Empower Clinics JV Could Generate $US 30,000,000 In Annual Revenue From CBD Extraction … But It Doesn’t End There

With 165,000 patients, Empower Clinics (CBDT:CSE) (EPWCF:OTCQB) has a database that almost every medical cannabis and CBD company would kill for.  Add in the fact it is now on a ~ $USD 4,000,000 annualized revenue run rate for 2019 and it becomes the kind of company small cap investors have been dying to find as they watch pretender companies melt away.

But it doesn’t end there.

The Company’s latest Q3 financials show that Empower is in full growth mode, with substantial increases in revenue and patient visits, as well as, big reductions in expenses.  Moreover, Company CEO Steven McAuley says growth will continue full steam ahead in Q4, Q1 and beyond.

But it doesn’t end there. 

CBD extraction has been a key element of the company’s vertical integration. Producing its’ own hemp-derived CBD products for its own massive patient list just makes sense. However, thanks to an LOI (moving towards definitive agreement) to JV with extraction experts Heritage Cannabis, the Company’s 5,000 sq ft facility in Oregon is also planning to serve big brand 3rd party partners in the USA .  Empower brings the infrastructure, Heritage brings the expertise and balance sheet.  The result is a match made in shareholder heaven with initial annual capacity of 6,000 Kg at ~ $US 5,000 per Kg, which adds up to $US 30,000,000 in potential revenue.

We emphasize potential  because nobody has started selling anything yet but the facility is expected to begin producing soon.  However, with a built in patient database and talks already having commenced for white label products, Empower is on its way.  Moreover, “potential” cuts both ways, with capacity capable of increasing 2x – 3x without much trouble given the size of the facility.  

Can Empower successfully execute its extraction plan?  It’s a legitimate question, with a blow away answer..
The Company’s new CEO, Steven McAuley, who replaced the previous management team in January, is Six Sigma certified under the quality initiative of legendary GE chairman Jack Welch. We’ve never seen a Six Sigma certified CEO in the Canadian small cap markets. Never …. which also explains how McAuley has brought Empower to such heights in just 11 months.

The cannabis market is currently throwing away babies with the bathwater – but just as the dot-com crash brought us massive riches through Web 2.0 companies that were REAL, investors need to start looking for the REAL companies that will survive and thrive.  With 165,000 patients, rapidly increasing revenues, a franchise plan to grow clinics across America and a vertical integration CBD extraction strategy to tie them all together, Empower Clinics may be such a company.  

Grab your favourite beverage and settle in to watch what may be your next great small cap investment.