Terra Tech Corp (OTCMKTS:TRTC) took flight to start the new year on news of the company’s temporary permit to sell recreational pot in California. For those not familiar with the terms of this arrangement, we wanted to highlight the salient points to clear up any confusion.
As noted in the company’s release, the state of California Temporary Authorization to conduct medical and adult cannabis retail sales, manufacturing, cultivation and distribution will be valid for 120 days and may be extended for an additional 90 days. This transition period, from January 1, 2018 through July 1, 2018, allows for existing operators to apply for their annual permits and affords the industry an opportunity to align all business operations with new state requirements. During this time period existing operators with local approval are authorized to retail the inventory on hand as of December 31, 2017, so long as it is appropriately labeled and in controlled packaging. Terra Tech is required to submit further information and documents related to each of its respective business entities to the State of California in order to secure annual adult-use and medical licenses, including but not limited to incorporation documents, business operational plans, financial information, and leadership/executive information, labor peace agreements for operations with more than 20 employees, along with proof of local approval to operate.
Terra Tech Corp (OTCMKTS:TRTC) has positioned itself in the cannabis space as a company that engages in the design, marketing, and sale of hydroponic equipment with proprietary technology to create sustainable solutions for the cultivation of indoor agriculture in Newport Beach and Irvine, California.
TRTC operates through two segments, Hydroponic Produce and Cannabis Products. The company offers environmental controllers and timers; ballasts; bulbs; reflectors; nutrients; and portable hydroponic trailers and The Big Bud and Little Bud, which are custom fabricated proprietary cultivation systems for horticulture enthusiasts, local urban farmers, and greenhouse growers
Additionally, TRTC operates as a retail seller of hydroponic produce, herbs, and floral products, which are distributed in the Midwest and the Northeast United States; and produces and sells a line of cannabis flowers and cigarettes, as well as a line of cannabis pure concentrates, including oils, waxes, shatters, and clears to dispensaries in California.
The company operates through multiple subsidiary businesses, including Blum, IVXX Inc., Edible Gardens, MediFarm LLC and GrowOp Technology.
Blum’s retail medical cannabis facilities focus on providing the highest quality medical cannabis to patients who are looking for alternative treatments for their chronic medical conditions. Blum offers a broad selection of medical cannabis products including; flowers, concentrates and edibles through its Oakland, CA and multiple Nevada locations.
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As noted above, TRTC shareholders should be thrilled to find that the company was able to secure a spot as an authorized retailer of recreational cannabis as the state now assumes its rightful position as the world’s top market for the product, expanding the overall space by a major increment in the process.
We would also point out that this provides TRTC with a first mover advantage as only a hand full of these licenses were handed out. TRTC had ramped up operations by opening a second facility in Santa Ana last year. This benefits them with the ‘inventory on hand’ process going forward — a key factor.
“California has the oldest medical cannabis program in the nation and has the largest population out of any state in America. This adult-use license allows us to significantly expand our potential customer base in California beyond the medical market,” commented Derek Peterson, Chief Executive Officer of Terra Tech. “Terra Tech is one of only a handful of companies that has been issued this adult-use license in time for the Jan 1st start date. We believe this first mover advantage will enable us to grow our brand and gain traction with new customers in what is expected to be the nation’s largest cannabis market. Over the past several months we have worked diligently to expand both our retail presence and our cultivation facilities to prepare us for this exciting opportunity and we look forward to capitalizing on our progress to grow sales and build value for shareholders.”
Currently trading at a market capitalization of $413.7M, TRTC has a significant war chest ($6.7M) of cash on the books, which compares with virtually no total current liabilities. TRTC is pulling in trailing 12-month revenues of $31.9M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 45.6%. We will update the story again soon as further details emerge. Sign-up for continuing coverage on shares of $TRTC stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $TRTC, either long or short, and we have not been compensated for this article.