SEATTLE, WASHINGTON, Dec. 14, 2022 (GLOBE NEWSWIRE) -- Pervasip Corp. (OTCPK: PVSP) (“Pervasip” and the “Company”) today announced that its President and Chief Executive Officer, German Burtscher, issued the following letter to Pervasip’s shareholders:
Dear Shareholders,
We achieved several important accomplishments during 2022 despite significant turmoil in the regional and national cannabis markets, material economic pressures, and political uncertainty. Our key accomplishments included:
- We continued rationalizing our business, cutting expenses, shedding underperforming assets, and upgrading the infrastructure that our independent cultivators utilize, leading to increased yields and reduced production costs by 20%, a material change to cost of goods.
- We expanded our management team, launched an exciting new brand, and expanded the Artizen premium brand collection in Washington with craft flower and related products.
- We developed strategic relationships to diversify into the regional concentrates market and negotiated to acquire assets capable of adding $12 million in annualized revenue in Washington by the end of next year.
- We identified a series of exciting expansion opportunities, including licensed wholesale and retail operations that we hope to acquire to establish ourselves as a vertically integrated multi-state operator (“MSO”).
The last point is especially important. While the local Washington market presents compelling opportunities for the acquisition and roll-up of wholesale flower, concentrate, and other related production assets by our independent cultivators, the regulatory environment in Washington prevents vertical integration into retail assets. That limitation is a significant constraint on growth since our independent cultivators cannot acquire dispensary assets to internalize retail revenues that are typically about three times wholesale receipts. Stated differently, we could be generating about three times our current revenues, or about $46 to $52 million, if our existing footprint was in another state. Thus, diversification has been and remains a key strategic focus for us – both within Washington by expanding our offerings and exploiting compliant acquisition opportunities, and in valuable emerging cannabis markets by replicating our proven formula for success in new U.S. and Canadian geographies.
We previously commenced execution of a plan to position Pervasip to capitalize on our progress and plans moving forward, including by gearing up for a name change and engaging investment bankers and other advisors to evaluate the best approach to achieve our local and national strategic plan in a challenging cannabis climate while delivering significant value to our shareholders.
In doing so, and in conjunction with our announced and other acquisition plans, we are finalizing some material structural changes that will simultaneously eliminate dilution from Pervasip’s historical debts and position us to complete acquisitions and raise capital on fair terms with fixed prices that do not put pressure on our stock. To prevent harmful speculation, our planned changes will involve a series of related transactions that will not include a reverse split. We will provide more information about our intentions in January of 2023, however, suffice it to say that we do not believe that our current market price accurately reflects the intrinsic value of our business and brands, and we are committed to addressing that circumstance as soon as possible during the first half of next year.
The timing of these changes is important. The valuations and fates of MSOs and other participants in the cannabis industry have vacillated in several waves since state legalization commenced. We believe that increased legalization is inevitable in time, both at the federal level and in the form of relaxed regulatory restrictions on vertical integration in Washington. Preparing ourselves for that day is an important aspect of our long-term plans, including by expanding our Artizen and other brands and establishing and building on our footprint in valuable new geographies. Doing so will start in the first half of next year as we structure our existing and planned new assets into a strategic platform for building tremendous shareholder value.
This is an exciting time for all of us, and I urge you to be on the lookout for a stream of announcements over the first half of 2023. I wish all of you a wonderful, peaceful Holiday Season and good fortune and health in the New Year.
Best Regards,
German Burtscher
President and Chief Executive Officer
Pervasip Corp.
Pervasip Corporation
Pervasip Corp., a developer of companies and technologies in high value emerging markets, owns Artizen Corporation and its subsidiary, Zen Asset Management LLC, a diversified asset management company founded to acquire, develop, and support companies and technologies in the cannabis industry. ZAM’s existing clients operate four licensed cannabis cultivation and one processing facility in Washington. Most of the biomass produced by these independent cultivators has been sold historically under the Artizen™ brand, including all-time top selling products in flower in Washington state. Additional information on Artizen-branded products is available online at www.artizencannabis.com. Pervasip additionally owns 5% of KRTL Biotech, Inc., a developer of biotechnologies with a focus on pharmaceutical applications of cannabinol and psilocybin. Additional information on KRTL is available online at www.krtlbiotech.com.
Forward-Looking Statements
This news release contains statements and information that, to the extent that they are not historical fact, may constitute “forward-looking information” within the meaning of applicable securities legislation. Forward-looking information may include financial and other projections, as well as statements regarding future plans, objectives, or economic performance, or the assumption underlying any of the foregoing. In some cases, forward-looking statements can be identified by terms such as may, would, could, will, likely, except, anticipate, believe, intend, plan, forecast, project, estimate, outlook, or the negative thereof or other similar expressions concerning matters that are not historical facts. Examples of such statements include, but are not limited to, statements with respect to the objectives and business plans of the Company; ability to realize benefits from its recent corporate appointments; ability to retain its key personnel; the intention to grow the Company’s business and operations; the competitive conditions of the industries in which the Company operates; and laws and any amendments thereto applicable to the Company. Forward-looking information is based on the assumptions, estimates, analysis and opinions of management made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances at the date that such statements are made, but which may prove to be incorrect. The material factors and assumptions used to develop the forward-looking information contained in this news release include, but are not limited to, key personnel and qualified employees continuing their involvement with the Company; and the Company’s ability to secure financing on reasonable terms. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking information, including, without limitation, risks relating to the future business plans of the Company; risks that the Company will not be able to retain its key personnel; risks that the Company will not be able to secure financing on reasonable terms or at all, as well as all of the other risks as described in the Company’s periodic disclosure statements. Accordingly, readers should not place undue reliance on any such forward-looking information. Further, any forward-looking information speaks only as of the date on which such statement is made. New factors emerge from time to time, and it is not possible for the Company’s management to predict all of such factors and to assess in advance the impact of each such factor on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking information. The Company does not undertake any obligation to update any forward-looking information to reflect information or events after the date on which it is made or to reflect the occurrence of unanticipated events, except as required by law, including securities laws.
For further information, please contact:
T: (206) 590-2408 Ext 102
E: info@pervasip.net
