W_vdm
2 년 전
Matt Armstrong shared a video on Instagram yesterday. You might need to follow him first before you can see it. It's a video of the working Cryomass system and the output of the process. Matt is one of the inventors of the process and is director of innovation at Cryomass.
Link to his account: https://www.instagram.com/strait_concentrates/
The text he added to the video:
"History in the making is right and this is just the tip of the iceberg!!! Hats off to the entire team and everyone who believed in us all over the years! It’s indescribable the feeling I felt when we turned on and fed the first fresh frozen through the system and she ran perfectly!! As with all things in life, plenty to tinker and play with to continue to maximize efficiency and quality, but that being said we hit the mark!!!! If you think this party starts and stop in the cannabis world, buckle up because it’s going to be a wild ride!! Next up, after we destroy the hops game(low hanging fruit) is time to start working to reclaim the land we’ve destroyed as a species and correcting centuries of mistakes! This technology reaches far and wide!! What we can affect and accomplish is limitless and only bound by the mind!!! Last but never least, too my amazing wife @mermaidmedibles and all 5 littles, thank you for allowing me the freedom to follow my path no matter where it has led me!! Weeks, months, even a year away, and nothing but support and strength!! Without you I would be nothing!! Cheers!!!"
W_vdm
2 년 전
Thanks for reminding me, I'm not that active on this forum.
I had a call with the Jérémy St-Pierre, responsible for investor relations at the company. These are the notes I took from the call (not in a particular order of importance):
This is translated from a communication I sent to several people in Dutch, so sometimes extra context is added as some of the target audience aren't that familiar with the company.
1. With the first license contract, they receive $850k per machine. Note that they do not sell the machine, Cryomass remains the owner, and the license fee is for the use of the machine. In addition, Cryomass also receives 50% of the net revenue from the machine (Revenue - Operating costs (1 to 2 personnel & cost of liquid nitrogen)).
2. The $850k is not a fixed price. This may be higher if the partner wants exclusivity in a certain region. This may be lower if it is commercially interesting for Cryomass. RedTape (partner taking the first license) received a discount as they are the first partner. The price can also vary depending on the type of plant for which it is applied. For crops with higher margins, higher prices can be charged.
3. Production of systems is not done by themselves, but by a partner company. The production process itself is not so complicated, so they are not dependent on one partner. They are looking for diversification in this to be able to produce faster and be less dependent on one company. The cost price of 1 installation was estimated to be around $500k. So the current license fee is enough to finance machines up front without Cryomass having to take on debt or dilute their shares.
4. They have patents in the USA/Canada until 2039 for their concept/process. So even if it is easy to replicate, no one can use it without their approval. Patent applications in other relevant countries have been filed/are in the process of approval.
5. The first system is available at their partner in California and also serves as a showcase model/proof of concept for the market. There is interest not only from the cannabis/hemp industry but also from other crops (such as hops for beer brewing). They have received many requests to see their machine and partnership requests. There is no immediate need to set up a sales team as there is a lot of "organic" interest.
6. They are making a few adjustments (fine-tuning) to their current machine concept. They are of course learning as they go from practice. The estimate was that the second, adjusted machine could be delivered by May. From then on, they would be able to deliver more and more quickly. The bulk of the hemp/cannabis harvest season is in September, (cr)optober, November. By then, they want to have delivered 4 machines already.
7. The expectation is that royalty revenues will be many times greater than the upfront license fees. The exact estimate could not be given (not publicly disclosed), but it strongly depends on a good partner (who ensures uptime of their machine). Next quarter reporting will provide more clarity on this. Q1 report may be a catalyst for share price (10-k was released end of March last year).
8. Keep in mind that the USA is a growing market that currently has around $5.5 billion in wholesale revenue (in which they are active). 50% of the market is for the plant, 50% for the trichomes/active ingredients. That is still a market of $2.75 billion. Only for the USA, only for Hemp.
9. They have no competition in their technology (shielded by patents). Other technologies try to separate based on water, which has considerably higher costs and cannot process as large quantities as CryoMass.
10. They are already considering on developing new machines before and after the Cryo process. For example, making sure the machine can easily be taken to the field. The faster the plant is frozen, the more valuable trichomes remain intact. They are also looking at separators that will freeze less biomass (without trichomes).
11. They are considering an uplisting to a larger stock exchange. This will not happen/be announced before the fall of 2023 at the earliest. First, they want to show a few quarters of revenue + revenue growth and let the share price grow organically.
12. So far, they have never engaged in marketing, and it was not really necessary. To sell their product, they will not do this for the time being because they are receiving a lot of interest from their target sector and even beyond. They have many requests for partnerships, which limits sales/marketing costs. However, they will start to generate more publicity around the stock. Within a month or two, there will be more frequent updates on their progress, as well as the company's participation in conferences or maybe even an investor day. The exact format is not yet known, but it is clear that they will focus extra attention on this. It is still flying under the radar, but maybe not for much longer.
13. Shareholders: the largest is CRYM Co-Invest LP (11%). This is a fund set up by investment professionals from the real estate world in Vancouver who are connected through CEO (Christian Noel). The second-largest shareholder is CryoCann USA Corporation (4.9%), which is the vehicle of the inventors of the cryo technology. These are engineering profiles who used their resources to initially develop the technology. They needed more resources & commercial skills bring the commercialization in motion. By setting up Cryomass, a collaboration was established in which the product could be further developed and commercialization could be accelerated. Matt Armstrong, one of the inventors & shareholders of CryoCann USA corporation, is still the Director of Innovation today. The third-largest shareholder is the CEO himself (4.52%).
14. $251k in stocks were bought by insiders in January (by CEO, CFO & head of legal)
15. The CEO's interest is the same as that of the shareholder. He owns 4.5% of the shares and continues to buy more. The largest shareholder are his finance/real estate friends from Vancouver.
W_vdm
2 년 전
Great news from earlier this week: https://cryomass.com/2023/01/cryomass-signs-10-2-million-multi-state-license-agreement/
"Under the terms of a multi-state license agreement, RedTape agreed on the terms to license the patented process and deploy 12 Trichome Separation systems for a total upfront investment of US$10.2 million payable in installments to CryoMass throughout 2023. CryoMass has agreed to deliver the units to RedTape according to a schedule that extends over 24 months. In addition to the installments, RedTape will pay CryoMass 50% of all net revenue generated by the units over the life of the agreement."
First income achieved! $10,2m revenue for the sale of 12 systems and a 50% "royalty" on the revenue generated by these systems.
Bring me to following questions (I'll ask these to management & posts replies here):
1. Sale price per system is $850.000. At what cost can they produce the system? I.e. What will the margins be on a system sale basis?
2. What are the running costs for the deployed systems and who carries them? Installed machinery requires periodic maintenance. When they break down (which will happen at some point), spare parts will be necessary. Is it the customer that carries the cost or CryoMass?
3. What will the revenue be from a single system? Is there an estimation that could let us allow to estimate revenues for Cryomass?
4. What is certainty regarding the revenue? How big is the deviation in yield between a good harvest and a bad harvest?
5. Is there insight in deployment schedule over the next 12 months? Will help to estimate cash flow timing.
The company will need to evolve from a proof of concept towards an enterprise that has a growing production capacity, that can provide maintenance in the field (service agreements opportunity?) and needs to develop further business opportunities (e.g. dealership agreements in other states). When they branch out to other crops, its realistic their R&D division will need to grow as well. Other plants might require specific changes in the process? Many challenges ahead, but a very interesting story!
FollowMyNIL
3 년 전
CryoMass Will Evolutionize The Cannabis Industry. READ
Welcome to the future of cannabis. You’re in CryoMass territory.
CryoMass Technologies Inc. is developing high- speed processing equipment that can be trucked to any field where commercial hemp or cannabis is being harvested. What the truck delivers is a precision disassembly line for plants. Because the CryoMass system is built to work on site, plants can be fed into it within minutes after cutting – leaving virtually zero time for trichomes to bleed out.
For all the advantages their equipment delivers,
a Cryomass system (based on the company’s patented process for liquid nitrogen separation)
is not expensive for the company to build – under $1 million. But the benefits to a cannabis grower lower costs, more product, higher quality -- are worth more than $1 million ... per week.
CryoMass technology eliminates a long list of labor, capital and other costs, including the costs of:
•Owning a drying house and all the equipment needed to control temperature and humidity
•Owning trucks to bring plants to the drying house
•Loading plants for shipment to the drying house (and then unloading them)
•Handling and monitoring plants at the drying house
•Trimming buds by hand or machine
•Truck fuel
•Electricity to keep the drying house running at the right temperature and humidity
Cryomass technology yields more product, because it captures all the good stuff that nature put in
the trichomes – instead of losing one-third to evaporation.
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