Announcement

MKTUPDTE: CBD: Operations Update, Covid-19 10:56a.m. 
CBD  
27/03/2020 10:56  
MKTUPDTE  
PRICE SENSITIVE  
REL: 1056 HRS Cannasouth Limited  
 
MKTUPDTE: CBD: Operations Update, Covid-19  
 
The Board of Cannasouth Limited (NZX:CBD) provides the following update on  
the operations of Cannasouth and group companies ("CBD", "Group") in relation  
to the Coronavirus (Covid-19) global pandemic.  
 
The health, safety and wellbeing of our people, and their families is our top  
priority. An Action Plan for each entity and site has been implemented and  
aligns with advice from the New Zealand Government and Ministry of Health.  
 
Cannasouth Limited (parent company) & Cannasouth Plant Research Limited (100%  
subsidiary)  
Cannasouth has developed a modern working environment with IT systems and  
infrastructure that allow for agile work practices. Our people use video  
conferencing and online communications daily so the transition to mandatory  
working from home has been seamless. The Hamilton based business has  
suspended some research activities to comply with the current Covid-19 alert  
level while continuing with other product development activities and building  
business capability to support future product sales when the regulatory  
environment allows. Several of the conferences CBD had scheduled to attend  
in the upcoming months have either been postponed or cancelled. We continue  
to communicate with our stakeholders online.  
 
Cannasouth Cultivation Limited (50% owned)  
This operation is located in the Waikato and construction of its  
state-of-the-art hybrid greenhouse cultivation facility is now on hold during  
the Covid-19 lockdown. Our project team can use this time to make further  
progress with planning and system design for the new facility while working  
from home.  
 
Midwest Pharmaceutics NZ Limited (60% owned)  
This GMP manufacturing operation is located in Hastings and currently has two  
key focuses. One is the development of its medicinal cannabis production  
capability and the other is existing pharmaceutical and health & wellness  
product production and contract manufacturing. For the latter, Midwest will  
continue its operations as it falls under the Covid-19 essential service,  
producing health sector medicines. Production is currently running at full  
capacity with the team working hard to keep up with an increase in demand  
from its customers. The GMP and clean room protocols, along with other  
pandemic management measures, ensure safe working conditions for our people.  
 
Summary  
Health precautions were implemented early on for the safety of our teams and  
anyone physically interfacing with the Group.  
 
CBD currently has no debt, significant cash reserves and the ability to make  
adjustments to its business strategy and plans to extend cash reserves while  
still making progress towards its objectives and achieving key milestones.  
Applications are underway for the various Government Covid-19 employer  
support measures, as appropriate.  
 
The Board believes future demand for medicinal cannabis medicines, and the  
existing health and well-being products market will remain positive, and  
remain confident about the outlook for the Group.  
 
The board is assessing the Group's position on an ongoing basis, and will  
continue to keep the market informed of any changes to the operations of the  
business in relation to Covid-19 that may have a material impact on our  
current business strategy.  
 
-ENDS-  
 
For further information visit www.cannasouth.co.nz or contact:  
 
Mark Lucas  
CEO, Cannasouth Limited  
Email: mark.lucas@cannasouth.co.nz  
Mobile: 021 484 649  
 
Tony Ho  
Chairman, Cannasouth Limited  
Email: tony.ho@cannasouth.co.nz  
Mobile: +61 417 345 839  
End CA:00350813 For:CBD Type:MKTUPDTE Time:2020-03-27 10:56:16  

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