Ann: Quarterly Activities/Appendix 4C Cash Flow Report, page-5

Such a good quarterly. The news that we didnt expect is:




Which is going to lead to new products for the medcinial space. ECS really have not made a wrong move since Nan took charge, navigated this industry so well.


Also for those just checking ECS out for the first time, heres a summary of the company:

ECS is a medicinal cannabis cultivator, growing GMP grade medicinal cannabis organically outdoors and in PCEs (Protected Crop Enclosures) in Victoria Australia off the banks of the Murray River.

In the financial year 2022-2023 ECS produced over 4250 kgs of this medicinal cannabis , highest amount produced in Australia by any listed cultivator, (this amount is under the capacity that ECS is capable of as ECS did not utilise tunnels that were completed this year, going forward our output will be a lot more fully utilising the new PCEs with two harvests a year.)
ECS is selling the product B2b (Business to Business) to Australian medicinal cannabis companies (20+ Australian company contracts) and overseas (6+ International company contracts.) These are multimillion dollar offtake contracts some recent contracts established this year include recurring $3.3 million a year to Germany, $3.4 mill a year to Melboure based Entoura. We have far more demand for our product than we currently can supply.

Along with outdoor fields of cannabis, ECS has 17 PCE (Protective Crop Enclosures) These bring in 700k in revenue a year each (700 * 17) Thats 11.9 million from these alone. ECS will continue to add tunnels to meet demand at a cost of 200k.

Currently ECS is valued at around $25 million market cap, with approx 1100 million shares on issue, of which the Managing director Nan Maree Schoerie is the biggest holder with over 100 mill shares, so her interests are well aligned with shareholders, she built the cannabis farm from the ground up.

Financially we have just had the first cashflow positive quarter in December last year this has continued now with this last quarterly just released, this will more than likely to continue as we have just had a record harvest completed in May, and May sales were $2.8 million, highest in the companys history, which have not been reflected yet but will be in the June quarterly released soon in July.

We have a debt faciility with NAB currently at $2million which has not been drawn on due to Nans tight money management, this is quite different to other listed cultivators who are 10s of millions in debt like CAN and LGP (the only other two listed cultivators who are nowhere near cash flow positive and are uncompetitive due to indoor energy intensive grows, and have large debts, CAN especially large with $60million debt and growing cannabis less than ECS and getting less revenue.) Our cashflow and debt facility means we do not require dilutive capital raisings to grow the business evdient by this last quarterly we have debt facility of $2million and $2.54 cash in bank and are cash flow positive.

Going forward ECS still has ODC approval for a further 9 PCEs, which will likely be completed this year (one off cost of $1.8 million that will bring an extra recurring revenue of $6.3 million a year.)