On the 1-year anniversary of the first cannabis company to list on the London Stock Exchange, we examine the reaction to a number of significant announcements from some of the UK’s biggest cannabis players, making for an eventful week in the markets.
Love Hemp Group, which is listed on the Aquis Stock Exchange, was one of the best performing stocks last week, seeing a 60% jump in its share price to 1.23p.
While this remains considerably below last February’s highs of over 8p, it represents its highest price since December.
In what one investor described as a ‘game changing’ RNS issued on Wednesday, Love Hemp announced that Garry Cook and Graham Mullis will be joining the Board of Love Hemp as Non-Executive Directors from 14 February 2022.
It said that these appointments were being made to strengthen its ‘corporate positioning and governance’ ahead of its move onto the LSE.
In a separate release, Love Hemp announced its intention to raise up to £2.0 million by way of a placing, while stating it remained on track to list on the LSE in Q1 this year.
OCT also enjoyed gains of around 7% last week, hitting highs of 2.6p midweek after announcing a number of boardroom changes on Monday.
After a tumultuous few months and the departure of a number of senior board members, OCT announced the appointment of Imperial Brands’ Director Richard Guy Hathaway.
OCT says Mr Hathaway’s ‘extensive financial and corporate experience will be of great benefit to the company’.
Investors seemed to react favourably to the news, alongside the announcement that Julie Pomeroy, currently an independent Non-Executive Director, will replace Neil Mahapatra as the role of Non-Executive Chair from 11 February 2022
Mr Mahapatra agreed to step down from his position as OCT Executive Chairman in the wake of an ill-fated deal between his company Kingsley Capital Partners (KCP) and merchant bank Brown Shipley, which breached market rules, and subsequently sent OCT’s shares into freefall.
While Cellular Goods’ stock performance was relatively flat throughout the week, slumping just under 3%, some investors have begun calling for an update on the company’s upcoming ‘omni-channel marketing campaign’.
In December Cellular Goods launched its inaugural product range of ‘lab-made cannabinoid’ products through its own ecommerce platform, but investors took issue with the apparent lack of marketing in order to push early sales.
This was addressed in a separate update in promising a ‘comprehensive’ campaign will commence in February 2022, a month it says beauty and wellness products often sell best.
Last week it released a white-paper into the ability of CBD and CBD to prevent signs of aging on the skin.
Some had hoped this white-paper marked the commencement of the promised marketing campaign, but any further updates are yet to emerge.
One of the worst performers this week was Chill Brands which saw its share price fall 33% last week in the wake of its most recent financial update.
Aside from its operating losses jumping 150% in the six months to September 30th to £2.5m, Chill also announced that it was shifting its strategy away from a reliance on physical store sales and towards a broader, omni-channel approach.
The company’s newly appointed sales and marketing director Michael Sandore says that the company will scrap its current timeline for rolling its CBD tobacco replacement product out to some 88,000 stores across the US as part of a distribution deal with The Asian American Trade Association (AATAC).
This deal was seen by many as a key driver of growth for Chill Brands and it has been watched closely by investors since its announcement, but the roll out has been delayed numerous times due to COVID-related logistics issues.
Last week saw MGC’s stock drop from £0.0171 to lows of £0.147, before recovering to £0.0157 throughout the rest of the week.
The initial 14% drop came after the company posted seemingly positive quarterly sales figures, reporting its highest ever quarterly revenues.
Despite the strong sales, MGC said that trials for Cognicann, a product designed to treat patients with Dementia and Alzheimer’s have been pushed back by at least six months due to COVID-related delays.
Meanwhile slow progress on the Emergency Use Approval of its COVID treatment CimetrA in India, expected to provide a huge boon to its finances, gave little for investors to run with.
Later in the week MGC issued an RNS informing investors that Nadya Lisovoder, its Chief Medical Officer, had sold a total of 22m shares in three separate transactions for a total of $1.2m AUD.
While this raised eyebrows for a number of investors, the sell off was related to MGC’s acquisition of Ms Lisovoder’s company MediCaNL in May 2021, requiring her to sell a portion of her vendor consideration shares in order to satisfy personal capital gains tax liabilities.