Original-Research: Agrios Global Holdings Ltd. - von GBC AG

Einstufung von GBC AG zu Agrios Global Holdings Ltd.

Unternehmen: Agrios Global Holdings Ltd.
ISIN: CA00856K1003

Anlass der Studie: Management Interview
Letzte Ratingänderung: -
Analyst: Matthias Greiffenberger, Julien Desrosiers

Interview with Agrios Global Holdings Ltd.

GBC AG: Could you please describe the business model of Agrios Global
Holdings (Agrios) and what makes it so unique?

Chris Kennedy: Our business model is based on providing a comprehensive
suite of services to licensed cannabis producers. What makes Agrios so
unique is that we have focused on advancing the innovation in indoor
growing science and have built a data driven agriculture technology
platform that allows us to establish and control optimal growing conditions
to maximize yield and produce consistent product. Today, one of the biggest
challenges for growers is producing consistent product due to the number of
variables that can influence a crops outcome. Agrios’ facility is 100% bio
and environmentally controlled, so we are able to replicate exact growing
conditions throughout the cultivation process to produce high-quality
consistent product.

GBC AG: Tell us more about your data driven approach?

Chris Kennedy: Agrios is collecting 100's of millions of data points
throughout the cultivation process on a per strain basis. Sixteen
environmental data points every two seconds, such as - Air temp, humidity
levels, water temp, atmospheric pressure, etc. In addition, we collect
nutrient levels and dosing data points, conduct water reservoir analysis to
measure each strain’s nutrient requirements, take tissue samples and do
genetic cannabinoid profile testing. Combined, the data we are collecting
give us a comprehensive view of the plant. The data gives us real-time
insights allowing us to make adjustments during the cultivation process if
necessary, but more importantly provides us the information to correlate
variable impacts to outcomes. Since we are able to control 100% of the
variables throughout the cultivation process, we can begin to manipulate
environmental variables to produce different outcomes. As we collect more
data and continue to research impacts of intentionally introduced plant
stressors, we can begin to identify the levers to influence a strains
cannabinoid profile.

GBC AG: How do you see the current market that you operate in and what kind
of changes do you expect? How is the legal environment?

Chris Kennedy: Washington State is an evolving market projected to reach
$2.28 billion by 2020. Washington is considered to be a mature market which
provides a stable regulatory environment, unlike new US markets which tend
to be more volatile due to constant regulatory updates and rule changes.
Washington is an extremely competitive market and over production has led
to significant price compression, making it difficult for groups that are
not operationally and cost efficient to survive. We have seen massive
consolidation in the market and prices are starting to rebound as a result.
There is a good opportunity for a low-cost producer of high quality
consistent product.

We can expect increased compliance, government involvement and evolving
regulations. I feel our management team’s background in heavily regulated
sectors influenced our approach in raising the industry standard from the
beginning. We are well positioned for the changes to come as the market
continues to develop.

From a State level the legal environment is very stable and the industry is
developing rapidly. From a federal level, there is a lot of momentum
towards the legalization effort, especially on the medical side.

GBC AG: How do you see the company positioned in two years?

Chris Kennedy: In two years, Agrios will be a multi-state operator with a
product portfolio and branding strategy to capitalize on both recreational
and medical cannabis markets. Our brands will be known for providing a
reliable experience due to our ability to replicate environments and
growing conditions to grow consistent product. We will have a profitable
model in Washington and will have built out our next gen facility in a new
market with an emphasis on R&D setting the stage for us to broaden the
profile of the company.

GBC AG: What is your vision for the next five years and in the long run?

Chris Kennedy: We believe that the platform we have built and the progress
we have made on producing consistent product puts us in a very unique
position to establish national brands. At the core, we will continue to
focus on advancing the innovation in indoor growing, data science and
automation. The real value in our approach is how fast we are able to learn
because all variables are controlled, the data we collect and our ability
to make real-time adjustments throughout the cultivation process.

We will begin to focus more on the medical cannabis sector due to our
ability to produce consistent product. Recent research is suggesting that
some strains are more effective than others in treating specific
conditions, but it has to do with the total cannabinoid profile of the
flower and the entourage effect of those cannabinoids. If a patient has
success with a particular harvest, it is extremely important to be able to
reproduce that product. Our ability to replicate the growing environment
and conditions allows us to produce consistent product from one harvest to
the next. We look to establish a full brand portfolio of medical products
that offers a reliable consistent experience.

As we build out our next gen facility we will also begin R&D efforts and
explore opportunities associated with other crops. With environmental
variables constantly changing or not being available it is becoming more
challenging to establish consistent food supply. We want to be part of the
solution to this challenge.

GBC AG: Mr. Kennedy, thank you for the discussion.

Die vollständige Analyse können Sie hier downloaden:

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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG und Art. 20 MAR Beim oben analysierten Unternehmen ist folgender möglicher Interessenkonflikt gegeben: (5a,5b,11); Einen Katalog möglicher Interessenkonflikte finden Sie unter:
Datum und Zeitpunkt der Fertigstellung der Studie: 03.07.2019 (15:00 Uhr)
Datum und Zeitpunkt der ersten Weitergabe: 08.07.2019 (09:00 Uhr)

-------------------übermittelt durch die EQS Group AG.-------------------

Für den Inhalt der Mitteilung bzw. Research ist alleine der Herausgeber bzw.
Ersteller der Studie verantwortlich. Diese Meldung ist keine Anlageberatung
oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.

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