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by Stockwatch Business Reporter
The S&P/TSX Cannabis Index remained unchanged at 128.53 points Thursday, while the Canadian Securities Exchange Composite Index gained 3.47 points to 485.68. Israel-based IM Cannabis Corp. (IMCC: $1.41) released its second quarter results for 2020 just before the market closed yesterday. The cannabis producer slipped six cents to $1.40 on 62,700 shares in trading Wednesday. As expected, IM Cannabis saw its sales rise to $3.7-million in Q2 2020 from $1.3-million in Q1 2020.
The increase in Q2 was expected by the market because IM Cannabis signed a flurry of supply deals soon after Q1 ended. The deals were actually signed by the company's distribution "partner," Focus Medical Herbs Ltd., to sell IM-branded medical cannabis to Israeli companies. The total revenue expected from those deals is $193.5-million over a three-year period. One area that remains murky, though, is exactly how much of the revenue IM Cannabis will be receiving. IM calls it an "asset-light model" because the company will not be on the hook to grow or package any of the cannabis being sold. It is essentially licensing its brand, while Focus Medical grows and packages some of the cannabis, and pays third party cannabis companies to grow and package the rest.
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