OrganiGram Holdings Inc (OTCMKTS:OGRMF) shares have pulled back to test key support at the stock’s major long-term moving average, but still well above its pivot summertime lows. The trend remains sloped higher into the teeth of this recent volatility. To help assuage the pressure, the company just announced that it has signed a supply agreement with the Province of British Columbia.
As noted in its presser, the company has signed an agreement with the BC Liquor Distribution Branch (BCLDB), the sole, wholesale distributor of non-medical cannabis for the province that will operate standalone, public retail stores and provide online sales. The upshot is the sense that Organigram is now a coast-to-coast player.
OrganiGram Holdings Inc (OTCMKTS:OGRMF) is a TSX Venture Exchange listed company whose wholly owned subsidiary, OrganiGram Inc., is a licensed producer of medical marijuana in Canada.
OrganiGram is focused on producing the highest quality, condition-specific medical marijuana for patients in Canada. OGRMF’s facility is located in Moncton, New Brunswick and the Company is regulated by the Access to Cannabis for Medical Purposes Regulations.
The company’s own portrayal of its market positioning runs as follows: “From the day we started back in 2013, it’s been about making lives better – for our clients, our people, and our community. We’re based in Moncton, New Brunswick, the heart of the Maritimes, but at OrganiGram Holdings we’re committed to improving the quality of life for Canadians across the country. For us, this means working with health-care providers and industry organizations, supporting research and education, and providing a safe, effective product.”
“To be effective in that last goal, we made a decision to produce organic cannabis. Growing certified organic medical cannabis isn’t easy, in fact, most licensed producers won’t take this on. It means more care, more testing, more rules… but in the end, it means a product that we feel delivers on our goals in the best way. And improving the quality of life for Canadians is not just about getting safe, quality product to them effectively. It’s about creating jobs, being good neighbors and contributing to our community.”
Coast to Coast
As noted above, OGRMF just came forward with news that the company has signed a supply agreement with the Province of British Columbia to take its geographic exposure to a full coast-to-coast status. The announcement has helped to pare recent pressure in the stock, with shares now up about 12% in the past week.
“Organigram’s strategic vision has always been to establish a definitive national footprint,” says Greg Engel, Organigram’s Chief Executive Officer. “We are proud to realize that vision and offer Canadians from coast to coast access to our growing recreational product portfolio.”
Over the past month, shares of the stock have suffered from clear selling pressure, dropping by roughly -21%. But support appears to be establishing itself in the past week.
“We are excited to work with partners across the country, now including the Province of British Columbia to help ensure the success of new adult-use recreational cannabis markets in each of these regions,” says Tim Emberg, Vice President of Sales and Commercial Operations, Organigram.
OrganiGram Holdings Inc (OTCMKTS:OGRMF) generated sales of $3.7M, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of just 1% on the top line.
In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($155.8M against $9.1M).
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