NOUV Launches New Website to Accelerate NOUV Dividend to PURA Shareholders
KALY Partnership Enhances PURA Overall
Valuation
DALLAS, May 30, 2019 (GLOBE NEWSWIRE) -- via OTC
PR WIRE -- Puration, Inc. (PURA) (“PURAâ€)
today released a management update that reviews current
performance, anticipated future organic performance, insight into
the company’s merger and acquisition (M&A) strategy, and the
latest on the upcoming stock dividend to be issued to PURA
shareholders in conjunction with the spinoff of PURA’s cannabis
cultivation operation. The narrative of the presentation is
included here in this release in its entirety. The full
presentation is available on the company’s website at www.purationinc.com/managment-update.
CBD Likely To Out Pace THC In Cannabis Industry And CBD
Beverages Lead The Way
A recent Forbes
feature on how cannabis is revolutionizing the
beverage industry reported that marijuana growth within the newly
legalized market has exceeded demand. Some states, the
feature reports, have years of inventory. While THC is legal in
some states, it cannot be transported across state lines.
However, as a result of the 2018 Farm Act, hemp farming is now
legal in the U.S., and CBD from hemp is also legal. With CBD
being legal, food and beverage producers are now willing to explore
opportunities to infuse hemp derived CBD into their products while
still in a holding pattern on THC.
The Forbes feature goes on to talk about the impact that cannabis,
be it in THC or CBD form, is having on the beverage industry.
The global beverage industry is currently a $1 trillion
market and beverage innovation is vital to the
producers ability to maintain, let alone grow market share.
The feature uses the word “transformative†when talking about the
impact cannabis will have on the $1 trillion market.
PURA now has years of experience at infusing cannabis into a
beverage. We have worked with different extracts and
different infusion methods. We have updated formulas to
improve flavor and extend shelf life. PURA’s experience is
difficult to put on a balance sheet, but definitely has
value. Being over $1 million in annual sales is a major
milestone and has garnered the attention of more than one
substantial beverage industry player. Management believes now is
the time to augment our organic growth strategy with an M&A
strategy. See the M&A section below to learn more.
Current Performance: $1 Million 2018 Revenue With $4
Million 2019 Target Revenue
The company posted its 2019 Q1 financial report last
week demonstrating over a $1 million base annual revenue
run rate. The company broke $1 million in sales for the 2018
fiscal year. The company also has a new $1.5
million order to produce private labeled CBD water which is
not yet reflected in the company’s financial statement.
Demand for the company’s cornerstone beverage product,
EVERx CBD Sports Water, has strained the company’s
current production capacity, but a second production facility is
anticipated to be online by the end of June. From the current
better than $1 million annualized revenue run rate and the $1.5
million order, management is targeting $3 million in sales from
existing beverage products. PURA has a number of new products
in various phases of launching from which management anticipates
realizing another $1 million in target revenue making the company’s
overall 2019 organic revenue target $4 million. The $4
million target does not include the potential benefit that might be
realized through the execution of PURA’s M&A strategy (see more
on M&A below). Once the expanded production is in place,
management may consider revising its 2019 $4
million revenue target upwards.
PURA has formulated a new THC infused beverage, THC Savor.
The company is working on establishing production and distribution
relationships in regions where the beverage can be legally produced
and sold. The company has also formulated and produced a
water designed to enhance the cannabis experience by either
consuming the water before or during cannabis use or using the
water as a conduit for cannabis smoke. The product is called
Telluride Happy Water and has already been sold into a pilot market
test.
M&A Roll-Up In Cannabis Beverage Market To Accelerate
Market Share Expansion
The non-alcoholic and alcohol segments alike are
both targeting cannabis innovation opportunities. The
beverage industry is rich with major brand names that control
overwhelming market share. However, with THC still not legal
on a federal level and the hemp derived CBD federal legalization
details not yet percolated down though all state laws, let alone,
federal enforcement agencies, the major brand names are just
hovering at the moment and not engaging. The major brand
names are leaving the playing field open for entrepreneurial
companies to grab market share within a timeframe window that won’t
stay open for ever. Leveraging our success with EVERx CBD
Sports Water, we are winning the confidence of investors to back us
in the acquisition of other cannabis beverages.
Infusing cannabis into a beverage is not as simple as one might
think. The quality of the underlying cannabis is one issue
and the quality of the extraction process is another. The
infusion formulation is yet another. Clarity and
sustainability of the suspension is not a simple task, nor is
implementing a flavor neutral extract. PURA now has years of
experience involving many trials and many errors. Our years
of experience are extended yet further through the years of
extraction research and development conducted by our partner
Kali-Extracts (KALY). PURA holds the
sole license for beverage infusion purposes to KALY’s U.S. Cannabis
Extraction Process.
Among other courters, PURA’s tires have been kicked by two major
brand names. In hindsight, it is our opinion that the
interest was in what we had learned about extraction and infusion,
and less about our brand and market share. Even at $1 million
in annual sales, and even if we achieve our 2019 $4 million target
revenue, if a major brand name beverage company could reasonably
learn all we know about extraction and infusion, they could almost
instantaneously capture more market share than it has taken us
years to create. Establishing meaningful and defensible
market share is critical to building shareholder value that can
sustain through federal legalization of all cannabis plants and
extracts. M&A is a logical strategy to pursue in order to
improve the potential of building meaningful and defensible market
share that can survive the competition from major brand names that
will enter the market post federal legalization.
We believe we have shared enough here on our M&A strategy to
demonstrate to investors and shareholders that we are on the right
track. We’re going to keep the rest of the cards to our chest
at this time so as to maintain the secrecy of our secret
weapon.
Coming Soon - 1 For 5 Stock Dividend To PURA
Shareholders
In October last year, PURA spun off its
cannabis cultivation business to Nouveau (NOUV) (“NOUVâ€) in exchange for a $1.2
million convertible note issued by NOUV to PURA. The
spinoff deal included a commitment that the note would promptly be
converted to common shares of NOUV and that those converted shares
would be distributed in a stock dividend to the shareholders of
PURA. The prerequisites to issuing the dividend were for NOUV to
bring its delinquent financial disclosures current and then execute
a 1:400 reverse split to support a 1 for 5 dividend distribution of
NOUV common stock to PURA shareholders. NOUV has made great
strides in the execution of the prerequisites. The delinquent
financial statements have been drafted. The operations are
making great strides. The company has existing conventional
nursery operations and transitional cannabis cultivation
operations. NOUV anticipates coming out soon with meaningful
revenue targets stemming from its conventional nursery operations
and transitional cannabis cultivation operations.
Nevertheless, the updated financial statements have not been
published and without the updated financial disclosures being made
public, the company cannot promptly pursue the planed reverse split
and dividend issue as originally designed at this time.
Management speculates that scrutiny on penny stocks market-wide has
resulted in increased bureaucracy that has in turn resulted in a
backlog of disclosure procedures through historically customary
channels. Accordingly, NOUV and PURA have devised a plan to
work through the prevailing penny market environment.
NOUV has launched its own disclosure site at www.NOUV-INFO.com. The site has been designed
for NOUV to be able to publish its own financial statements making
them easily accessible to the public without otherwise making
shareholders suffer the current bureaucratic delays resulting from
what we speculate as increased scrutiny on penny stocks
market-wide. The www.NOUV-INFO.com site
currently has all NOUV’s historical disclosures in addition to
relative market and capital structure information, news and
management information, and an NOUV stock quotation. As
mentioned above, the delinquent filings have been drafted and NOUV
plans to publish those filings by the end of this week.
While NOUV is pursuing an alternative disclosure strategy to
accelerate the company’s overall progress in addition to getting
the planned dividend of NOUV stock issued in a dividend
distribution to PURA shareholders, management will continue to
advance the publication of financial disclosures through
historically customary channels.
To further work around what has turned out to be the protracted
time required to execute a NOUV reverse stock split, NOUV and PURA
have alternatively initiated the declaration of a preferred
convertible NOUV stock that is intended for immediate distribution
to NOUV shareholders. The preferred stock is to be exchanged
for the $1.2 million note. Specifically, the plan is for
there to be 120 million preferred shares at a value of $0.01 each
totaling the $1.2 million. The preferred shares will bear
convertible rights to be exchanged for common stock. Once
declared and established, NOUV plans to promptly issue the
preferred shares to PURA shareholders in a ratio of 1 NOUV
preferred share for every 5 PURA shares held. PURA and NOUV
expect to promptly publish specific details on this updated
dividend distribution strategy following the publication of the
outstanding financial disclosures.
To see the NOUV website published today, visit www.NOUV-INFO.com
To see the NOUV Research Analyst Report and Independent Fairness
Opinion, visit www.NOUV-INFO.com/research
For more information on Puration, visit http://www.purationinc.com
Disclaimer/Safe Harbor:
This news release contains forward-looking statements within the
meaning of the Securities Litigation Reform Act. The statements
reflect the Company's current views with respect to future events
that involve risks and uncertainties. Among others, these risks
include the expectation that any of the companies mentioned herein
will achieve significant sales, the failure to meet schedule or
performance requirements of the companies' contracts, the
companies' liquidity position, the companies' ability to obtain new
contracts, the emergence of competitors with greater financial
resources and the impact of competitive pricing.