May 28, 2019

Matica Enterprises Inc (CNSX:MMJ) Preparing for Adult-Use Edibles Legalization

Midas Letter
Midas Letter
Matica Enterprises Inc (CNSX:MMJ) Preparing for Adult-Use Edibles Legalization

Matica Enterprises Inc (CNSX:MMJ) (OTCMKTS:MMJFF) (FRA:39N) CEO Boris Ziger provides an overview of the company and discusses Matica’s readiness for the legalization of edibles this fall. The company has cultivated its first crop at its 10,000 square foot Dorval, Quebec facility and anticipates receiving its sales license later this year. Ziger discusses the company’s financials and notes that Matica has $7 million in cash, which it will use to fund the construction of a greenhouse near Montreal. Ziger explains the advantages of operating in Quebec, which include cheaper utilities and a government mandate to purchase from Quebec LPs. Ziger shares details of the company’s recent purchase of Trichome Treats Inc, an award-winning chocolatier and explains how the move helps Matica create a line of adult-use extracts including premium edibles and beverages.


Fraser Toms:  Joining me now is Boris Zieger, the CEO of Matica Enterprises, trading on the CSE under the symbol MMJ. Boris, how are you doing today?

Boris Ziger:  I’m great, great to be here.

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Fraser Toms:  Thanks for coming. This is your first time on the show.

Boris Ziger:  It is, first time.

Fraser Toms:  Yeah, so let’s give our audience kind of an impression about what Matica is all about and the general footprint of the company.

Boris Ziger:  All right, absolutely. Matica, we’re a cannabis company. We’re a license holder in Quebec. We’ve got a facility, 10,000 square feet in Dorval, and we’ve just got our cultivation license back in October. And we’ve got our first crop, so we’re really excited about that.

Second one is on its way, and hopefully we’ll have our sales license sometime later this year, and we’re good t o go.

Fraser Toms:  Great. So you guys just recently released your year-end financial statements?

Boris Ziger:  Yes, yes.

Fraser Toms:  And in that document, you can see that you guys have over about $7 million in cash?

Boris Ziger:  That’s right.

Fraser Toms:  So what’s the plan moving forward over the next little while to spend said cash?

Boris Ziger:  Greenhouse. We bought a property just south of Dorval, it’s about an hour away of our other facility, just south of Montreal, and it’s 181 acres that we bought, and we’re building a million square feet of greenhouses in 200,000 square foot increments. So that is starting pretty much now.

Fraser Toms:  And what’s your feelings about operating out of Quebec? I mean, I don’t know where you’re from, but I know that the energy situation seems to be favourable –

Boris Ziger:  Quebec is a great place to operate, to be honest with you. I’m from Ontario, from Toronto, but Quebec is just a fantastic place. We sort of going through our numbers, and they seemed a little off, a little on the low side, and we had to go back to look at our electricity bill, and it’s like, wow, that is really cheap! It’s a great place to operate. The government has been fantastic there; the local communities have been very supportive. Just a great place to work. A lot of good staff, too; very talent people in Quebec.

So we’re growing some incredible product right now.

Fraser Toms:  As you look at sort of the landscape of the various companies that are out there, your competitors, as it were, was Quebec part of your decision? And how do you –

Boris Ziger:  Kind of, yeah. There wasn’t a lot of people in Quebec. There still aren’t a lot of people in Quebec.

Fraser Toms:  Right.

Boris Ziger:  And or course, the Quebec government, they have a mandate to try and purchase as much cannabis from Quebec growers, so we feel that we’ve got a great market in Quebec. And again, just the cost of doing business there has been so much cheaper…and of course, we’re from the mining industry, so we respect cash very much, because it’s always been hard to come by. So anytime that we can spend as little as possible, that’s great for us, and it’s great for our shareholders, and Quebec is the perfect place to do that.

Fraser Toms:  So as sort of, I guess, a late joiner, what’s your view on how to ultimately be around when the last companies are standing? Because inevitably, as we move forward, there will be companies that don’t make it, or get bought up, or – you know, it’s a tough go out there.

Boris Ziger:  Well, it’s kind of like the tortoise and the hare. So we’re kind of like the tortoise; we’re getting there. But we will get there. We’ve got our licenses now, we’ve got our plans in place, everything seems to be moving really well. We’ve populated it with great people, they’re doing an incredible job, and I think at the end of the day, yeah, we’re playing catch-up to the HEXOs of the world, but I think we’ll get there.

Fraser Toms:  And what are you most excited about, kind of, entering the space? There’s, I understand you have some new business going on at this point.

Boris Ziger:  Yes, yes, yeah. We had a couple new businesses, a couple new things happening. Obviously you’re familiar with the unify situation and all that with the creams, but the big thing now is edibles. Edibles are coming; it’s going to happen sometime in October, we hope, and we’re getting ready for it. So we purchased an edibles company. Well, sort of an edibles company; chocolatiers, and they make incredible tasting chocolates, just really, really, they’re award-winning people, they know what they’re doing, and we’re going to be working with them to blend cannabis into their products and create a premium edible product which will be a fabulous adult-use cannabis. And really excited about it.

Fraser Toms:  Yeah. For sure, I mean, moving forward, you see edibles being a big part of not just your business but many…

Boris Ziger:  Every business. I mean, yeah, I just think edibles for people who haven’t been using cannabis and are just starting to use cannabis, it’s a great way of getting into the whole space. nobody smokes anymore, even cigarettes.

Fraser Toms:  They don’t. [laughter]

Boris Ziger:  I mean, who smokes, right? So, and dealing with all the paraphernalia and all that stuff, a lot of people, they have no idea how to do it. But to open up a box of chocolates and to have a chocolate, and to use it – I guess to use it intelligently, and I think the consumer needs to be educated on how to use chocolate properly, and I think the idea of having 10 milligram units, is what the government is planning, is probably a very good way of doing it.

Fraser Toms:  Yeah.

Boris Ziger:  I think Health Canada, in many ways, has really done a very good job and taken a great approach to this, and I think it’s going to be very successful, and we’re going to have a wonderful rollout into the edibles market. I’m looking forward to it. The chocolatiers, they make incredible chocolates, truffles and melt-aways, all of these can be infused with cannabis. Obviously, gummies are going to be part of it. Beverages as well. And any other kind of cannabis-infused situation, like a vape or something, is going to be part of that rollout.

And we’ve got some wonderful trademarks that they’ve trademarked a while ago, which are going to sort of, you know, give us a bit of an edge in the market, I think. And also flavour. I mean, if you’re going to eat a chocolate, it better taste good, right?

Fraser Toms:  Absolutely. So where can people find – do you have an interweb site?

Boris Ziger:  That would be on social media, Facebook, Instagram, Twitter. Our website is

Fraser Toms:  That’s not difficult enough.

Boris Ziger:  Not at all. Not at all, no.

Fraser Toms:  Great. Well, thanks so much for being here, Boris, and that was a good introduction to the company, and we’d like to have you back in a few months and see how you’re doing.

Boris Ziger:  I would love to come back.

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