1st QTR Financial Performance Executive Summary
Puration, Inc. (“PURA”) has released its first quarter financial report for the period ended March 31, 2017. The report includes the Company’s first revenue generated by the Company’s patented cannabis extraction process. The Company had no revenue to report in the first quarter of 2016. Revenue in the first quarter of 2017 was $84,000. More importantly, the gross profit was $63,000, a gross margin of 75%. The revenue comes from the first of three anticipated beverage contracts where PURA extract is infused into a beverage. The first beverage produced with PURA extract is EVERx CBD Infused Sports Water. The Company anticipates announcing major EVERx distribution contracts in the near future. PURA expects to be in production with Spanish Peaks ScrumpDelicacies and AmeriCanna Cafe shortly. Management remains confident that the three beverage contracts will see the Company realize its $3 million annual revenue goal. With gross margins of 75%, increasing revenues can put the Company in a position to self-fund future growth.
Patented Cannabis Extraction Process
PURA recently entered into an agreement with NCM Biotech, Inc. that was a substantial upgrade to the two Companies previous joint venture agreement. NCM Biotech has licensed to PURA the right to utilize NCM Biotech’s patented cannabis extraction process to produce cannabis extracts for infusion into recreational, fitness, wellness, alternative medicine and beauty products. NCM Biotech exclusively owns U.S. Patent No. 9,199,960 entitled “METHOD AND APPARATUS FOR PROCESSING HERBACEOUS PLANT MATERIALS INCLUDING THE CANNABIS PLANT.” The license of the process to PURA is the first and only license NCM Biotech has executed.
NCM and PURA are combining efforts to build a state of the art extraction lab where the patented process can be further refined and tested not just improving the quality of PURA’s extracts for recreational, fitness, wellness, alternative medicine and beauty product uses, but also for pharmaceutical applications. Management anticipates making an important announcement soon.
American Cannabis Innovations Conglomerated
The Company recently announced the pending roll-up of PURA into a private holding company called American Cannabis Innovations Conglomerated (“ACI”). While the majority control of PURA will be held by ACI, PURA common stock will continue to be listed and trade on the OTC Markets. The transaction between PURA and ACI does not change PURA shareholders ability to buy and sell stock. Furthermore, there is no plan to reverse split the stock of PURA as part of the ACI transaction. On the contrary, management believes the ACI transaction can improve the quality of investment capital and the overall operating efficiency of the Company and in so doing actually enhance the value of PURA common stock.
EVERx, Spanish Peaks ScrumpDelicacies and AmeriCanna Cafe
PURA has recently submitted a second order to its co-packing partner Alkame Holdings, Inc. (USOTC: ALKM) to replenish its inventory of EVERx CBD Infused Sports Water. PURA has also recently announced the first of three EVERx CBD Infused Flavored Sports Waters. The first of the three flavors is EVERx CBD Infused Citrus Cooler Flavored Sports Water. A number of major brand name distribution agreements for EVERx are in the works and anticipated to be announced soon.
The first Spanish Peaks beverages are coming very soon. Additionally, Spanish Peaks has struck a deal with a public company and expects to complete a reverse merger very soon. Part of the business agreement with PURA includes the dividend issuance of Spanish Peaks stock to PURA shareholders.
PURA and USMJ are sister companies and soon both with be part of ACI. In the meantime, USMJ is finalizing the launch of its own AmeriCanna Cafe CBD Infused Bottled Water which will include PURA CBD extract.
PURA has published a target $3 million annual revenue forecast based on the fulfilling three anticipated cannabis infused beverage contracts. PURA has secured the three contracts, begun executing on the first, and started realizing sales from the first. Management remains confident in the target $3 million revenue forecast.