Chemesis (CSI.C) can now grow & process hemp in the USA

If you’ve been a parent of a teenager, you’ve watched in amazement as the gangly youngster grows new limbs overnight.

So it is with Chemesis International (CSI.C).

“Little Puerto Rico?” asked Chris Parry rhetorically in Equity Guru’s 1^st article, “Who cares?”

The company – born a year ago – hit puberty while it was still latched onto its mother’s breast.

On June 20, 2019 CSI announced that it has received a Hemp Cultivation & Processing Licenses in the state of Michigan.

Chemesis now has 4 main branches of operation:

• Cultivation:  Hemp cultivation in Michigan, grow facility in Puerto Rico with 30,000+ lb overall grow capacity. Grow opportunities currently under review in California. Also, a 1,000-acre Colombian grow facility in development.
• Manufacturing: extractions, formulations & products, specializing in BHO, Alcohol & CO2 extraction with the current capacity of over 2000 lbs of raw material a day.
• Distribution: With new regulations impacting the California market, Desert Zen has emerged as a fully compliant first mover.  In Puerto Rico market, CSI serves the entire island from seed to sale.
  Retail:  Chemesis distributes and transports California Sap, Jay and Silent Bob’s Private Stash and 3^rd-party brands to over 600 dispensaries in California and Puerto Rico.

On November 6, 2018, Michigan passed a Regulation and Taxation of Marijuana Act which created a legal framework for the regulation, licensing, and enforcement of medical and recreational cannabis.

With the Michigan licenses in hand, CSI plans to begin planting hemp in the next few weeks. The June 20, 2019 news advances Chemesis’ long term objective of becoming “a major cannabis multi-state operator.”

Chemesis now has US operations in California, Arizona, Puerto Rico and Michigan. The long term growth strategy is to target other U.S. states with favourable regulations and assets that compliment CSI’s philosophy and skill-set

In a May 27, 2019 podcast, Edgar Montero, the CEO of Chemesis, spoke with Equity.Guru’s Guy Bennett about the personal catalyst that propelled him into the cannabis industry, and how CSI cross-pollinates innovation between its international operations.

On Christmas Eve, 2018 CSI was trading at .86.  The stock rose fast to $2.25 on March 8, 2019 – then dropped $1.55 on June 10, 2019.  Since then (the last two weeks), it’s up about 25%, including 15% in the last 5 days.

Three weeks ago, CSI announced unaudited Q3 Financials for the 3-months ending March 31, 2019.

Q3 Chemesis Fiscal Highlights:

• Revenue of $3.7 million, a 33% increase over the previous quarter
• Gross Profit of $1.1 million.
• Closed the acquisition of La Finca, an integrated Colombian cannabis company with access to over 1,060 acres of outdoor cultivation.
• Signed agreement to manufacture a Proprietary Patent Pending THC Flake.
• Partnership with First Medical Cannabis bringing immediate access to 1,000 acres of hemp cultivation in Puerto Rico- with option to expand to an additional 5,000 acres.

“CSI’s operations continue to see increases in revenue quarter over quarter and we anticipate our operations will continue to grow as we see significant demand for the products we manufacture and package,” stated Montero.

Chemesis international has access to $32.6 million in drawdown equity facilities between New York based Alumina Partners Inc and Global Emerging Markets at the company’s discretion.

CSI’s branded products have attracted an endorsement/collaboration with filmmaker Kevin Smith and “Silent Bob”.

This is like getting your abs endorsed by Zach Efron.

Chris Parry considers Kevin Smith “One of the top three best endorsement targets (for a cannabis company) in the world today.”

Smith has a monster following of pot-heads.

“@jayandsilentbob used to sell weed in the movies,” wrote Mr. Smith in recent Instagram post, “Now, thanks to the good folks at @chemesis.tv , Jay and Silent Bob are selling weed in real life!”

“We are pleased to have received a Hemp Cultivation License for the state of Michigan,” stated Montero. “Michigan is a large cannabis market and the Company believes building a major footprint in the state will not only increase revenues and long-term growth, but bring even bigger opportunities across the United States.

CSI is currently evaluating assets and apply for licenses in the previously announced states of Wisconsin, Illinois, Missouri, and Michigan.

Grow baby, grow.

Full Disclosure: Chemesis is an Equity Guru marketing client, and we own the stock.