CALGARY, AB – CanadaBis Capital Inc. (TSXV: CANB), a vertically integrated Canadian cannabis company, is pleased to announce our first quarter fiscal 2024 results featuring another consecutive period of growth in gross and net revenue. The Company’s Financial Statements and Notes, as well as Management’s Discussion and Analysis are available on our website and filed on SEDAR at www.sedar.com.
This quarter reflects another period generating positive earnings and robust Adjusted EBITDA, driven by a 45% increase in unit sales of combined concentrate and dry flower over the same period the prior year. Stigma Grow also continues to re-formulate concentrate lines to meet demands from current clients to maintain larger terpene and cannabinoid profiles across our product offering. With this ongoing innovation, coupled with demand for our award-winning Infused Pre-rolls, Live Rosin vapes and high CBD cartridges, CanadaBis anticipates continued positive performance in fiscal 2024.
“Building on the momentum realized in fiscal 2023, I am proud to report that our first fiscal quarter of 2024 represents another period of growing gross and net revenue,” said Travis McIntyre, CEO of CanadaBis. “Our unique capabilities and consumer-centric value proposition have earned brand loyalty and positioned CanadaBis to leverage the extracts segment while introducing additional innovative products such as our latest offering, the Super Slim Cigarette Style Pre-Rolls – Electric Dartz. By further optimizing operational efficiencies, exercising prudent financial management, and maintaining our competitive edge in the cannabis industry, we believe the Company is well positioned to drive continued shareholder value creation.”
Q1 2024 HIGHLIGHTS
Consistent Positive Sales — Gross revenue of $9.0 million grew 15% over the same period in 2023 and 18% over the previous quarter, while net revenue of $5.7 million was 12% and 20% higher than Q1/23 and Q4/23, respectively. This performance was driven by steady growth and continued demand for newly launched and existing SKUs, as sales of over 550,000 units of combined concentrate and dry flower in Q1/24 reflects a 45% increase compared to 380,000 units sold in Q1/23.
Continued Profitability — Net income generated during Q1/24 totaled $707,117 after tax, or $0.01 per share, compared to $700,313 during the same period in 2023, reflecting the impact of additional staff levels that align with revenue and production increases, along with enhanced advertising and promotional activities designed to foster demand in light of increased competition in the infused pre-roll market.
Adjusted EBITDA Contributing to Performance – Adjusted EBITDA totaled over $1.1 million for Q1/24 and reflects an increase of 16% over the same period the prior year, largely attributable to enhanced brand awareness, ongoing expansion of the Dab Bod products and the launch of the High Priestess brand, along with multiple new Dab Bod Brand SKUs introduced into the marketplace.
New Products Drive Demand — All new products launched during previous quarters have continued to post growth and record sales in Alberta, British Columbia, Manitoba, Saskatchewan and Ontario, including our newest and first-of-its-kind product line, Super Slim Cigarette Style Pre-Rolls, the “Electric Dartz”, which have received solid adoption across the provinces.
Cost Management in Focus — The Company has actively managed input expenses and inflationary pressures through negotiations and economies of scale, securing cost savings while increasing operational efficiencies and expanding yields in cultivation and extraction. We continue to maintain our cost management plans, along with a focus on increasing efficiencies, cash flow and liquidity.
OUTLOOK
With the continued year-over-year growth in gross and net revenue, net income, Adjusted EBITDA and rigorous cost controls delivered to date in Q1/24, CanadaBis has set the stage to deliver another year of strong results. We will strive to capitalize on our thriving extracts segment, while effectively navigating a competitive and dynamic climate inherent within the cannabis industry.
The Company has established several competitive advantages to ensure long-term success, including our butane hydrocarbon (BHO) extraction process, and we continue to explore new formulations that can meet demand and support the diversification of our product offerings. Rising demand from Alberta, Ontario, and British Columbia increased sales of resin and shatter infused pre-rolls and moonrocks, while Dab Bod and High Priestess products continue to attract greater market share.
As a vertically integrated cannabis company, we bring unique insights and the ability to respond swiftly to external factors that may impact selling prices, input costs or shifting customer demands. With an unwavering commitment to stringent and strategic capital management, we intend to leverage the extensive CanadaBis brand portfolio, excellent brand recognition, distinctive products and strategic resource allocation to further develop innovative products that optimally align with consumer preferences.
We remain dedicated to advancing success and exploring new opportunities through 2024 while continuing to prioritize shareholder value creation. The CanadaBis roadmap remains clear: actively pursue growth opportunities, stay agile and well-positioned to react within a volatile cannabis market and consistently strive to improve operational standards. We look forward to providing further updates on our progress and success during the upcoming fiscal year, and appreciate the support of our shareholders, Board of Directors and employees.
Adjusted EBITDA is a Non-GAAP performance measure. Refer to “Advisories – Non-GAAP Measures” for further details.
ABOUT CANADABIS CAPITAL INC.
CanadaBis Capital Inc. (TSXV:CANB) is a vertically integrated Canadian cannabis company focused on achieving large-scale growth, from cultivation to retail, in the fast-emerging global cannabis market. By targeting organic growth opportunities alongside the right-fit partners, we remain focused on finding and capitalizing on chances to grow, diversify and continue to lead our industry.
Our integrated subsidiaries:
- Stigma Pharmaceuticals Inc. – 100% held
- 1998643 Alberta Ltd. (operating as “Stigma Grow”) – 100% held; www.stigmagrow.ca.
- Full Spectrum Labs Ltd. (operating as “Stigma Roots”) – 100% held.
- 2103157 Alberta Ltd. (operating as “INDICAtive Collection”) -100% held; www.indicativecollection.ca.
- Goldstream Cannabis Inc. – 95% held.
ABOUT STIGMA GROW
Stigma Grow is a cutting-edge cannabis cultivation and extraction company positioned advantageously to meet the unmet market demands and stigmas within the legal cannabis industry head on, with products designed to disturb the status quo and dramatically shift the conversation surrounding Canada’s legal cannabis industry.
CAUTIONARY STATEMENTS
Non-GAAP Measures
This news release contains the financial performance metric of Adjusted EBITDA, a measure that is not recognized or defined under IFRS (a “Non-GAAP Measure”). As a result, this data may not be comparable to data presented by other cannabis companies. For an explanation and reconciliation of Adjusted EBITDA to related comparable financial information presented in the Financial Statements prepared in accordance with IFRS, refer to the MD&A for the three months ended October 31, 2023. The Company believes that Adjusted EBITDA is a useful indicator of operational performance and is specifically used by management to assess the financial and operational performance of the Company.
Adjusted EBITDA is a measure of the Company’s financial performance. It is intended to provide a proxy for the Company’s operating cash flow and is widely used by industry analysts to compare CanadaBis to its competitors and derive expectations of future financial performance of the Company. Adjusted EBITDA increases comparability between comparative companies by eliminating variability resulting from differences in capital structures, management decisions related to resource allocation, and the impact of fair value adjustments on biological assets, inventory, and financial instruments, which may be volatile on a period-to-period basis. Adjusted EBTIDA is not a recognized, defined, or standardized measure under IFRS. The Company calculates Adjusted EBITDA as net income (loss) and comprehensive income (loss) excluding changes in fair value of biological assets, change in fair value of biological assets realized through inventory sold, depreciation and amortization expense, share-based payments, and finance costs.
Regarding Forward-Looking Information
This news release includes certain “forward-looking statements” under applicable Canadian securities legislation. Forward-looking statements include but are not limited to statements with respect to our business and operations; timing of the Sundial products coming to market; the demand and market for live-resin vape cartridges, and our general business plans. Forward-looking statements are necessarily based upon a number of assumptions including: the ability of the Company’s products to compete with the pricing and product availability on the black-market; the market demand for the Company’s products; and assumptions concerning the Company’s competitive advantages. These assumptions, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: compliance with extensive government regulation, the general business, economic, competitive, political and social uncertainties; ability to sustain or create a demand for a product; requirement for further capital; delay or failure to receive board, shareholder or regulatory approvals; the results of operations and such other matters as set out in the Company’s continuous disclosure on SEDAR at www.sedar.com. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking statements. Investors are cautioned that forward-looking information is not based on historical facts but instead reflects management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although we believe that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have a material adverse effect on our future results, performance or achievements.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
