Mr. Bruce Linton reports

TWEED MARIJUANA INC. Q3 RESULTS AND OPERATIONAL HIGHLIGHTS

Tweed Marijuana Inc. has released its financial results for the three- and nine-month period ended Sept. 30, 2014. Tweed's wholly owned subsidiaries Tweed Inc. and Tweed Farms Inc. are licensed producers under the marijuana for medical purposes regulations.

Financial summary:

• The company reported third quarter sales of $316,117 bringing year-to-date sales to $504,353.
• Gross margin was $74,475 and $183,754 for the three and nine months ended Sept. 30, 2014, respectively.
• The cash position was $8,357,196 at the end of the quarter.
• Net loss for the three- and nine-month period was $2,376,592 and $6,293,189.

Overview

During the quarter, each of the two operating companies, Tweed and Tweed Farms, focused upon the priority of managing a limited inventory to a sustainable client list while implementing production in both the Smiths Falls and Niagara facilities with the objective of establishing a substantial and sustained increase in inventory and clients by December, 2014.

Tweed has been focused on steadily building out capacity to meet market demand. Its first product harvest in May, for example, was the output of a single growing room. Tweed had three grow rooms in production by the end of July and on Aug. 31, had an additional three grow rooms brought on-line, bringing production capacity to six grow rooms by the end of the quarter and meaning that harvests are now sixfold larger than early harvests. Tweed has committed to introducing an additional six rooms by the end of calendar 2014 and remains on pace to reach this target. In July, Tweed announced that it had entered into collaborative research partnerships with researchers from Ryerson University and the University of Ottawa to increase the knowledge base surrounding medical marijuana. These research projects underscore the significant opportunity that exists for early entrants into this sector to expand the knowledge base relating to medical marijuana and to develop proprietary knowledge and intellectual property. Research will be initially focused on examining environmental factors that can influence the quality and yield of medical marijuana, as well as assessing correlations between active ingredients in medical marijuana and strain effectiveness on selected ailments.

Tweed Farms

On June 19, 2014, Tweed Marijuana acquired all the assets of Prime 1 Construction Services Corp., including related land, greenhouse and building. On Sept. 19, 2014, the company name was changed to Tweed Farms Inc. On Aug. 11, 2014, Tweed Farms received its Health Canada licence to grow and ship marijuana plants and subsequently commenced a growing cycle in 10 per cent of the 350,000-square-foot facility.

Subsequent events

Harvests under way

On Oct. 17, 2014, Tweed Farms commenced shipping its plants to Tweed for harvesting. On Nov. 14, 2014, the harvest had been cut, trimmed, and was drying and curing so as to be available for sale in the beginning of December along with Tweed harvests from six growing rooms at its Smiths Falls facility that had commenced in October.

Corporate governance

On Oct. 28, 2014, Tweed Marijuana was pleased to announce the addition of John K. Bell, FCPA, FCA, ICDD, to its board of directors. Mr. Bell brings a wealth of experience across a number of industries, significantly enhancing the company board of directors. The company anticipates this will be followed shortly by the appointment of a new chief executive officer.

Major medical outreach investments

On Nov. 4, 2014, Tweed announced that it had made a major investment in medical conferences, notably the Primary Care Updates series. The series took place in Mississauga, Richmond Hill, Ottawa, Calgary and Vancouver and is typically attended by more physicians than any other national continuing medical education program. Members of Tweed's medical advisory board were among the faculty presenting. Tweed also announced that in conjunction with other licensed producers, it would be co-sponsoring through an unrestricted grant, a five-city CME program, to be held in February to March, 2015, in partnership with the Canadian Consortium for the Investigation of Cannabinoids.

Licence renewed for a further year

On Nov. 19, 2014, the company announced that Tweed had renewed its licence to cultivate and sell marijuana under the MMPR. The renewed licence allows Tweed to produce up to 3,500 kilograms of marijuana over the next year, reflecting Tweed's present built-out production capacity. Tweed Marijuana also announced that Tweed Farms has been approved to begin another growing cycle this December in a footprint representing approximately 10 per cent of the entire facility.

Teleconference call

Bruce Linton, the company's interim chief executive officer, chairman and co-founder, and Don Gibbs, the company's chief financial officer, will host a conference call on Nov. 26, 2014, at 8:30 a.m. ET to discuss the company's financial results.

Date:  Nov. 26, 2014

Time:  8:30 a.m. ET

Toll-free dial-in number:  844-835-6557

Participant international dial-in number:  224-633-1282

Conference ID:  40361839

A replay of the call will be available beginning Nov. 26, 2014, at 2:30 p.m. ET through 11:59 p.m. ET on Dec. 10, 2014, and can be accessed by dialling 855-859-2056 (toll-free in North America) or 404-537-3406 (international) and using access code 40361839.

We seek Safe Harbor.