Halo Collective Receives All Approvals for Budega™ Dispensary in North Hollywood, California
State License Enables Halo to Begin Retail Sales
All Figures in U.S. Dollars Unless Otherwise Stated
TORONTO, Feb. 25, 2022 /CNW/ - Halo Collective Inc. ("Halo" or the "Company") (NEO: HALO) (OTCQB: HCANF) (Germany: A9KN) today announced that it has received all final approvals from the Los Angeles Department of Cannabis Regulation (the "DCR") and California Department of Cannabis Control (the "DCC") to commence adult-use sales at its Budega branded retail dispensary in the Arts District of North Hollywood, California ("NoHo"). With the required license and permits in hand, the Company's focus has transitioned from the regulatory approval process to further readying the location to open. This includes implementing the State's required "track and trace" system, receiving initial product orders from vendors, merchandizing the store and preparing for its first customers in early March.
The 1,200 square foot retail facility is strategically located at the northwest corner of Lankershim Boulevard and Hesby Avenue in the NoHo Arts District, a vibrant and heavily trafficked section of metropolitan Los Angeles. NoHo is fast developing, with over $1 billion being invested over the coming years in a series of large-scale housing and commercial development projects1.
"It has been a lengthy, complicated process to get to this pivotal and exciting moment for the Halo team. Despite the ongoing challenges COVID and external forces have presented us, we have persevered and our first Budega store in NoHo is on the verge of opening. With the licenses in place the team can begin the final stages of preparing and stocking the store for its opening," said Katie Field, President and Director of Halo.
Retail Strategy Budega
The NoHo location is expected to generate up to $10 million of annual retail sales at maturity2. The Company is also licensed for delivery, and this additional service is expected to increase top-line sales and help capture overall market share. The NoHo location's delivery service area will include Studio City, North Hollywood, Hollywood Burbank, and the Eastern San Fernando Valley.
Budega will offer a product assortment exceeding 1,000 SKUs, including many top-tier California brands and the debut of the Budega branded product lineup. The Budega dispensaries will also stock Halo's Hush™ branded cartridges, gummies and pre-rolls. Ms. Field commented further, "Not only will the opening of NoHo significantly increase our topline net revenue but, furthermore, the Company expects to increase profit before tax margins by stocking up to twenty percent of Budega's shelf space with Halo brands and products."
California remains the highest-grossing state for cannabis retail sales in the United States but also has among the lowest per capita density among other mature recreational cannabis markets. There are approximately 250 licenses3 in Los Angeles County for a population of 3.9 million across 500 square miles, compared to Oregon, which has a population of 4.3 million people and approximately 800 stores4 across 98,466 square miles5. In California, licensed cannabis shops offering legal goods are more sparsely scattered across the state. There are roughly two licenses per 100,000 people in California, one of the lowest rates in the nation among states that support legal recreational sales. By comparison, Oregon has 18 retail shops for every 100,000 residents. Colorado boasts a similar ratio, and Washington state's rate is more than triple California's6.
___________________________ |
2 Based on a standard 12-month ramp based on Management's estimates and experience in the cannabis sector and utilizing a proforma matrix taking into account time to saturate the applicable market with branding and consumer awareness. The topline projection number were further prepared using Management's retail algorithm which factors known market conditions, size of store, historical data, area traffic counts and estimated market / consumer size and other third-party data sources. |
3 Downloaded from DCC license database https://search.cannabis.ca.gov/. |
About Halo Collective Inc.
Halo is a leading, vertically integrated cannabis company focused on the West Coast of the United States and operates other emerging businesses in CBD and non-psychotropic mushroom functional beverages. In its cannabis operations, the Company cultivates, extracts, manufactures, and distributes quality cannabis flower, oils, and concentrates and has sold hundreds of millions of grams of cannabis in the form of flower, pre-rolls, vape carts, edibles, and concentrates since inception. The Company sells a portfolio of branded cannabis products including its proprietary Hush™, Winberry Farms™, Williams Wonder Farms, and Budega™ brands, and under license agreements with Papa's Herb®, DNA Genetics, Terphogz, and FlowerShop*.
In Oregon, Halo has a combined 14 acres of owned and contracted outdoor and greenhouse cultivation. The Company also operates Food Concepts LLC, a master tenant of a 55,000 square foot indoor cannabis cultivation, processing, and wholesaling facility in Portland.
In California, Halo maintains licenses for extraction, manufacturing, and distribution. The Company has partnered with Green Matter to purchase the Bar X Farm in Lake County and plans to develop up to 63 acres of cultivation, comprising one of the largest licensed single-site grows in California. Halo is opening three retail dispensaries in Los Angeles under the Budega™ brand in North Hollywood, Hollywood, and Westwood.
Halo is also expanding into other consumer health and wellness categories expected to experience rapid growth in consumer demand, including functional supplements such as nootropic nutraceuticals. The Company has recently agreed to acquire H2C Beverages, a company focused on cannabinoids and non-psychotropic mushroom functional beverages, and entered into a distribution and manufacturing agreement with Elegance Brands Inc., to propel the national distribution of beverages, capsules, and topical supplements under H2C and Halo's functional mushroom brand, Hushrooms.
Halo has acquired a range of software development assets, including CannPOS, Cannalift, CannaFeels, and a discrete sublingual dosing technology, Accudab. The Company intends to reorganize these entities (including their intellectual property and patent applications) into a subsidiary called Halo Tek Inc., and to complete a distribution of the shares of Halo Tek Inc. to shareholders on record, at date to be determined.
Outside of North America, Halo is the largest shareholder of Akanda Corp. ("Akanda"), an international medical cannabis company whose mission is to be the world's leading platform for medical cannabis and wellness products. Led by an experienced global leadership team and guided by the highest ethical standards, Akanda is building a unique seed-to-patient model that leverages the competitive advantages of its cultivation campus in the Kingdom of Lesotho and a distribution marketplace and other innovative solutions designed to maximize patient access and choice. Halo also operates three Kushbar retail cannabis stores located in Alberta, Canada, leveraging its Oregon and California brands.
___________________________ |
4 Downloaded from https://www.oregon.gov/olcc/marijuana/Pages/Marijuana-Market-Data.aspx |
5 Population figure sources include US Census Bureau. Square miles are sourced from https://worldpopulationreview.com/us-cities/los-angeles-ca-population. |
6 https://www.politico.com/news/2021/10/23/california-legal-illicit-weed-market-516868 |
For further information regarding Halo, see Halo's disclosure documents on SEDAR at www.sedar.com.
Connect with Halo Collective: Email | Website | LinkedIn | Twitter | Instagram
Cautionary Note Regarding Forward-Looking Information and Statements
This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". Forward-looking information may relate to anticipated events or results including, but not limited to the anticipated licensing and opening of the Company's Budega-branded retail dispensaries in California and the prospects thereof, including projected annual sales revenue, management's plans regarding its portfolio of cannabis businesses, the Company's expansion plans regarding Canada, the expected size and capabilities of the final facility planned at Ukiah Ventures, the size of Halo's planned cultivation facility in Northern California, and the ability of Bophelo and Canmart to serve the UK market and the proposed spin-off of Halo Tek Inc.
By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: inability of management to successfully integrate the operations of acquired businesses, changes in the consumer market for cannabis products, changes in the expected outcomes of the proposed changes to Halo's operations, delays in obtaining required licenses or approvals necessary for the build-out of Oregon operations, dispensaries or Canadian operations, the proposed spin-out with Halo Tek Inc., delays or unforeseen costs incurred in connection with construction, the ability of competitors to scale operations in Northern California, delays or unforeseen difficulties in connection with the cultivation and harvest of Halo's raw material, changes in general economic, business and political conditions, including changes in the financial markets; and the other risks disclosed in the Company's annual information form dated March 31, 2021 and other disclosure documents available on the Company's profile at www.sedar.com. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice.
Third Party Information
This press release includes market and industry data that has been obtained from third party sources, including industry publications. The Company believes that the industry data is accurate and that its estimates and assumptions are reasonable, but there is no assurance as to the accuracy or completeness of this data. Third party sources generally state that the information contained therein has been obtained from sources believed to be reliable, but there is no assurance as to the accuracy or completeness of included information. Although the data is believed to be reliable, the Company has not independently verified any of the data from third party sources referred to in this press release or ascertained the underlying economic assumptions relied upon by such sources
Non-Solicitation
This press release shall not constitute an offer to sell nor the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
SOURCE Halo Collective Inc.
Halo Collective Inc., Investor Relations, [email protected], www.haloco.com/investors
Share this article