth

Canopy Growth acquired a Toronto-based Mettrum Health Corp. for $430 million, forming a

Canadian marijuana mega-company with a patient base that would dominate the Canadian

market.

$430M 553.4 33.14x NA NA

28-Nov-16 MedCannCanopy

Growth

Canopy Growth Establishes Germany Based Operations Through the Acquisition of

Licensed Distributor, MedCann GmbHNA NA NA NA NA

31-Mar-16Blüm

Oakland

Terra Tech

Corp

Terra Tech Corp. Closes Acquisition of Blüm Oakland, a Retail Medical Cannabis

Dispensary. he acquisition includes Blüm's fully integrated supply chain, which consists of a

sophisticated onsite cultivation facility and its portfolio of proprietary strains, as well as its

high-volume retail storefront.

NA NA NA NA NA

01-Dec-15 CannX Inc CV Sciences CV Sciences acquired CanX Inc., a pre-clinical drug development company focused on

significant unmet medical needsNA NA NA NA NA

20-Oct-15

The

Hydropothec

ary

Corporation

Canadian

Cannabis

Corp

Canadian Cannabis Corp. acquired Hydropothecary, a licensed producer of cannabis and

cannabis oils and licensed distributor of Medicinal Marijuana under the Marijuana for

Medical Purposes Regulation. The parties have agreed to general terms, where CCC

payed a total consideration of $21.3 million in cash and stock ($28 million CAD) for 100%

ownership in Hydropothecary.

$21.3M 21.3 5.20x NA NA

12-Aug-14

Hydro

Innovations

LLC

Surna Inc

Surna Inc. a company that develops, acquires, produces and sells equipment for the legal

marijuana industry with a focus on disruptive technologyvacquired Hydro Innovations

("Hydro"). Hydro's revenue and other financials will be integrated into Surna's annual

results.

NA NA NA NA NA

24-Apr-13 Gro-RiteTerra Tech

Corp

Terra Tech Corp., acquired Gro-Rite, a New Jersey Based Garden Superstore with Annual

Revenues of Over $4 Million. The terms of the LOI are full integration of GroRite’s business

into Terra Tech, a publicly traded company. Key executives from GroRite will become

officers as well as join the Board of Directors for Terra Tech.

NA NA NA NA NA

14-Jan-13

Naturally

Beautiful

Plant

Products

Terra Tech

Corp

Terra Tech Corp., acquired Naturally Beautiful Plant Products. a company based in

Belvidere, New Jersey, specializes in growing a line of spring and summer annuals.NA NA NA NA NA

Mean 28.1x 59.8x 0.1x

Median 5.0x 59.8x 0.1x

Min 0.6x 0.3x 0.1x

Max 131.1x 119.2x 0.1x

Company ProfilesCanopy Growth

Key People

SnapshotCompany Overview

• Canopy Growth Corporation (“Canopy Growth”) is a publicly traded corporation, incorporated in

Canada, with its head office located in Ontario, with its common shares listed on the TSX,

under the trading symbol “WEED”

• The principal activities of the Company are the growing, possession and sale of medical

cannabis as regulated by the Access to Cannabis for Medical Purposes Regulations (“ACMPR”)

• The Company is also expanding to jurisdictions outside of Canada where federally lawful and

regulated including subsidiaries which will operate in Europe, Latin America and the Caribbean

• Through its wholly-owned subsidiaries, Canopy Growth operates numerous state-of-the-art

production facilities with over 600,000 sq. ft. of licensed indoor and greenhouse production

capacity

• The Company has eight licenses to cultivate and sell cannabis under the ACMPR program

• Capacity expansion totalling over 5.0 million sq. ft. of production space has been announced to

date

Financial Overview

Headquarter Ontario, Canada

Operating

countries

Europe, Latin

America, Caribbean

Foundation 2014

Expertise Medical Cannabis

Websitewww.canopygrowth.co

m

• Constellation Brands

• Spektrum Cannabis

• Spektrum Chile

• Spektrum Denmark

• Tweed JA

• AusCann

• Alcaliber

• Bedrocan Brasil and Entourage

Phytolab

• Victoria Agriculture

Partners

Brands Overview

M&A History

• August 15, 2018: Constellation brands

announced an additional $4 billion stake in

Canopy Growth, increasing its stake to 38%.

Constellation also received an opportunity over

the next three years to buy up to $5 billion in

additional funding, or up to 50%.

• July 10, 2018: Canopy Growth acquired Hiku

Brands to Strengthen Retail and Brand Portfolio

• July 5, 2018: Canopy Growth acquired BC

Tweed for $374M

• October30, 2017: Constellation Brands paid

about C$245 million ($191.06 million) for a 9.9%

stake in Canopy Growth.

• December 1, 2016: Canopy Growth acquired

Mettrum Inc

• November 28, 2016: Canopy Growth acquired

MedCann

Income Statements

in CADm FY-15 FY-16 FY-17 FY-18

Revenue 2 13 40 78

Gross profit 3 6 (22) 40

Operating income (8) (14) (8) (79)

Income before taxes (8) (8) (79) (53)

Net income (9) (3) (17) (70)

EPS Basic (0.3) (0.1) (0.1) (0.4)

EPS Diluted (0.3) (0.1) (0.1) (0.4)

Balance Sheet


Cash and cash equivalents 21 15 102 323

Total current assets 29 45 178 482

Total non-current assets 18 99 500 955

Total assets 48 143 678 1,437

Total current liabilities 5 7 18 92

Total non-current liabilities 2 12 45 186

Total liabilities 6 20 63 278

Total stockholders' equity 41 124 615 1,159

Cash flow Statement


Net cash provided by

operating activities 11 (12) (19) (82)

Net cash used for investing

activities (15) (12) (19) (224)


financing activities 45 19 132 526

Net change in cash 21 (6) 86 221

Free cash flow (4) (23) (57) (260)

Other Stats

FY-15 FY-16 FY-17 FY-18

N. of employees NA 202 701 1,033

Q1-18 Q2-18 Q3-18 Q4-18

Patients at quarter's end 59,163 63,513 68,919 74,000

Kilogram equivalent sold 1,839 2,020 2,330 2,528

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Share Price and Volume

Volume Adj Close

Company ProfilesCanopy Growth

Share Price Performance and Market multiples overview

Share

price

(CAD)

Volume

(m)

EV/Reven

ue 2019E

(RE)

EV/Reven

ue 2020E

(RE)

EV/Reven

ue 2019E

(LE)

EV/Reven

ue 2020E

(LE)

EV/Reven

ue 2021E

(LE)

Min 8.5 0.3 4.4x 2.7x 4.0x 1.4x 0.9x

Max 47.8 19.4 28.1x 15.2x 27.8x 9.5x 6.2x

Latest 31.9 6.5 18.3x 6.2x 18.3x 6.2x 4.1x

Average 24.9 5.1 14.6x 6.7x 13.8x 4.7x 3.1x

Median 27.6 4.2 16.3x 6.7x 15.7x 5.4x 3.5x

`

EV/EBITDA

2020E (LE)

EV/EBITDA

2021E (LE)

EV/EBIT

2021E (LE)

PE 2020E

(LE)

PE 2021E

(LE)

PE 2019E

(RE)

PE 2020E

(RE)

Min 6.1x 3.1x 4.2x 19.0x 11.1x 0.0x 13.4x

Max 42.3x 21.5x 29.3x 127.5x 74.3x 569.7x 104.5x

Latest 27.8x 14.1x 19.3x 85.0x 49.5x 0.0x 83.8x

Average 21.0x 10.7x 14.5x 63.8x 37.2x 215.2x 45.8x

Median 23.9x 12.2x 16.6x 73.2x 42.6x 165.6x 46.2x

Company ProfilesAurora Cannabis


• Aurora Cannabis Inc. is a world-renowned integrated cannabis company.

• Through their wholly owned subsidiaries, strategic investments, and global partnerships, Aurora

provides a wide range of premium quality cannabis and hemp products and services, develops

innovative technologies, promotes cannabis consumer health and wellness, and delivers an

exceptional customer experience across all its brands.

• Aurora’s operations span multiple continents and focuses on both the medical and recreational

cannabis production and sales, patient education and clinic counselling services, home

hydroponic cultivation, extraction technologies and delivery systems, and hemp-based food

health products.

• Aurora operate around the globe pursuing new and emerging cannabis markets where possible

through their owned network of import, export and wholesale distributors, and our e-commerce

and mobile applications.

Financial Overview

• Wagner Dimas

• Evio Beauty Group

• Alumina Partners

Partners

M&A History

• June 12, 2018: Aurora Cannabis acquired

Anadia Labs

• May 14, 2018: Aurora Cannabis acquired

MedReleaf for $3.2B


CanniMed

• November 23, 2017: Aurora Cannabis acquired

Larssen Ltd


Pedanios

• March 6, 2017: Aurora Cannabis acquired

Peloton Pharmaceutical

• August 10, 2016: Aurora Cannabis acquired

CanvasRX Holdings

Key People

Brands Overview

Headquarter Alberta, Canada

Operating

countries

Germany, Denmark,

Italy and Australia

Foundation 2013


Website www.auroramj.com

Income Statements


Revenue - - 1 18

Gross profit - - 1 16

Operating income 0 (4) (6) (10)

Income before taxes 0 (10) (6) (17)

Net income 0 (10) (6) (13)

EPS Basic (0.02) (0.1) (0.04) (0.05)

EPS Diluted (0.02) (0.1) (0.04) (0.05)

Balance Sheet





Total assets 2 14 18 323


Total non-current liabilities - 2 4 80


Total stockholders' equity 1 4 6 219

Cash flow Statement



operating activities 0 (3) (7) (11)


activities (1) (8) (2) (50)




Free cash flow 0 (11) (9) (36)

Other Stats

FY-14 FY-15 FY-16 FY-17

N. of employees NA 64 232 800

Q1-17 Q2-17 Q3-17 Q4-17

Average selling price per

gram sold 8.36 8.22 7.45 6.64

Kilogram equivalent sold 1,161 889 755 653

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Company ProfilesAurora Cannabis


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PE 2019E PE 2020E

Share

price

(CAD)

Volume

(m)

EV/Reven

ue 2019E

(RE)

EV/Reven

ue 2020E

(RE)

EV/Reven

ue 2018E

(LE)

EV/Reven

ue 2019E

(LE)

EV/Reven

ue 2020E

(LE)

Min 1.9 0.2 5.1x 2.5x 9.6x 1.2x 0.6x

Max 11.9 13.9 62.3x 16.0x 74.9x 9.7x 5.0x

Latest 5.8 2.2 45.7x 5.9x 45.6x 5.9x 3.0x

Average 5.7 2.1 32.5x 7.1x 37.7x 4.9x 2.5x

Median 6.2 1.3 39.3x 7.1x 46.9x 6.1x 3.1x

`

EV/EBITDA

2020E (LE)

EV/EBIT

2020E

(RE)

PE 2020E

(LE)

PE 2019E

(RE)

PE 2020E

(RE)

Min 1.9x 2.9x 3.2x 0.0x 9.5x

Max 15.2x 22.7x 22.7x 298.5x 157.4x

Latest 9.2x 13.8x 13.0x 0.0x 116.0x

Average 7.6x 11.4x 11.2x 73.9x 54.6x

Median 9.5x 14.2x 13.6x 53.3x 44.9x

Company ProfilesMedReleaf

Neil J. Closner, CEO

& Co-Founder


• MedReleaf Corp is a Canada-based company which operates as a licensed producer of

cannabis-based pharmaceutical products.

• The Company produces and sells its dried cannabis and cannabis oil products, including

cannabis oil capsules.

• MedReleaf produce an aggregate of up to 6,000 kilograms of dried cannabis and up to 1,760

kilograms of cannabis oil, and to sell and distribute within Canada an aggregate of up to 5,000

kilograms of dried cannabis, up to 1,319 kilograms of bottled cannabis oil, and up to 440

kilograms of encapsulated cannabis oil.

• The Company is an analytically-driven organization focused on patient care, scientific innovation,

and advancing the understanding of the therapeutic benefits of cannabis.

• MedReleaf is a subsidiary of Aurora Cannabis.


Operating

countriesUSA

Foundation 2013

Expertise

Medical Cannabis,

Patient Care and

Medical Research

Website www.medreleaf.com

Financial Overview

Partners

M&A History

• May 14, 2018: MedReleaf was acquired by

Aurora cannabis for $3.2B

Income Statements


Revenue 3 19 40 44

Gross profit 3 13 38 41

Operating income (1) 3 16 (12)

Income before taxes (1) 3 16 (6)

Net income (1) 3 11 (8)

EPS Basic - 0.03 - (0.08)

EPS Diluted - 0.03 - (0.08)

Balance Sheet










Cash flow Statement



operating activities (4) 1 12 (13)


activities (2) (6) (32) (44)



Net change in cash 0 1 12 203

Free cash flow (7) (4) (19) (56)

Other Stats

FY-15 FY-16 FY-17 FY-18

N. of employees 35 58 145 220

Q1-18 Q2-18 Q3-18 Q4-18

Average selling price per

gram sold 9.04 9.34 8.98 8.91

Kilogram equivalent sold 1,157 1,051 1,263 5,034

Key People

Products Overview

Igor Gimelshtein, CFO

Donald J. Courtney, COO

62185081

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PE 2019E PE 2020E

Share

price

(CAD)

Volume

(m)

EV/Reven

ue 2018E

(RE)

EV/Reven

ue 2019E

(RE)

EV/Reven

ue 2018E

(LE)

EV/Reven

ue 2019E

(LE)

EV/Reven

ue 2020E

(LE)

Min 7.7 0.0 67.6x 39.0x 91.1x 17.3x 10.6x

Max 31.3 3.3 403.0x 114.1x 393.6x 74.9x 45.7x

Latest 26.0 1.2 335.1x 62.3x 327.3x 62.3x 38.0x

Average 17.9 0.5 212.9x 63.1x 221.7x 42.2x 25.8x

Median 18.0 0.4 231.4x 61.5x 224.1x 42.6x 26.0x

`

EV/EBITDA

2020E (LE)

EV/EBIT

2020E

(RE)

PE 2019E

(LE)

PE 2020E

(LE)

PE 2019E

(RE)

Min 31.6x 36.0x 93.1x 31.5x 382.5x

Max 136.5x 155.3x 403.9x 136.8x 1,565.0x

Latest 113.5x 129.1x 336.0x 113.8x 1,302.0x

Average 76.9x 87.5x 227.4x 77.0x 894.4x

Median 77.7x 88.4x 230.3x 78.0x 897.5x

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120.0x

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Company ProfilesMedReleaf


Company ProfilesAphria

Victor Neufeld, CEO & President

Key People


• Aphria Inc., formerly Black Sparrow Capital Corp., is a Canada-based company, which is

engaged in producing and selling medical marijuana through retail sales and wholesale channels.

• The Company's retail sales are primarily sold through the Company's online store, as well as

telephone orders. Its wholesale shipments are sold to other Medical Purposes Regulations

(MMPR) Licensed Producers. It offers medical cannabis of various strains, including Kusawa,

Tamaracouta, Panache, Churchill and Iroquois.

• Aphria Inc is also engaged in the research and development, and commercial production of

cannabis oil. Its cannabis oil products will include Champlain, Rideau and Capilano. Its cannabis

oil products will be available in approximately 60 milliliter bottles. Its subsidiaries include Pure

Natures Wellness Inc., which is engaged in producing and selling medical marijuana, and

Cannway Pharmaceuticals Ltd., which specializes in providing support services to veterans and

first responders.

Products Overview

• Capsules

• Oral Solution

• Cocentrate Syringes

• THC and CBD Vaporizers

Financial Overview

Partners

M&A History

• January 31, 2018: Aphria Inc acquired Nuuvera

• January 15, 2018: Aphria Inc avquired Broken

Coast Cannabis


Operating

countriesUSA

Foundation 2013


Website www.aphria.com

John Cervini, Co-Chairman and

Director

Carl Merton, CFO

Income Statements

in CADm FY-16 FY-17

Revenue 4 21

Gross profit 4 17

Operating income (1) 3

Income before taxes (14) 7

Net income (13) 7

EPS Basic - 0.09

EPS Diluted - 0.09

Balance Sheet

in CADm FY-16 FY-17

Cash and cash equivalents 5 18

Total current assets 12 44

Total non-current assets 5 34

Total assets 17 78

Total current liabilities 4 7

Total non-current liabilities 3 1

Total liabilities 6 8

Total stockholders' equity 10 71

Cash flow Statement

in CADm FY-16 FY-17


operating activities (2) (1)


activities (1) (31)


financing activities 5 44

Net change in cash 2 13

Free cash flow (3) (24)

Other Stats

FY-16 FY-17

N. of employees 123 212

Company ProfilesIsodiol International

Key People


• Isodiol International Inc, formerly Laguna Blends Inc, is a Canada-based company specializing in

the development of pharmaceutical and consumer products.

• The Company is focused on the nutritional health benefits that are derived from hemp and is a

product development, sales, marketing and distribution company of hemp-based consumer

products and solutions.

• Its nutraceutical division is focused on hemp-derived products, including crystalline isolate, micro-

encapsulation, and nanotechnology for the consumable and topical skin care products.

• It is also focused on over-the-counter and pharmaceutical drugs, seeking joint ventures and

acquisitions to expand its portfolio of brands and subsidiaries.

Products Overview

Financial Overview

Partners

M&A History

• May 2, 2018: Isodiol International acquire 51%

of Farmtiva & Commence Hemp Farming In

California

• December 8, 2017: Isodiol Intenational acquired

Be Tru Organics

• December 8, 2017: Isodiol Intenational acquired

C3 Global Bioscence

Headquarter Vancouver, Canada

Operating

countriesUSA

Foundation 2014


Website www.isodiol.com

Income Statements

in CADm FY-15 FY-16 FY-17

Revenue - 0.2 3.5

Gross profit - 0 0

Operating income (1) (2) (3)

Income before taxes (1) (9) (4)

Net income (1) (9) (4)

EPS Basic (0.1) 0.6 0.1

EPS Diluted (0.1) 0.6 0.1

Balance Sheet


Cash and cash equivalents 0 0 1

Total current assets 0 0 1

Total non-current assets 0 - 1

Total assets 1 0 2

Total current liabilities 0 1 0

Total non-current liabilities 0 1 0

Total liabilities 0 1 0

Total stockholders' equity 0 -1 2

Cash flow Statement



operating activities 0 (2) (3)


activities 0 - 0


financing activities 1 2 4

Net change in cash 0 0 1

Free cash flow 0 (2) (3)

Other Stats

FY-15 FY-16 FY-17

N. of employees 11 13 25

Company ProfilesMPX Bioceutical Corporation

Key People


• MPX Bioceutical Corporation is a multinational diversified cannabis company focused on the

medical and adult use cannabis markets.

• The company has a growing presence in the U.S. with imminent plans for ten dispensaries and

four production facilities in four states. It also has a production facility under construction in

Canada as well as a pending licence application to Health Canada.

• In addition to its well established Melting Point Extracts (MPX) brand, the company’s foundation is

built on its profitable operations in Arizona, where it has three fully operational Health for Life

dispensaries and The Holistic Center (acquired March 5, 2018) , giving it a total of four

dispensaries in this state.

• In Nevada, MPX is operating GreenMart, a fully licensed cultivation, production and wholesale

cannabis business.

• In Massachusetts, the construction of the first of three dispensaries is underway as is construction

of a cultivation and processing facility in Falls Rivers.

• MPX is also managing three dispensaries and one production facility in Maryland (which are not

yet operational) and has options to acquire each facility.

• On August 23, 2017, the Company was advised that its application for Licensed Producer status

from Health Canada was at the Detailed Review and Initiation of Security Clearance Process

stage and has started construction of its 72,342 square foot production facility.

• With all production facilities, MPX anticipates that it will have 9 million grams per annum in

cultivation capacity and be able to produce 1.2 million grams of concentrates.

Products Overview

Financial Overview

Partners

M&A History


Operating

countriesUSA

Foundation 2014


Websitewww.mpxbioceutical.c

om

• April 17, 2018: MPX Bioceutical Corporation

acquired Canveda

• Capsules

• Oral Solution

• Oil

• THC and CBD Vaporizers

Scott Boyes, CEO & President

David Mclaren, CFO

Beth Stavola, COO

Income Statements


Revenue - 0.2 3.5

Gross profit - 0 0



Net income (1) (9) (4)

EPS Basic (0.1) 0.6 0.1

EPS Diluted (0.1) 0.6 0.1

Balance Sheet




Total non-current assets 0 - 1

Total assets 1 0 2




Total stockholders' equity 0 -1 2

Cash flow Statement



operating activities 0 (2) (3)


activities 0 - 0




Free cash flow 0 (2) (3)

Other Stats

FY-15 FY-16 FY-17

N. of employees 11 13 25

Company ProfilesTerra Tech Corp

Key People


• Terra Tech Corp., incorporated on July 22, 2008, is a vertically integrated cannabis-focused

agriculture company. The Company is focused on cultivating and providing medical cannabis, as

well as other agricultural products, such as herbs and leafy greens that are grown using Dutch

hydroponic farming methods.

• The Company operates through two segments: Hydroponic Produce and Cannabis Products.

The Company, through its subsidiary, GrowOp Technology Ltd. (GrowOp Technology), is

engaged in the design, marketing and sale of hydroponic equipment with technology to create

sustainable solutions for the cultivation of indoor agriculture.

• The Company's hydroponic produce is locally grown hydroponic produce that is started from seed

and is grown in environmentally controlled greenhouses.

• Terra Tech Corp., operates in the commercial agriculture and retail agriculture markets. GrowOp

Technology's products are interchangeable for all agriculture, including medical marijuana. Edible

Garden's products are sold at approximately 1,800 retailers

Brands Overview

Financial Overview

Partners

M&A History

Headquarter California, USA

Operating

countries-

Foundation 2010


Websitewww.terratechcorp.co

m

• March 31, 2016: Terra Tech Corp., acquired

Black Oak Gallery

• April 24, 2013: Terra Tech Corp., acquired Gro-

Rite

• January 14, 2013: Terra Tech Corp., acquired

Blüm Oakland

Derek Peterson, CEO &

Chairman

Michael James, CFO

Michael Nahass COO,

Director and President

Income Statements

in USDm FY-14 FY-15 FY-16 FY-17

Revenue 7 10 25 36




Net income (22) (9) (27) (33)

EPS Basic 2.0 0.6 1.1 0.7

EPS Diluted 2.0 0.6 1.1 0.7

Balance Sheet










Cash flow Statement



operating activities (8) (5) (10) (16)


activities (2) (2) (4) (15)



Net change in cash 1 0 9 (4)

Free cash flow (10) (7) (14) (22)

Other Stats

FY-14 FY-15 FY-16 FY-17


Company ProfilesGW Pharmaceuticals

Key People


• GW Pharmaceuticals plc is a biopharmaceutical company focused on developing and

commercializing therapeutics from its cannabinoid product platform in a range of disease areas.

The Company's lead cannabinoid product candidate is Epidiolex, which is a liquid formulation of

pure plant-derived cannabidiol (CBD).

• The Company offers Sativex (nabiximols), which is indicated for the treatment of spasticity due to

multiple sclerosis (MS). The Company operates through three segments: Commercial, Sativex

Research and Development, and Pipeline Research and Development.

• The Commercial segment distributes and sells the Company's commercial products. The Sativex

Research and Development segment seeks to maximize the potential of Sativex through the

development of new indications.

• The Pipeline Research and Development segment seeks to develop cannabinoid medications

other than Sativex across a range of therapeutic areas using its cannabinoid technology platform.

Therapeutic Areas

Financial Overview

Partners

Products Overview

Headquarter Cambridge, UK

Operating

countriesUSA

Foundation 1998

Expertise Biopharmaceutic

Website www.gwpharm.com

• Cannabidiol (CBD) Oral Solution: Now

approved as Epidiolex in the United States; an

investigational drug not approved for use by any

other national regulatory agency.

• Sativex® (nabiximols): Sativex® is an

oromucosal spray of a formulated extract of the

cannabis sativa plant that contains the principal

cannabinoids delta-9-tetrahydrocannibinol (THC)

and cannabidiol (CBD) in a 1:1 ratio as well as

specific minor cannabinoids and other non-

cannabinoid components

• Epilepsy

• Autism Spectrum Disorders

• Glioma

• Neonatal Hypoxic-Ischemic

Encephalopathy

• Schizophrenia

• Cerebral Palsy in Children

Income Statements

in GBPm FY-14 FY-15 FY-16 FY-17

Revenue 30 29 10 8




Net income (15) (45) (64) (132)

EPS Basic (0.1) (0.2) (0.2) (0.4)

EPS Diluted (0.1) (0.2) (0.2) (0.4)

Balance Sheet





Total assets 194 290 435 333





Cash flow Statement



operating activities (13) (46) (85) (110)


activities (7) (18) (9) (15)


financing activities 144 128 207 (2)

Net change in cash 126 70 140 (133)

Free cash flow (20) (65) (94) (127)

Other Stats

FY-14 FY-15 FY-16 FY-17

N. of employees 265 369 496 568

Company ProfilesCV Sciences

Key People


• CV Sciences, Inc., incorporated on July 26, 2013, is a life science company. The Company

operates in two segments: specialty pharmaceuticals and consumer products.

• The Company’s specialty pharma business segment is focused on developing and

commercializing therapeutics utilizing synthetic Cannabidiol (CBD) across several therapeutic

areas.

• The consumer product business segment is focused on manufacturing, marketing and selling

plant-based CBD products to a range of market sectors.

• The Company's product candidates utilize synthetic CBD as the active pharmaceutical ingredient.

Its product candidates are in preclinical studies.

• The Company manufactures, markets and sells products containing hemp-derived CBD primarily

under its PlusCBD brand.

Therapeutic Areas

Financial Overview

Products Overview

M&A History

Headquarter Nevada, USA

Operating

countries-

Foundation 2013

Expertise Biotechnology

Website www.cvsciences.com

• December 2015: CV Sciences acquired CanX

Inc., a pre-clinical drug development company

focused on significant unmet medical needs.

• CV Sciences operates two distinct

divisions:

• PHARMACEUTICALS: CV Sciences’

Pharmaceutical Division is developing

synthetically‐formulated

cannabidiol‐based medicine, pursuing

the approval of the U.S. FDA for

drugs with specific indications utilizing

cannabidiol as the active

pharmaceutical ingredient.

• CONSUMER PRODUCTS: CV

Sciences’ Consumer Products

Division delivers botanical‐based

cannabidiol products that enhance

quality of life. Currently distributed

nationally in health food stores, health

care provider’s offices and online.

Income Statements


Revenue 10 12 11 21




Net income (1) (12) (14) (5)

EPS Basic (0.0) (0.4) (0.3) (0.1)

EPS Diluted (0.0) (0.4) (0.3) (0.1)

Balance Sheet







Total non-current liabilities - 2 2 3



Cash flow Statement



operating activities (7) (4) (2) 4


activities (1) (2) 1 (2)




Free cash flow (7) (4) (2) 3

Other Stats

FY-14 FY-15 FY-16 FY-17


Company ProfilesGolden Leaf

Key People


• Golden Leaf Holdings Ltd (GLH) is a Canada-based cannabis oil and solution provider in North

America. The Company produces and distributes various types of products, such as cannabis

flower and cannabis oils.

• Golden Leaf Holdings Ltd is in the business of producing and distributing cannabis oil and flower

products within adult-use regulated market. The brand line of the company consists of golden,

proper, left coast connection, and chalice farms.

• The Company owns a dispensary through its subsidiary, Left Coast Connections. GLH operates

cultivation business through its subsidiary, Greenpoint Oregon, Inc. (GPO). GPO uses over two

separate extraction methods for extracting cannabis oil, such as carbon dioxide (CO2) extraction

and hydrocarbon extraction.

• The company also gets royalties for the product it produces. It also focuses on owning a fully-

licensed dispensary from which it sells cannabis products.

Products Overview

Financial Overview

Brands Overview

M&A History

Headquarter Oregon, USA

Operating

countries-

Foundation 2014

ExpertiseMedical and

Recreative Cannabis

Websitewww.goldenleafholdin

gs.com

• July 10, 2017: Golden Leaf acquired Chalice

Farms

Income Statements

in USDm FY-15 FY-16 FY-17

Revenue 10 8 12

Gross profit 2 0 2



Net income (17) (21) (56)

EPS Basic (0.3) (0.2) (0.2)

EPS Diluted (0.3) (0.2) (0.2)

Balance Sheet




Total non-current assets 6 16 64

Total assets 9 25 76




Total stockholders' equity (2) (3) 18

Cash flow Statement



operating activities (7) (9) (16)


activities (3) (2) (21)




Free cash flow (10) (10) (17)

Other Stats

FY-15 FY-16 FY-17

N. of employees NA NA 166

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ue 2018E

(RE)

EV/Reven

ue 2019E

(RE)

EV/Reven

ue 2018E

(LE)

EV/Reven

ue 2019E

(LE)

EV/Reven

ue 2020E

(LE)

Min 7.7 0.0 67.6x 39.0x 91.1x 17.3x 10.6x

Max 31.3 3.3 403.0x 114.1x 393.6x 74.9x 45.7x

Latest 26.0 1.2 335.1x 62.3x 327.3x 62.3x 38.0x

Average 17.9 0.5 212.9x 63.1x 221.7x 42.2x 25.8x

Median 18.0 0.4 231.4x 61.5x 224.1x 42.6x 26.0x

`

EV/EBITDA

2020E (LE)

EV/EBIT

2020E

(RE)

PE 2019E

(LE)

PE 2020E

(LE)

PE 2019E

(RE)

Min 31.6x 36.0x 93.1x 31.5x 382.5x

Max 136.5x 155.3x 403.9x 136.8x 1,565.0x

Latest 113.5x 129.1x 336.0x 113.8x 1,302.0x

Average 76.9x 87.5x 227.4x 77.0x 894.4x

Median 77.7x 88.4x 230.3x 78.0x 897.5x

Company ProfilesGolden Leaf


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Documents

Cannabis Industry Report - WordPress.com...increase in the S&P 500. Public companies have been trading at 2.6x 2020 Revenue and 8.1x 2020 EBITDA. Table of contents 1. Market landscape