Ann: Quarterly Report and Appendix 4C, page-4

Although not yet at break-even point, it looks like EXL will quite likely have the best revenue figures for the last quarter than any other Australian cannabis/hemp company, and possibly by quite a large margin. The next quarter should see the last of the major hemp establishment costs for some time, so that aspect of the business should start to turn a profit in Q1 or Q2 2019.

The big unknown is what they plan to do with the medical cannabis business. I would prefer to see them concentrate on hemp for at least a couple of years, as there is already a proven and unfilled market in Australia which will grow exponentially as hemp becomes more widely accepted and the range of hemp products increases. The American operation should grow even faster, especially as EXL have an international distribution network out of the USA.

I would like to see them develop MC at a more leisurely pace and in a joint venture with another company to share the costs. Maybe a tie-up with an Oz company like THC which already has a state-of-the-art laboratory and planned growing facilities?

Although there will be very big revenues from medical cannabis in coming years, the market will take time to mature as governments and medical practitioners gradually overcome the many hurdles to widespread prescribing and use of MC. A measured, judicious approach to becoming involved in the MC market is probably the best course for EXL to avoid burning cash in a rushed entry.