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Earlier this week, Australis Capital Inc. (CSE: AUSA) (OTC: AUSAF) reported a major milestone and formed an agreement with Arizona’s largest cannabis wholesaler, Copperstate Farms Management, through its majority owned subsidiary ALPS.
We are bullish on the relationship with Copperstate Farms and consider it to be a potential major revenue driver for the business. Currently, Copperstate Farms operates a 40-acre (approx. 1.7 million square-foot) greenhouse that is focused on the production of premium medical and recreational cannabis in Arizona.
According to the two-year contract, ALPS will execute on the project in two phases. Over the two-year term, the contact is expected to worth up to $6 million, and we are favorable on how the project could lead to Australis forming additional strategic relationships with leading US multi-state operators (MSOs).
The first phase of the Copperstate Farms contract is focused on having ALPS implement a full technology and workflow upgrade of its existing facility. The upgrades include industrial greenhouse management solutions, enhanced cultivation practices, compliance upgrades and computerized maintenance management services through ALPS’ APIS offering.
APIS is an Internet of Things type solution that provides access to key performance indicators that can be used to optimize quality and economic output of a facility. A key benefit of APIS is related to the highly sophisticated preventative maintenance capabilities that is offered through it. The capabilities can generate a substantial return on investment through increased facility yields, higher product quality, and significantly reduced facility downtime. We understand that interest in that APIS offering is strong and for APIS to become a major driver of recurring revenues.
ALPS is Expected to Support the Growth of Copperstate
By utilizing ALPS’ services, Copperstate Farms expects to generate larger yields and enhance product quality. Through the relationship, Arizona’s largest cannabis wholesaler is expected to have enough capacity to capitalize on the increased demand for cannabis flower and cannabis derivative products in a way that complies with state regulations.
Another part of the phase 1 expansion is related to providing engineering support for the construction of a state-of-the-art processing and manufacturing facility in Tempe, Arizona. A key aspect of the contract is related to how ALPS will support Copperstate Farms to have the facility comply with good manufacturing practices (GMP) standards and will monitor how the project advances from here.
In the second phase of the project, Copperstate intends to utilize ALPS for the design, construction management, and (post) commissioning services that are related to the previously announced planned expansion of its greenhouse facility. The new facility will benefit from the valuable intellectual property (IP) that has been developed by ALPS and its technology partners to deliver premium cannabis that is produce at near industry low operating costs.
A Growth Story that is Flying Under the Radar
The agreement between ALPS and Copperstate Farms further accelerates Australis’ revenue growth and will provide the resources that are needed to fuel the expansion of its US cannabis operations. We are favorable on the level of quality that is associated with the companies that Australis works with or invests in.
So far this year, Australis has been nothing short of an execution story, and we expect the company to enter into additional agreements that are similar to the one that it has with Copperstate Farms. We believe the recent additions to the management team have benefited Australis and are bullish on the direction the business is going.
Australis is focused on executing on a capital light US expansion strategy. Through a series of inorganic and organic growth initiatives, the company is well positioned to record rapid growth, and this is an opportunity that we are excited about.
If you are interested in learning more about Australis Capital, please send an email to support@technical420.com with the subject “Australis Capital” to be added to our distribution list.
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Pursuant to an agreement between StoneBridge Partners LLC and Australis Capital Inc. we have been hired for a period of 180 days beginning February 8, 2020 and ending August 8, 2021 to publicly disseminate information about (AUSA) including on the Website and other media including Facebook and Twitter. We are being paid $6,000 per month (AUSA) for or were paid “ZERO” shares of unrestricted or restricted common shares. We plan to sell the “ZERO” shares of (AUSA) that we hold during the time the Website and/or Facebook and Twitter Information recommends that investors or visitors to the website purchase without further notice to you. We may buy or sell additional shares of (AUSA) in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information.
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