working copy of new deck dec 2017 - world-class …...2018/01/01 · pªªp{ À;¯...
TRANSCRIPT
#greentogold
Ancillary equipment, products and services for the cannabis industry
CSE:QCC
F ORWARD L OOK ING S TA T EMENTSThis investor presentation dated Fal l 2017 (the “Presentation ” ) contains “ forward- looking information ” within the meaning of applicable Canadian
securit ies laws and “ forward looking statements ” within the meaning of the United States Private Securit ies Lit igat ion Reform Act of 1995
(col lect ively , “Forward Looking Statements ” ) regarding Quadron Cannatech Corporat ion ( “Quadron ” or the “Company ” ) and i ts subsidiar ies . Except for
statements of histor ical fact , certain information contained herein constitutes forward- looking statements which include management ’s assessment
of future plans and operations and are based on current internal expectat ions , est imates , project ions , assumptions and bel iefs , which may prove to
be incorrect . Often , but not always , forward- looking statements can be identi f ied by the use of words and phrases such as “est imates ” , “ forecasts ” ,
“project ion ” “anticipates ” , “bel ieves ” “expects ” or “ i s expected ” , or “plans ” , “ intends ” , “budgets ” , “goals , ” “objectives , ” “targets , ” or “scheduled ” or
var iat ions ( including negative var iat ions ) of such words and phrases , or statements that certain actions , events or results “may ” , “could ” , “should , ”
“would ” , “might ” or “wil l ” be taken , occur or be achieved . Forward- looking statements are based on the opinions and est imates of management as of
the date such statements are made and are based on var ious assumptions such as : ( i ) the Company ’s abil i ty to generate cash f low f rom operations
and obtain necessary f inancing on acceptable terms ; ( i i ) general economic , f inancial market , regulatory and polit ical condit ions in which the
Company operates ; ( i i i ) consumer interest in Company products ; ( iv ) anticipated and unanticipated costs ; (v ) government regulat ion of the
Company ’s activ it ies and products ; (vi ) the t imely receipt of any required regulatory approvals ; (vi i ) the Company ’s abil i ty to obtain qual i f ied staff ,
equipment and services in a t imely and cost eff ic ient manner ; the Company ’s abil i ty to conduct operations in a safe , eff ic ient and effect ive manner ;
(vi i i ) and the Company ’s construction plans , expansion of faci l i t ies , i ts costs and t imeframe for completion of such plans . Forward- looking statements
are not guarantees of future performance and undue rel iance should not be placed on them . Forward- looking statements involve known and
unknown r isks , uncertaint ies and other factors , which may cause the actual results , performance or achievements of Quadron to be material ly
dif ferent f rom any future results , performance or achievements expressed or implied by the forward- looking statements . Many of these r isk factors
and uncertaint ies are discussed in certain Company documents , in a section entit led “Risk Factors ” , and f i led with the Canadian Securit ies
Administrators which are avai lable on SEDAR at www .sedar .com . Although the Company has attempted to identi fy important factors that could
cause actual actions , events or results to dif fer material ly f rom those described in forward- looking statements , there may be other factors that cause
actions , events or results to dif fer f rom those anticipated , est imated or intended . Forward- looking statements contained herein are made as of the
date of this Presentation and the Company disclaims any obligation to update any forward- looking statements , whether as a result of new
information , future events or results , except as may be required by applicable securit ies laws . There can be no assurance that forward- looking
statements wil l prove to be accurate , as actual results and future events could dif fer material ly f rom those anticipated in such statements .
Accordingly , readers should not place undue rel iance on forward- looking statements . Securit ies Laws . This Presentation i s for informational purposes
and does not constitute an offer or a sol ic itat ion of an offer to purchase the securit ies referred to herein . No Reproduction or Distr ibution : The
contents of this presentation are not to be reproduced or distr ibuted to any third party , including the general public or the media , without the
express written consent of Quadron . The information contained herein , while obtained f rom avai lable sources which the Company bel ieves are
rel iable , i s not guaranteed as to i ts accuracy or completeness . Third Party Information : Certain information contained in this Presentation with
respect to market trends and products has been obtained or quoted f rom publicly avai lable sources , such as continuous disclosure documents ,
independent publicat ions , media art icles , third party websites (col lect ively , the “Publicat ions ” ) . In certain cases , these sources make no
representat ions as to the rel iabi l i ty of the information they publish . Further , the analyses and opinions ref lected in these Publicat ions are subject to
a ser ies of assumptions about future events . There are a number of factors that can cause the results to dif fer material ly f rom those described in
these publicat ions . None of the Company or i ts representat ives independently veri f ied the accuracy or completeness of the information contained in
the Publicat ions or assume any responsibi l i ty for the completeness or accuracy of the information derived f rom these Publicat ions . Addit ional
Information : Addit ional information relat ing to the Company has been f i led electronical ly through SEDAR and i s avai lable onl ine at www .sedar .com
or at the Company ’s website at www .quadroncannatech .com .
Cannabis oil consumption in Canada is expected to grow from 284L in 2015
to 562,613L by 2020 (198,000% growth) vs. dried marijuana consumption
of 6,388 kg in 2015 to 110,034 kg in 2020 (1,600% growth).
Mackie Research Focus Report, April 8, 2016 at page 24
$ 1 2 6M $3 1 7M $ 1 , 1 8 6M $2 , 1 5 1M
2016 2017E 2018E 2019E
CANADIAN CANNABIS MARKET FORECASTA S S UM I N G F U L L L E GA L I ZA T I O N I N 2 0 1 8
Dried Cannabis Sales CAD$ MExtract /Oil Sales CAD$ M
Total Market Size CAD$ M
Total increase of 34% from Apr 2017-Sep 2017 in Cannabis oil sold, compared to 3% for dried cannabis
There was a 23% increase in Q2 over Q1 cannabis oil that was sold to clients
There was 29% more cannabis oil sold to clients in Sep Q2 2017 than dried cannabis
8,585 kg inventory of cannabis oil compared to 29,312 kg inventory of dried cannabis as of Sept 2017
13,863 kg cannabis oil sold April - Sept 2017 compared to 11,801 kg of dried cannabis (17% differential)
Ref: https://www.canada.ca/en/health-canada/services/drugs-health-products/medical-use-marijuana/licensed-producers/market-data.html
CANADIAN ACMPR MARKET DATA 2017/18
Dried Cannabis Sales CAD$ MExtract /Oil Sales CAD$ M
Dried Cannabis Sales Extract /Oil Sales
S TA T I S T I C S F R OM H EA L T H CANADA
PROB L EM
Cannabis extracts and extract -based products are in high demand but the highly
special ized equipment , production environments and expert ise required to make
these products are largely inaccessible , rudimentary and scarce ,
There are no establ ished standards for test ing , packaging or industr ial
manufacturing when i t comes to cannabis -based products ,
SO LU T I ONQuadron Cannatech provides high precis ion automated extract ion and processing
solut ions through ful ly integrated equipment , anci l lary products and services .
SPECIALIZED EQUIPMENTRESEARCH & DEVELOPMENT ANCILLIARY PRODUCTS & SERVICES
Vert ical ly Integrated for
continuous improvement of
our equipment , anci l lary
products and services
Scalable , turn -key
systems and laboratory
environments for cannabis
extract ion and processing
Customized and branded
end -user products that
complement our extract ion
and processing systems
CO2 EX TRAC T I ON E QU I PMENT
PLUG & PLAY DESIGNSet-up & train within hours
HIGH-CAPACITY 45L VESSEL
REMOTE MONITORING & CONTROLSoftware col lects , store & analyzes data
For large scale extract production
El imination of manual valves
AUTOMATED CONTROLS
Quadron 's 'BOSS CO2 Extraction System '
del ivers innovation in cannabis extract ion with
an exclusive "Plug & Play " design , proprietary
max f low technology and advanced
thermodynamics ,
1st BOSS machine sold Dec 2017 . 2 addit ional
sales in Jan 2018 : 1 in Canada and 1 in the U .S .A .
BOSS CO2 EXTRACTION SYSTEM FEATURES INCLUDE:
U .S . D I S TR I BU T I ON
In Nov 2017 , Quadron and Lucid Lab Group (LLG )
s igned a definit ive development and
distr ibution agreement . LLG i s a leading
cannabis equipment distr ibutor based out of
Washington State with extensive distr ibution
channels across the U .S .
Quadron and LLG wil l co -develop 4 new
extract ion and processing systems for
commercial release to the North American
cannabis market over the next 30 months .
LLG wil l become a preferred sales agent in the
Western U .S . for al l processing systems offered
by Quadron .
US Extracts & Oils Market:
Cannabis concentrate sales have grown f rom
$3 ,483 ,681 in 2014 to $143 ,282 ,686 in 2016 in
Washington State (Washington State Liquor &
Cannabis Board ) .
L UC I D LAB GROUP PARTNERSH I P
ANC I L LARY PRODUCTSThe concentrates market in Cal i fornia
generated $169M in sales in the second
quarter of 2017 alone . Vape pens accounted
for 61% or $103M of dollars sold .
Through the company 's products divis ion ,
Quadron provides anci l lary products such as
vape pens , vape cartr idges , inhalers , capsules ,
t inctures , edibles , etc .
Quadron provides branding services as well as a broad range of branded ancil lary products and consumption devices creating an end-to-end solution for authorized growers.
Quadron plans to expand into capsules and
suppositor ies market this year (2018 ) .
ANC I L LARY S ERV I C E SQuadron works with l icensed operators to
design and set -up laboratory environments
with the equipment and personnel required
for anci l lary product manufacturing and
extract production .
Quadron provides tai lor made service
contracts including faci l i ty design and
planning , laboratory set -up , and systems
implementation ,
Anci l lary service contracts are tai lored to each
cl ient ’s unique extract ion and processing
needs and end -product goals ( i .e . extract
products , vape pens , capsules , etc ) .
By working with Quadron ’s team of experts ,
cl ients have access to the company 's ful l suite
of equipment and services , enabl ing them to
penetrate the high margin cannabis oi ls
market .
MOB I L E EX TRAC T I ON E QU I PMENTQuadron has designed and manufactured ful ly
portable extract ion and processing labs to
service l icensed growers on -s ite .
Mobile units come in dif ferent modules to suite
the specif ic production needs of the cl ient .
Each module offers a turnkey , scaleable
control led -environment providing growers
access to automated extract ion systems and
increased margins .
On -s ite extract ion i s a lucrat ive niche market
al lowing Quadron to apply i ts diverse industry
knowledge and expert ise to quickly generate
high margin revenue .
Mobile units are currently undergoing the f inal
stages of test ing . Two mobile units are
anticipated in f ie ld Spring 2018 .
CYB ERNE T I C CONTRO L SYS T EMS I N C .Cybernetic i s Quadron ’s in -house engineering
and automation group , acquired in March 2017
Cybernetic provides Quadron with automation
and manufacturing expert ise for the design and
development of Quadron ’s l ine of cannabis
extract ion and processing equipment .
Cybernetic has a proven track record of
designing , fabricat ing and supplying custom and
standard machines bringing automation to the
process manufacturing and industr ial sectors .
Cybernetics awarded l icense to
be technical distr ibutor and integrator for
Schneider Electr ic , a global special ist in energy
management and automation .
September 2017,
Integrated industry solutions from green to gold
#greentogold
PACKAGING
CANNABIS
PROCESSING FORMULATIONEXTRACTIONCANNABIS PACKAGINGPROCESSINGEXTRACTIONCANNABISCANNA B I S P R O C E S S I N G E X T RA C T I O N F O RMU LA T I O N PA C KA G I N G
F ROM GRE EN TO GO LD
GROWTH& P ER FORMANCE
2017 revenue of $1 ,789 ,788 compared
to 2016 revenue of $166 ,823 .
2017 gross margin for the year of
$502 ,320 (28%).
Q1 2017 Revenue of $516 ,211 , a 131%
increase over Q1 July 31 , 2016 and a
243% increase over Q4 2016 .
Q2 ending Oct 31 , 2017 revenue
was $435 ,749 with a prof it margin
of 53%
Q C C R e v e n u e A v g . V o l 6 6 1 . 5 6 k ( 3 mon t h s )
QCC SHARE S TRUCTUR EIn January 2018 , Quadron Cannatech closed a $5 mill ion
dollar bought deal f inancing (at $ .70 per share ) .
MANAGEMENT
Chief Financial Off icer ,
Quadron Cannatech
Director , President & CEO ,
Quadron Cannatech
Director ,
Quadron Cannatech
Director ,
Quadron Cannatech
Director , Chair of the Board ,
Quadron Cannatech
Partner at Cassels
Brock & Blackwell LLP
in the Securit ies
Group with focus on
primari ly on
securit ies and
corporate f inance
matters .
Active in the public
market for more than
two decades , Mr .
Durno acts for i ssuers ,
investment dealers &
investment advisors
across a range of
industr ies .
Mr . Durno i s a
member of the TSX-V
List ing Advisory
Committee (BC ) .
President & CEO of
Emprise Capital
Corp . , a Vancouver
based merchant
banking company
Over 25 years of
experience in the
f inancial services &
capital markets
industr ies having
held senior executive
roles in var ious
capacit ies .
Experience with
public company
operations on a
number of publicly
traded and private
‘start -up ’ companies .
Over 23 years
experience in the
f inancial services &
capital markets
industr ies .
Extensive experience
with public company
operations with
regulatory
requirements ,
f inancial statements ,
rais ing capital , &
shareholder
relat ions .
BBA (Business Admin
special ized in
Finance ) , completion
of Canadian
Securit ies Course .
Over 30 years of
experience in
f inance and
administrat ion .
Currently CFO of
Emprise Capital
Corp . , a Vancouver
based merchant
bank and serves as
CFO and director for
a number of public
companies .
Professional
accountant holding
a designation f rom
the Cert i f ied
Management
Accountants of
Canada .
Over 16 years of
business ,
entrepreneurial and
legal experience
special iz ing in corporate
law and regulatory
affairs
Served as strategic
advisor and counsel in
the venture capital
space for well over a
decade .
Co- founder and
Executive Director of the
Cannabis Trade All iance
of Canada (CTAC ) , and
special advisory to the
Canadian Associat ion of
Medical Cannabis
Dispensaries (CAMCD ) .
Extensive experience in the cannabis industry with expertise in regulation and legislation , corporate &
securit ies law , f inance , biological engineering , mechanical engineering , and extraction technology .
Rosy Mondin Jeff Durno Scott Ackerman Doug McFaul Robert Chisholm
MANAGEMENT CONT .
Lead Chemist ,
Quadron Cannatech
Kieran Forristal
Founder ,
Soma Labs Scienti f ic
Founder ,
Cybernetic Control Systems
Lead Scientist ,
Soma Labs Scienti f ic
30 years of business
experience as an
innovator and
successful
entrepreneur .
CEO of Odorchem ,
manufacturer and
distr ibutor of ‘ONA ’
15 years ’ experience
working with
supercr it ical CO2 &
25 years ’ experience
in mechanical design
and systems
automation .
Over 20 years capital
market experience
working on the
capital market
trading f loors in top
ten international
Investment banks .
Worked at BNP
Paribas , Bank of
America and Union
Bank of Switzerland
Experience with
complex & structured
derivat ive process
control ,
management ,
eff ic ient operational
growth & regulatory
governance .
Extensive experience
in automation &
machine
development ,
uti l iz ing a combined
education in
electronics
engineering ,
chemistry &
business .
Co- founder of
Cybernetic Control
Systems
Mike holds a degree
as an A .Sc .T .
(Electronics
Engineering ) f rom
BCIT .
Chemical
engineering and
Green Chemistry
research special ist .
Extensive experience
in clean oi l
upgrading and CO2
extract ion systems
A background in
process optimization
and research
leadership ,
bioref inery chemistry
expert ise
BASc (UBC ) &10
years hands -on
experience in
chemical &
biological
engineering .
Developing new
technologies in the
waste to energy
(green energy )
sector .
3 years as lead
chemist for
Odorchem
President Soma Labs and
Greenmantle Products
Shane Lander Michael MacDonald Greg Curtis Peter Hausmanis
In -house engineering ,
manufacturing and science -related
technology experience gives
Quadron a leading edge
G R OW I N G CANAD IAN MA RK E T
Cannabis oi l consumption
expected to grow f rom 284L
in 2015 to 562 ,613L in Canada
by 2020 (198 ,000% growth )
L EAD I N G I N I N N O VA T I O N
The BOSS CO2 Extractor
i s a ful ly automated system
that al lows growers to use
programmed cycles to
produce the highest
qual ity oi ls
O R GAN I C R E V E N U E G R OWTH
Revenues grew to $1 ,789 ,188
in 2017 f rom 2016 revenues
of $166 ,823
D I S T R I B U T I O N PA R TN E R S H I P S
Q UADR ON ’ S AD VAN TA G E
P R O V E N MANA G EM EN T T EAM
Extensive experience in the
cannabis industry with expert ise
in regulat ion and legis lat ion , law ,
f inance , biological engineering ,
mechanical engineering , and
extract ion technology .
Quadron has announced a
definit ive development &
distr ibution agreement with Lucid
Lab Group to sel l equipment
in the Western USA
I N V E S TMENT H I GH L I GH TS
Director, President & CEO
1.604.346.8118
Investor Relations Representative
1.604.684.6730 | 1.866.684.6730
1600 - 609 Granville St.
Vancouver, BC | V7Y 1C3
www.quadroncannatech.com
Quadron Cannatech Corporation
Caleb Jeffries
Rosy Mondin
CSE:QCC