Attention in MMJ shifts to operating margins, long-term profitability

Heliospectra forecasts that America’s growing public support of legalized medicinal and recreational cannabis use will push industry to more sustainable cultivation practices and cost-effective LED light strategies.

The American population’s increasing support for the legalization of cannabis has been a primary driver of the industry’s rapid growth, with the trend being validated by the Gallup Poll released in October 2016 showing that 60 percent of Americans are in favor of legalization, the highest percentage of support recorded in the 47-year trend. The accelerating momentum of support has given rise to the passage of new cannabis regulations and offered lawmakers the confidence to introduce new legislative initiatives for action, as reflected on 2016 ballots. The states considering legalization in the upcoming election include North Dakota, Arkansas and Florida for medicinal use and Arizona, California, Maine, Massachusetts and Nevada for recreational use.

“An increase in the number of licensed greenhouses, indoor facilities and regulations will focus the industry on sustainable growing techniques and the documented data that integrated LED lighting systems and control technologies provide,” said Staffan Hillberg, CEO of Heliospectra. “Commercial cannabis cultivators recognize that the ability to dynamically adjust, monitor and customize the full light spectrum specific to plant need ensures consistent crop health, product quality and harvest results.”

Given the distinct possibility that November election results will expand licensed recreational states from four to nine in the burgeoning U.S. cannabis industry, financial and advisory firm Viridian Capital Advisors predicts that attention will now shift to operating margins, long-term profitability and business efficiencies.

“As downward pricing pressure from the commoditization of cannabis continues, growers are rapidly adopting more advanced cultivation products and processes,” explains Scott Greiper, President of Viridian Capital Advisors. “Technology solutions, including LEDs, enable cultivators to establish competitive advantage and cost-effective operations while boosting yields.”

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Heliospectra AB

 


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