Canadian marijuana company Tweed Marijuana is riding high after posting its first profitable quarter and agreeing a friendly merger with Bedrocan Cannabis Corporation.
The Ontario-based parent company of medicinal marijuana producers announced revenue of $1.7m (£1.1m) in the three months to 30 June - a 39 per cent quarterly increase - which helped the group reach a net income of $1m.
This time last year, the group posted a net loss of the $1.2m.
The turnaround was ignited by sales amounting to 215,929 grams at an average price of $7.74 per gram - up from an average price of $7.25 and 26,205 grams sold a year ago - as well as restrained growth in research and development costs.
Why it's interesting
Tweed today announced it had finalised a deal to fully acquire Canadian marijuana research and producer Bedrocan Cannabis Corporation, a merger it says will transform it into the "leading player" in the industry.
Canada legalised marijuana for medicinal use in April, following the example of 19 other US states with similar laws - not to mention the four where the drug is also legal for recreational purposes.
The new company is aiming to expand upon its combined 5,600 active registered customers with a broader product range.
Canadian medicinal marijuana companies offer potential investors clarity when it comes to how their investments will be affected by different rules and regulations - a luxury not afforded in the US where laws vary wildly between different states.
What Tweed said
We have established the clear market leader, and are driving the evolution of the cannabis sector in Canada. The acquisition of Bedrocan is the first step, and we intend to continue to take the initiative, growing our portfolio of brands, expanding clinical research on cannabis, adding new products and services, and introducing additional innovations for patients and consumers.
- Tweed chairman and chief executive Bruce Linton.