Zenabis Global Inc. (“Zenabis”) (TSXV: ZENA) runs like a military operation delivering top results, here’s why.  

I’ve been in the Canadian armed forces for 16 years now and that’s just how I’ve spent a lot of my free time. I’ve been either full-time or part-time on military training for 5 of the last 16 years. I finished joint command staff college last year and our chief administrative officer was actually my instructor. When I saw an opportunity for Zenabis I gave him a call I said, “look you are the perfect person for a specific role at this company, and there’s no way I could do it without you.” I was blessed enough that he agreed and said yes..

Andrew Grieve, Zenabis Global CEO

We recently had a chance to chat with Andrew Grieve CEO of Zenabis Global Inc. (“Zenabis”) (TSXV: ZENA) about the company, it’s expansion progress and a mission-driven culture that’s driving top results.

Here’s a copy of the transcript from the recorded call. 

Andrew Shaw (AS) Interviewer from Cannabis Daily; [00:01:37] So first and foremost, it looks like the most recent news seems to be a string of adding capacity which is fantastic. I mean specifically, as I gleam through your investor relations website – which is really well put together.

AS [00:01:49] In my research I got great disclosure and good visuals not just like the typical little link to SEDAR filings, which is a kudos to your operation. It makes it very easy to understand where you guys are in your path.

AS [00:02:00] Now what I specifically saw was a lot of commentary about adding grow capacity with a direct aim to be in the top three in terms of total production capacity.

AS [00:02:09] Can you maybe talk a little bit about that in the last couple of press releases and how these milestones increase capacity?

Andrew Grieve (AG) CEO Zenabis Global Inc.; [00:02:16] Yes – Certainly. So when this company was put together it was the combination of two businesses trying to farm. Sunpharm was a private cannabis producer. That at the time we had two licensed facilities and Bevo which at that time was a propagation floral business with two greenhouse facilities where we now have four licensed facilities; including three indoor facilities, and one enclosed greenhouse facility licensed for cannabis production.

AG [00:02:46] We’re also licensed for industrial hemp production and are growing industrial hemp at our other greenhouses and we’ve gone from having about 5000 kilograms of capacity at the point we completed the amalgamation, to now having more than 50,000 kilograms of capacity when you take into account the effective production level that we’re achieving in Atholville.

AG [00:03:11] So to grow our business by more than 10 fold from a capacity standpoint over the course of about seven months, I think it is a pretty amazing achievement but we’re not done because we’re going to about triple our capacity again within the next few months as we finish our Langley facility.

AG [00:03:36] This shows that we have fantastic construction teams that can finish projects on time and on budget and shows that we have an amazing licensing team that can get projects or get sites licensed incredibly quickly. And what’s more important than that is that we’re also cultivating effectively at our facilities in Atholville and Stellarton.

AG [00:04:01] So every single month we publish our cultivation output and compare it to our design capacity. So we say this is what we produce and then this is what we should have produced from the rooms that we harvested the product based on our design capacity and therefore here’s our performance level.

AG [00:04:20] So in June for example we produced more than 40 percent over what our design capacity was for the rooms that we harvested from on a yield per day basis.

AG [00:04:33] So we are producing great product and we’re building facilities quickly, we’re getting them license quickly, and then in those facilities we’re producing product.

AG [00:04:44] We’re producing product at a better rate than we originally forecast from a design classic standpoint. And then that product is saleable and high quality – we’re selling it in market – it’s all pretty awesome.

AS [00:04:58] And I’ll jump in on that that point right there.

AG [00:05:02]  I will just say from observation that what you just described to me is multiples-on-multiples, and also to look at your fact sheet in your Investor Relations website – it shows that truth hasn’t caught up to your stock price yet – which is good news for investors looking for a deal on a good stock.

AS [00:05:24] I would argue based on your fundamentals that your stock is not only on track for your goals, it sounds like a bird in hand vs. two in the bush. And the one in hand is outperforming. So you know it really looks like your in good shape on a bit of a wave.

AS [00:05:42] You keep this rolling at the pace at which you’re clipping – you know 10 times capacity in seven months and then 3 times that, in a further month – That speaks to absolutely everything. I think that speculative investors looking for a growth story might be looking for much of the stuff that you’re describing.

AS [00:05:59] Plus – you are selling in eight provinces and one territory now? Based on your investor fact sheet information as recently as Q2 2019, that’s not insignificant, tell us a bit about that. That’s pretty huge right?

AG [00:06:09] Yes. We have great relationships with provincial suppliers. In October we had two provinces. By March we had eight provinces and one territory. We have a medicinal distribution relationship with Shoppers Drug Mart and a relationship with Pharmasave. With these great relationships with pharmacies – from a distribution standpoint, we’re doing a great job with domestic distribution as well. And people like our product.

AS [00:06:41] Yeah. And I’ve looked. Speaking of your products. I was having a quick review around what the strains you are producing. You’ve got a pretty good spread of genetics. I mean like strains like SENSI STAR, WAPPA, SHISHKABERRY, MK ULTRA, DURGA MATA 2, A DAYTIME CBD PRODCUT and that’s just in the dried flower category. It looks like you’ve also got plans to expand, naturally of course, into the other edible sublingual’s.  What’s that looking like from a product development curve as the rules come down?

AG [00:07:23 We are making a lot of progress and I think one that you’ll note about our company is that we don’t spend time announcing LOI’s and we don’t spend time focusing on telling people that we are going to do something.


AG [00:07:45] So you’ll see in the future that we’ll announce our various value add products as they come online. And we intend to have a full value add product portfolio. And we think that we’ll do a great job of building our products. We have oil products now, we have soft shells for example that we’re shipping at the moment. But we intend to have a full selection of vapes, infused beverages and, edibles in the future.

AS [00:08:17] Yeah. And all of that of course is sort of the investor flavour of the day.

AS [00:08:32] You guys have done the hard work and you’re building capacity. Your website is loaded with photography of your facilities. I can see on your web site these things are not small scale. You’ve got like 3.5 Million square feet in terms of your design plan, as target capacity. Correct?

AG [00:09:13] Yes, and that space is built out already. And then a portion of that is currently converted for cannabis production. We have 3 1/2 million square feet of greenhouses and buildings across the country.

AS [00:09:24] Right. And you’re just licensing to be able to convert that space to cannabis specifically. Right?

AG [00:09:35] Yes. We also use existing space for our hemp production for our floral and propagation business.  We maintained our floral and propagation business which previously generated 33 million dollars in revenue and 8 million dollars in annual EBITDA

AG [00:09:52] The great thing about that business is 1) not only is it a fantastic existing profitable business but 2) it also means we have fantastic expertise in terms of industrial scale cultivation.

AG [00:10:07] So it’s not just that we have people who have cultivated cannabis on our team, we also have people with more than 30 years of industrial scale cultivation experience. And there’s a big difference between having basement growing experience and industrial scale cultivation experience.

AG [00:10:26] So what you see through in our production numbers is that we have industrial scale operations. That’s what we’re applying to the cultivation of cannabis.

AS [00:10:37] Yeah the market seems to be responding, and you guys are on sale all across this country with your various brands. I understand too that your company also has a distinct medical practice arm, as well as recreational.

AS [00:10:51] Are you separating those church and state worlds appropriately?

AG [00:11:01] Yes, we have distribution through shoppers drug mart and then we have a relationship with pharmasave. We also have the ability for patients to buy our products online. We also have signed distribution agreements for medical cannabis into Europe. We are also working on shipping through Malta.

AG [00:11:24] So we’re focused on being a global business in accordance with the name, Zenabis Global. But we are focused on that from a medical standpoint and we’ve previously disclosed that we expect to commence shipments of medical cannabis into Europe by the fourth quarter of 2019.

AS [00:11:45] That’s great. So on the medical business specifically which of course was the forerunner to recreational – in the medical business you’re clearly full guns blazing and sounds like you are on track expanding into different territories overseas, especially Germany.

AS [00:12:05] What other sort of pending factors might be out there in the international market – some of the things you think might be growth inspiring?

AG [00:12:16] Yeah. I won’t mention the other countries because as I said – we don’t really disclose where we just have just LOI’s but we’re an ambitious business and are looking to expand globally and our intent is to be a participant in every market globally where someone can consume either recreational or medical cannabis. And we’re going to continue working on that over the course of 2019 and through 2020. And like I said our intent is to be everywhere.

AS [00:12:48] And it seems like you’re making great strides into that! I like the fact that you’re also matching capacity with your distribution channels, there are a lot of off-balance enterprises out there that are ‘all hat and no cattle’.

AS [00:13:02] [Laughter].

AS [00:13:02] But in this effort you know you’ve really done a good job of pairing both your ability to produce and your avenues of distribution – I think in a very strong way.

AS [00:13:10] Now I’m looking I was looking at your quick facts here. I think you guys last year are showing a narrow loss.  I’m not sure of the exact number was it. How close are you guys… Or would you have a forecast timeline… When you’re going to hit that magic sort of red-to-black period?

AG [00:13:28] So we’ve disclosed that we expect to be cash flow positive after we finish our current capital build out. And we’ve also disclosed that the current build should be complete by the end of the third quarter. So the implication is that we will be at least cash flow positive in the fourth quarter of 2019.

AS [00:13:50] Wow. So you’re one of the rare folks that may actually be in putting distance here? That’s a wonderful thing! We know the industry has kind of gone through a tremendous amount of fluctuation – even this week- as a lot of red has appeared on the market, mainly because there’s been a few scandals here and there, and also because when the earnings come in the real rubber hits the road.

AS [00:14:12] It looks like you guys have enough cash for plenty of runway and that’s the current benchmark right? From what I’m looking at… I like the stock a lot, from everything you’re telling me, plus what I can see in your Investor Relations website at zenabis.com – it has just a tremendous amount of information. I recommend anyone reading this article to certainly check it out, because you guys are very transparent in your disclosure.

AS [00:14:41] You’re clearly above the standard – and I’ve seen a lot of different cannabis company websites and by my account Zenabis investor relations, and your visuals, charts and information is clear to your goals, and it’s clear to me your team has bench strength.

AS [00:14:52] I see Leo your chief growing officer comes from depths of conventional commercial horticulture?

AG [00:15:02] Yes, he built our greenhouse facility which is 48 acres under glass and that is our main asset.  He built that from 2.5 acres to 88 acres over the last 25 or so years of his life.

AG [00:15:11] …he’s the man when it comes to cultivation expertise and is absolutely amazing. He’s actually on site with me here in Atholville at the moment. So I’m on site, and a lot of our management team spent a lot of time here in Atholville – we’re here all the time. And Leo’s here all the time, our director of human resource is here as well as our SVP of Operations is located here.

AG [00:15:49] So it’s a management team that is willing to spend their time at the facility and it’s not a management team that is tied to their desks. That’s for sure.

AS [00:16:00] The fact that you’re even on the ground in the community. I mean that speaks number one to the fact you’re committed to the local resources. What’s your current body count across all your facilities? How many jobs have you guys created in Canada?

AG [00:16:20] I believe it’s just over 700. Some of those people were employed previously on the floral and propagation side… but job creation is one of the things that we’re most proud of. I mean really happy with what we’ve done. And as we were building the project here in Atholville for example, it was the largest private sector construction project ongoing in the province of New Brunswick at the time. We finished incredibly quickly. So from the time I first showed up here in Atholville in October of 2018, until now, there hasn’t been a lot of time in order to reach a sense of completion. Then when I showed up, I think we had four rooms built out and I indicated to the construction team at the time that I thought we could get the entire thing done by March. They said they thought I was crazy. They were right. And in the end we reached a sense of completion at the end of July. But if I hadn’t said Who knows where we would have ended up. I was talking to one other project manager and he said that when he first showed up in October one of the guys told him about the scale of the project and gave him the scope and the guy said this is a multi-year project. And Scott said to him, well the boss says we got to be done in about seven months. And the guy said there’s no way. And then we all sat down and we’ve done it.

AS [00:18:06] Well that brings up an interesting point too… with the surge in Canada’s cannabis facing industry there’s been a surge hirings. I’ve heard news that it’s hard to find top talent or reliable talent in this space, have you had the same experience or are you just finding great people as you go?

AG [00:18:28] I think the key is it’s about finding great people not great cannabis people.

AG [00:18:36] It’s always possible to find great people. The difficult part is how do you know that someone’s great? Well I learned a long time ago that you can’t just trust your gut in an interview. When I first started hiring people years ago I had the faulty perspective that maybe I was a great judge of character of people in a one hour interview and I learned pretty quickly that that wasn’t the case.

AG [00:19:11] So now – we rely on objective testing. So we test certain attributes for every person that we hire. We have a different personality profile for every role.  What we really need from someone for every single position in the company and we hire to that profile rather than just hiring someone on the basis that it was a great interview, or someone who has a great resume.

AS [00:19:45] So – You’re also applying a science based approach to hiring success!

AG [00:19:51] Right, same as how we grow our products – the approach – you don’t just get at what you think the right answer is… You have a hypothesis as to what’s going to work, and then you complete A B testing to optimize and determine what the best outcome is. That’s the approach that I’ve always taken with regards to people. And that’s the approach that we take with cultivating cannabis.

AS [00:20:23] OK let’s flip the conversation now over you to say anything particular you want to underscore for readers of this piece?

AG [00:20:39] I think that the other thing for people to know is that it’s just a business filled with incredibly dedicated diligent people who really want to deliver success to the communities in which we operate and for the stakeholders of the business.  The stakeholders of the business are not just the employees. It’s definitely not just shareholders, it’s shareholders and the community and its employees as well. But we’re really a values-based business. And we say it all the time, so our values are excellence compliance, responsibility, and delivery of stakeholder value. Everything that matters in this business can be put into one of those four core values. And it’s possible to ensure that every single conversation that you have from a business standpoint is focused on your values and that the approach that we take. Those are the four values and those drive our business.

AG [00:22:04] When it comes to excellence for example and responsibility I remember when I was on basic training in Gage town, Brunswick a long time ago in 2003 and my instructor said the motto of the Royal Canadian Regiment is never pass the fault and never pass the fault includes at least two of those values. That includes excellence that it includes responsibility because if you never pass the fault, if you always point out if there’s a problem then you’re taking responsibility. You’re pushing responsibility on to others where appropriate and if you truly pass a fault then you’re embracing the concept of excellence.  We have a lot of people from the military the organization but a lot of people who don’t have the military experience they quickly understand the approach why we do things the way we do them and you’ll hear things like you never pass a fault from the people in the organization who were never part of the army so they didn’t have the same training as some of the other people from the military and yet they’ve now embraced the same perspective and the same values.

AS [00:23:17] And that’s a proven method for organizing a mass culture, a mass of people towards one common purpose and goal – I see that in your profile as a CEO you have that Armed Forces history.

AS [00:23:29] What did you do in the armed forces?

AG [00:23:44] I’m an artillery office so I’m still in the reserves. I’m a commander for howitzers and morters and I do that part time. I’ve been in the Canadian armed forces for 16 years now and that’s just how I’ve spent a lot of my free time. I’ve been either full-time or part-time on military training for 5 of the last 16 years. I finished joint command staff college last year and our chief administrative officer was actually my instructor. When I saw an opportunity for Zenabis I gave him a call I said, “look you are the perfect person for a specific role at this company, and there’s no way I could do it without you.” I was blessed enough that he agreed and said yes.

AS [00:24:43] Well I think it’s wonderful. Thank you for your service. As a Canadian citizen I’ll put that right out there. And you also must also have a very distinct viewpoint on PTSD and cannabinoids in terms of combat soldiers and therapies, especially in context with these things. I know there is an ongoing story in the news about access to medical cannabis for the sake of miltary PTSD sufferers. What’s your thoughts on that?

AG [00:25:11] I think that what Canada has done with regards to medical cannabis and recreational cannabis is fantastic. I believe in giving people the right to pursue what they believe is the most effective form of treatment for whatever ailment. It is essential that we treat veterans right and treat people with PTSD appropriately and not only should they be allowed to access medicinal cannabis but we should be funding studies and we should be ensuring that they don’t have to pay for something that can actually solve their problem and actually help them. And it’s not for everybody right.  I’m not making any claims as to efficacy of candidates for PTSD. But I do know anecdotally that there were some people that I know and providing them relief for PTSD is fantastic. It’s really really important to me.

AS [00:26:20] You made a good point about the anecdotal evidence being out there and the whole story being out there – the more important part of course is when you in a position of privilege to use power to effect change, or even in a commercial perspective, in a position to benefit from these truths – there is a lot of value in organizations such as yourself funding research. People such as yourself with the clear understanding to know the Pharmaceutical Benefits of cannabinoids and potentially PTSD sufferers and having the power to actually effect study and get the science behind it – there’s a huge gap as you know in actual clinical trials because of various reasons. What I mean is those with personal experience who are in a position of power can affect those changes to good policy.

AS [00:27:07] Like you said, with focus on compliance, working within the rules, providing good quality medicines, that meet scientific standards of how it’s grown and how it’s cured, and then hopefully how the therapies can be extracted from those things.

AS [00:27:19] It’s just good to see another big supporter of cannabis as medicine. I believe that as a health therapy, in many different dimensions – it does have a lot of value. I’m just glad to hear that a CEO of a very well-designed company… Almost the third biggest in terms of grow capacity.. also has understanding and knowledge of how it affects people’s lives. It’s a pleasure to hear your compassion and commitment.

AG [00:27:42] I have one thought on this medicinal point – I think it’s also important that people understand that we’re behind as a result of unreasonable prohibition. So there was prohibition of something where there shouldn’t have been prohibition for too long. And as a result we don’t yet have the capacity to treat a whole host of ailments that we likely can treat with cannabis. We have to catch up because like I said it was an unreasonable prohibition in the first place. It was prohibition without, in my opinion, a valid purpose. And so incumbent on us as a society and on the business community to solve that problem.

AG [00:28:33] Because it’s not right that people don’t yet know everything that can be done with cannabis and don’t’ yet have the ability to receive the best possible treatment in some cases because of poor government policy in the form of unreasonable prohibition.


Errors or omissions? contact editor@cannabisdaily.today


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