Vancouver, British Columbia, Canada -- January 30, 2018 --
InvestorsHub NewsWire -- Namaste Technologies Inc. (“Namaste”
or the “Company”) (CSE:N), (FRANKFURT: M5BQ), (OTCMKTS: NXTTF) is pleased to
announce the filing of its unaudited quarterly financial
statements, management’s discussion and analysis and certification
of the quarterly filings for the first quarter of fiscal 2017. The
statements for the period can be accessed on SEDAR at www.sedar.com. The Company’s sales for the
three months ending on November 30, 2017, were $4.9M, representing
a $2.8M or 136% increase in comparison with the Company’s quarter
ended November 30, 2016. Gross margin also increased to
32% for the three months ended on November 30, 2017, in comparison
to 28% for the Company’s quarter ended November 30, 2016.
During the financial reporting period of September 1, 2017, to
November 30, 2017, the Company focused on expanding sales in
existing territories as well as in emerging markets such as Mexico
and Brazil while reducing sales exposure in the United States.
The Company also sold its US assets and operations as a
strategic decision to eliminate risk related to US market
exposure.
The Company remains focused on achieving profitability and on
launching its medical cannabis marketplace, NamasteMD, through our
wholly-owned subsidiary, Cannmart Inc.
Quarterly Financial Highlights
- The majority of revenues were generated by several key markets.
The top five countries generated 84% of revenues for the three
months ended November 30, 2017. In the previous year, the top five
countries generated 79% of revenues. The table below depicts gross
revenues by country.
Revenues by country |
Country |
November 30,
2017 |
November 30,
2016 |
|
|
|
Great Britain |
1,233,983 |
547,281 |
Australia |
1,516,582 |
– |
United States of America |
677,552 |
912,011 |
Brazil |
354,444 |
101,923 |
Canada |
355,632 |
80,238 |
New Zealand |
104,484 |
134,168 |
Germany |
262,610 |
23,437 |
Ireland |
61,820 |
35,505 |
Israel |
62,844 |
22,236 |
Other |
301,160 |
230,389 |
|
Total |
$4,931,110 |
$2,087,188 |
- The Company’s cost of sales for the three months ended November
30, 2017, were $3.4 million (2016 – $1.5 million), which resulted
in a gross profit of $1.6 million (2016 – $0.6 million). The gross
profit increased by $1.0 million or 167%, which is primarily due to
the growth in revenue outside the United States. The gross profit
margin increased year over year from 28% to 32% due to
better-operating efficiencies.
- Operating costs were $4.7 million (2016 – $1.5 million), which
is an increase of $3.2 million. The increase in operating costs is
primarily due to non-cash charges of $2.6 million, which included
share-based compensation, shares for services, amortization of
intangible assets, and depreciation.
- Selling expenses for the three months ended November 30, 2017,
were $1.1 million (2016 – $0.5 million), which is an increase of
$0.6 million. The increase is due in part to an increase in
advertising expenses of $0.1 million and consulting expenses of
$0.2 million. Advertising expenses relate to online search services
as well as other online promotional and social media tools utilized
by the Company to generate sales. These costs further represent the
Company’s significant investment into search engine optimization
and its ongoing customer acquisition strategy. In addition to this,
there were non-cash expenses related to shares for services of $0.2
million.
- Consulting expenses related to compensation amounts paid to
various companies and individuals for marketing, order fulfillment,
customer service activities, e-commerce product development,
back-office e-commerce support and sales commissions. The increase
in consulting fees is primarily related to information technology
in order to develop current and new revenue channels that the
Company is working towards.
- Administration expenses for the three months ended November 30,
2017, were $3.3 million (2016 – $0.9 million), which is an increase
of $2.4 million. The increase is primarily due to share-based
compensation of $2.1 million and shares for services of $0.1
million
- Other expenses for the three months ended November 30, 2017,
were $0.3 million (2016 – approximately nil), which is an increase
of $0.3 million. The increase is primarily due to the amortization
of intangibles of $0.2 million, which relates to the amortization
of the customer list from the acquisition of Australian
Vaporizers.
Management Commentary
Sean Dollinger, President and CEO of Namaste
comments: “During the first quarter ended November 30, 2017,
Namaste embarked on implementing many strategic business
initiatives focused on expansion in international markets other
than the United States. In addition, posting record-breaking
revenues, management remains focused on seeking and securing strong
partnerships to further accelerate growth going forward. We expect
to see significant upside to Namaste’s revenue and profitability as
a direct result of the many acquisitions and partnerships that were
initiated both during and following this quarter. Management
believes there are many more strategic opportunities that exist in
the cannabis market that will serve to strengthen Namaste’s
position moving forward. In particular, the NamasteMD platform will
be a key driver of growth. We are extremely excited at where
the industry is headed and believe Namaste is well-positioned in
2018 and beyond.”
About Namaste Technologies Inc.
Namaste is the largest online retailer of medical cannabis
delivery systems globally. Namaste distributes vaporizers and
smoking accessories through e-commerce sites in 26 countries and
with 5 distribution hubs located around the world. Namaste has
majority market share in Europe and Australia, with operations in
the UK, Canada, and Germany and has opened new supply channels into
emerging markets including Brazil, Mexico and Chile. Namaste,
through its acquisition of Cannmart Inc., a Canadian based
late-stage applicant for a medical cannabis distribution license
(under the ACMPR Program) is pursuing a new revenue vertical in
online retail of medical cannabis in the Canadian market. Namaste
intends to leverage its existing database of Canadian medical
cannabis consumers, along with its expertise in e-commerce to
create an online marketplace for medical cannabis patients,
offering a larger variety of product and a better user
experience.
Forward-Looking Information
This press release contains forward-looking information based on
current expectations. These statements should not be read as
guarantees of future performance or results. Such statements
involve known and unknown risks, uncertainties and other factors
that may cause actual results, performance or achievements to be
materially different from those implied by such statements.
Although such statements are based on management’s reasonable
assumptions. The Company assumes no responsibility to update or
revise forward-looking information to reflect new events or
circumstances unless required by law.
Although the Company believes that the expectations and
assumptions on which the forward-looking statements are based are
reasonable, undue reliance should not be placed on the
forward-looking statements because the Company can give no
assurance that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. These
statements speak only as of the date of this press release. Actual
results could differ materially from those currently anticipated
due to a number of factors and risks including various risk factors
discussed in the Company’s disclosure documents which can be found
under the Company’s profile on www.sedar.com.
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E the Securities Exchange Act of 1934, as
amended and such forward-looking statements are made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The CSE has neither reviewed nor approved the
contents of this press release
On behalf of the Board of Directors
“Sean Dollinger”
Chief Executive Officer
Direct: +1 (786) 389 9771
Email: info@namastetechnologies.com
Further information on Namaste and its products can be accessed
through the links below:
www.namastetechnologies.com
www.namastevaporizers.co.uk
www.everyonedoesit.co.uk
www.australianvaporizers.com