Crop Infrastructure Corp (CSE: CROP) announced today that its entire Nevada operations are basically a write off due to poor operational ability. The firm notified the market via an early morning press release that nearly 850 acres of pivot irrigated land will be “released” while they attempt to rectify the remaining portion.
As per the news release, eight of ten pivots covering its hemp crop have been infested by weeds due to poor maintenance plans. While the joint venture partner had attempted to plant cover crops to limit the effect of weeds, it seems it wasn’t enough as the land was consumed by the invasive species – leaving many to question why the field has not been consistently monitored to prevent such an event from occurring.
And what wasn’t destroyed by invasive weeds, appears to have been taken over by a herd of antelope that the company indicated destroyed several of its Northern pivots. The company as a result indicates that it will only be focusing on 500 acres of its pivot-covered hemp crop on a go-forward basis.
It’s unclear what damage was sustained specifically at its THC farm, however the firm acknowledged that it too was severely affected by invasive weeds. In reference to the THC farm, Crop Corp did indicate one thing – that the sale of the property, and thus a potential means of acquiring cash, had fallen through. The property was originally to be sold to Trinity Global Investments LLC for US$24 million, of which a considerable share was to be provided to Crop Corp through its 49% owned joint venture at the property.
Investors were anticipating that the debt from Crop Corp’s Nevada operations – over $10.5 million as of the latest financials – would be paid off, followed by significant cash flows as a result of the season’s harvest to be conducted by the firm. However, it appears that that debt will take another season to be paid off as a result of this years failed crop, and the anticipated cash flow might not arise for another full year.
We have been humbled by the realities of commercial scale farming with hard lessons learned, but we are determined to forge ahead and we are readying our teams to complete the harvesting of the remaining hemp in Nevada, and THC in California, Washington and Oklahoma as the October harvest season is just around the corner.Michael Yorke, CEO of Crop Corp
As if this wasn’t enough for Crop Corp shareholders to take at once, the firm also announced that it had collected slightly over $51,000 as a result of its early exercise warrant program – a source of funding many had hoped would be successful for the cash strapped issuer. A falling share price however prevent many warrants from being exercised at all.
Crop Infrastructure Corp closed today’s session at $0.04, down 27.27% on the day.
Information for this briefing was found via Sedar and Crop Infrastructure Corp. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.