Bhang Inc (OTCMKTS:BHNGF) posted a gross profit of $1.243 million in Q1 2020. It derived 90% of its earnings from license revenues in Q1 2020. The company reduced marketing and sales expenses by 46.18% YoY to $153,013 during this quarter. It scaled back certain operations and focused only on key growth areas to preserve capital.
Bhang terminated an accord with its previous licensee and acquired the brand operations in California. The company introduced a refreshing and innovative packaging in California. This initiative helped the company to post better than expected revenues in Q1 2020.
In Florida, Bhang uses a top-tier licensee to produce and distribute chocolates under the Bhang brand in 48 retail locations. The company expects to increase retail locations to 64 by the end of 2020. It will also introduce a home delivery service statewide. In Florida, edibles are legalized for sale.
A licensee of Bhang is having a presence in 72 delivery and retail stores across Nevada. The company expects to make available its chocolates in all the shelves in Nevada by the end of Q2 2020.
New Mexico operations
Bhang will unveil chocolates in new packaging in Q3 2020. It is optimistic that voters in New Mexico will support the legalization of adult-use cannabis soon.
Bhang’s licensee engages in the production and sale of chocolates under the Bhang brand monthly in Illinois. Its licensee expanded its operations to improve sales this year and beyond.
Bhang amends license agreement with Indiva
Bhang signed an amended license accord with Indiva Ltd (OTCMKTS: NDVAF). The new agreement replaces accord entered in 2018 related to JV between the two companies. As per the terms of the new deal, Bhang will receive royalty payments on the production and sale of its THC infused products exclusively by Indiva in Canada. Indiva can also export Bhang Chocolates infused with THC to satisfy demand in the overseas markets.
CEO of Indiva, Niel Marotta, said the company is excited to sign an amended accord with Bhang to continue the manufacture and sale of cannabis-infused Bhang Chocolates.
Bhang reached a settlement agreement with Cannabis Growth Opportunity Corp (OTCMKTS:CWWBF). As per the terms of the settlement, the company will issue 6.66 million subordinate voting shares to Cannabis Growth.