Although 2020 has been a challenging year for the global economy, some industries have been benefiting from the COVID-19 pandemic and have been reporting impressive growth.
The cannabis industry has been one of the beneficiaries of the pandemic, and many states have reported record monthly revenues since quarantine began. This trend was especially apparent in states that have legalized adult use cannabis, and we have been focused on identifying businesses that are positioned to thrive in the current market environment.
One of the companies that we have been excited about is ManifestSeven Holdings Corporation (CSE: MSVN), which is revolutionizing the way cannabis gets from point A to point B and translating it into a fully licensed end-to-end logistics solution for the booming California cannabis industry. The company is California’s first integrated omnichannel platform for the legal cannabis market.
Consolidating distribution, delivery and dispensary operations into a singular B2B and B2C omnichannel infrastructure across the world’s largest single market is creating the first “Cannabis Superhighway.” M7 has an expansive network of four facilities and has an expanding portfolio of retail operations located in major metro markets. The operations including brick-and-mortar dispensaries, local on-demand delivery services, e-commerce, and subscription offerings. We are favorable on the diversity of the business and consider M7 to be a differentiated opportunity.
During the early tumultuous days of the COVID-19 crisis in the United States, when cannabis was deemed an essential service, M7’s distribution and retail operations have proven to be major revenue growth drivers, and this is a trend that is expected to provide a tailwind in the coming quarters. So far this year, the company has been reporting increasing revenues while cutting its burn rate and this is a trend that we expect to continue. If the management team can execute, we expect the business to continue to record strong revenue growth, improve its operating margins and drive shareholder value.
In October, M7 released its third quarter 2020 financial results, in which the company reported record revenue and robust growth in cannabis operations, fueled by dynamic customer acquisition growth across all operating segments.
Among the financial highlights, revenue for the three and nine months ended August 31, 2020, increased 64% and 96% year-over-year to $4.7 million and $13.8 million, respectively. In addition, revenue from cannabis distribution, delivery and dispensary operations – the Company’s core operating segment – for the nine months ended August 31, 2020 increased 217% year-over-year to $9.3 million. As another snapshot of progress, M7 generated record revenue of $3.5 million from ongoing cannabis operations for the three months ended August 31, 2020, an increase of 94% year-over-year and 30% sequentially.
We view these financial results as the continuation of M7’s pathway to net profitability. The cannabis omnichannel platform is an opportunity we are bullish on and will monitor how the story advances in the coming quarters.
By being a public company, M7 is using its stock as a currency to make investments and acquisitions. We are favorable on the impact that the public listing will have on the business and expect the opportunity to gain traction on the CSE under the symbol MSVN.
We are favorable on the growth prospects that are associated with the California cannabis industry and will monitor how M7 is able to capture additional market share. We believe that M7 possess the traits that are needed to be successful in the California market and are favorable on how the management team has been able to execute on previously announced initiatives. The California cannabis company has visible growth prospects and we are favorable on the risk-reward profile that is associated with the business.
If you are interested in learning more about M7 and the planned go-public transaction, please send an email to firstname.lastname@example.org to be added to our distribution list.
Pursuant to an agreement between StoneBridge Partners LLC and Manifest7. (MSVN) we have been hired for a period of 180 days beginning August 1, 2019 and ending February 1, 2020 to publicly disseminate information about (MSVN) including on the Website and other media including Facebook and Twitter. We are being paid $10,000 per month for or were paid “ZERO” shares of unrestricted or restricted common shares. We own zero shares of (MSVN), which we purchased in the open market. We may buy or sell additional shares of (MSVN) in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information. This agreement was renewed for a 180 day extension on Oct 1, 2020.