Halo Labs Provides Oregon Business Update Company Projects Record September Sales Orders in Oregon
Halo Labs Inc. ("Halo" or the "Company") (NEO: HALO, OTCQX: AGEEF, Germany: A9KN) announces that in September, its Oregon business unit (“ANM”) will have a record level of monthly sales orders totaling approximately $1.8 million (all figures are USD unless stated otherwise), driven by estimated vape cartridge sales of $539,000. Halo believes that this spike in sales orders partially originates from consumers stockpiling vape products in case a ban is imposed by Oregon. Not all of these orders will be filled in September. Actual revenue will be lower than $1.8 million in September in Oregon and is estimated to be $1.4 million. As previously reported, for the first six months ended June 30, 2019, average unaudited monthly revenues in Oregon were $948,579. Most of the shortfall between sales orders and revenue should be recognized as revenue when shipments are made in October. Halo believes it has sufficient inventory on hand in Oregon to fulfill this level of orders should it continue.
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In addition, Halo expects a record harvest on the six-acre outdoor Evans Creek grow site of approximately 15,000 pounds (6,800 Kilos) of dry weight, usable cannabis as a result of favorable climate conditions throughout the Emerald Triangle. Given the uncertainty surrounding the vaporizer market in Oregon, the Company plans to dedicate 7,500 pounds (3,400 kilos) of the harvest to flower sales. Halo has received deposits of $600,000 for 2,400 pounds on flower sales at an average price per pound of $500. The Company expects incremental sales from flower over the next 4 months of approximately $1 million per month at an estimated gross margin of 60%. These sales will help offset revenue losses from any potential ban or restrictions on vape cartridge sales imposed by the state of Oregon. And if a ban is not imposed, the Company would anticipate sales in Oregon to continue to rise.
In addition, Halo has launched a direct marketing campaign to every licensed dispensary in Oregon, highlighting the benefits of the DabTabsTM product line over conventional vape cartridges. The Company is planning to launch a similar campaign to California dispensaries in the next two weeks.
Currently, Halo has approximately 80,000 grams of natural live resin in stock at its Medford, Oregon facility and has contracted with NectarTM for approximately $1 million of fresh cannabis material which will be converted into live resin over the next three months. The concentrate business is approximately 40% of the Company’s overall Oregon revenues year to date. Halo believes it’s one of the largest suppliers, if not the largest supplier, of concentrates to dispensaries in Oregon based on data obtained from BDS Analytics and state records. The Company does not expect dabs and the DabTabsTM product line to be affected by any potential bans imposed by the State of Oregon on vaporizers or vaping products.