TORONTO and GLIL YAM,
Israel, March 10, 2022 /PRNewswire/ -- IM Cannabis
Corp. (the "Company", "IM Cannabis", or "IMC")
(CSE: IMCC) (NASDAQ: IMCC), a leading medical and adult-use
recreational cannabis company with operations in Israel, Canada, and Germany, provided preliminary unaudited
financial results for the three months and fiscal year ended
December 31, 2021. All amounts are
reported in Canadian dollars unless otherwise stated.
Preliminary Q4 and Full Year 2021 Financial & Operational
Highlights:
- Preliminary revenues for Q4 2021 were at least $20 million, representing an approximate increase
of at least 37% from Q3 2021 and at least 308% compared to the same
prior-year period.
- Preliminary gross margin before fair value adjustment was at
least 18% in Q4 2021, temporarily impacted by modest investments in
the German market and impact of COVID-19 restrictions in
Canada that disrupted labour and
supply chains.
- Preliminary revenues for fiscal year 2021 were at least
$54 million, representing an
approximate increase of at least 240% from fiscal year 2020.
Preliminary gross margin before fair value adjustment was at least
22% in fiscal year 2021.
- Focus Medical Herbs Ltd. ("Focus Medical") successfully
imported approximately 399 kilograms of premium, indoor-grown,
Canadian dried cannabis following approval from the Ministry of
Agriculture to import to the Israeli market in Q4 2021. Subsequent
to Q4 2021, the WAGNERS brand was launched in Israel.
- In Q4 2021, the Company announced the anticipated 2022 launch
of WAGNERS brand in the rapidly evolving German medical cannabis
market.
- Signed a definitive agreement in Q4 2021 to acquire Oranim,
Jerusalem's leading medical
cannabis pharmacy, positioning IMC as one of the largest retailers
of medical cannabis in Israel. The
acquisition of Oranim is conditional upon receipt of all requisite
approvals, including regulatory approval from the Israeli Medical
Cannabis Agency. The closing of the Oranim acquisition is expected
by the end of Q2 2022.
Management Commentary
"We built significant momentum across our operating platform in
2021, as evidenced by our annual revenues growth of at least 240%
to a record of at least $54 million,"
said Oren Shuster, Chief Executive
Officer of IMC. "In Israel, we have become among the largest
distributors of medical cannabis and are well positioned to capture
market growth today and in the future with the potential for
recreational legalization. We continue to capture meaningful market
share in the premium segment in Canada driven by our staunch focus on
cultivation excellence and increasing brand recognition of WAGNERS
and Highland Grow. Importantly, our execution with our recreational
and medical operations in Canada
and Israel and our global
distribution expertise provides us with the blueprint to
effectively capitalize on the substantial German market opportunity
as it liberalizes its cannabis laws."
"As we move through 2022, we remain focused on realizing
synergies across our supply chain while scaling operations in the
three largest federally legal markets where we currently operate,
which makes IMC uniquely positioned to emerge as the leading
purveyor of premium cannabis on a global scale. I look forward to
providing further updates to the market during our upcoming
earnings call later this month," concluded Shuster.
The information provided within this release should be read in
conjunction with the Company's audited consolidated financial
statements for the year and three months ended December 31, 2021 (the "Audited Financial
Statements"), and the accompanying management's discussion and
analysis for the year and three months ended December 31, 2021, which will be filed on the
Company's SEDAR profile at www.sedar.com.
About IM Cannabis Corp.
IM Cannabis (NASDAQ: IMCC) (CSE: IMCC) is a leading
international cannabis company providing premium products to
medical patients and adult-use recreational consumers. IM Cannabis
is one of the very few companies with operations in Israel, Germany, and Canada, the three largest federally legal
markets. The ecosystem created through its international operations
leverages the Company's unique data-driven perspective and product
supply chain globally. With its commitment to responsible growth
and financial prudence, and the ability to operate within the
strictest regulatory environments, the Company has quickly become
one of the leading cultivators and distributors of high-quality
cannabis globally.
The IM Cannabis ecosystem operates in Israel through its commercial relationship
with Focus Medical, which cultivates, imports, and distributes
cannabis to medical patients, leveraging years of proprietary data
and patient insights. The Company also operates medical cannabis
retail pharmacies, online platforms, distribution centres and
logistical hubs in Israel that
enable the safe delivery and quality control of IM Cannabis
products throughout the entire value chain. In Germany, the IM Cannabis ecosystem operates
through Adjupharm GmbH ("Adjupharm"), where it also
distributes cannabis to pharmacies for medical cannabis patients.
In Canada, IM Cannabis operates
through Trichome Financial Corp. ("Trichome") and its
subsidiaries Trichome JWC Acquisition Corp. ("TJAC") and MYM
Nutraceuticals Inc. ("MYM"), where it cultivates and
processes cannabis for the adult-use market at its Ontario, Nova
Scotia, and Quebec
facilities under the WAGNERS and Highland Grow brands. For more
information, please visit www.imcannabis.com.
Disclaimer Regarding Financial Information
The financial information presented in this press release is
based on preliminary, unaudited financial statements prepared by
management, for the fourth quarter and fiscal year ended
December 31, 2021. Accordingly, such
financial information may be subject to change. While the Company
does not expect there to be any material changes to the financial
information presented in this press release, to the extent that it
is inconsistent with the information contained in the Audited
Financial Statements, the financial information contained in this
news release shall be deemed to be modified or superseded by such
Audited Financial Statements. The making of a modifying or
superseding statement shall not be deemed an admission for any
purposes that the modified or superseded statement, when made,
constituted a misrepresentation for purposes of applicable
securities laws.
Disclaimer for Forward-Looking Statements
This press release contains "forward-looking information" and
"forward-looking statements" within the meaning of applicable
Canadian and United States
securities laws (collectively, "forward-looking
information"). Forward-looking information are often, but not
always, identified by the use of words such as "seek",
"anticipate", "believe", "plan", "estimate", "expect", "likely" and
"intend" and statements that an event or result "may", "will",
"should", "could" or "might" occur or be achieved and other similar
expressions. Forward-looking information in this press release
includes, without limitation, statements relating to the financial
results of the Company for the fourth quarter of 2021 and the
fiscal year ended December 31, 2021,
the resumption of growth in Israel, Germany and Canada since the end of the fourth quarter of
2021, expected revenues drivers in the first quarter of 2022, the
ability of the Company to continue to capture meaningful market
share in the premium segment of the Canadian cannabis market,
expectations about financial performance of the Company's Canadian
operations in the first quarter of 2022, the ability of the Company
to achieve growth in the German medical cannabis market and the
Company's emerging position as a leading purveyor of premium
cannabis on a global scale.
Forward-looking information is based on assumptions that may
prove to be incorrect, including but not limited to the ability of
the Company to execute its business plan and the continued growth
of the medical and/or recreational cannabis markets in the
countries in which the Company operates or intends to operate, the
Company maintaining "de facto" control over Focus Medical in
accordance with IFRS 10, Focus Medical maintaining its existing
Israeli medical cannabis propagation and cultivation licenses and
the expected decriminalization and/or legalization of adult-use
recreational cannabis in Israel.
The Company considers these assumptions to be reasonable in the
circumstances. However, forward-looking information is subject to
business and economic risks and uncertainties and other factors
that could cause actual results of operations to differ materially
from those expressed or implied in the forward-looking information.
Such risks include, without limitation: any failure of the Company
to maintain "de facto" control over Focus Medical, Focus Medical
maintaining its existing Israeli medical cannabis propagation and
cultivation licenses; any determination that the Company is
directly engaging in the Israeli medical cannabis market; the
ability of the Company to comply with applicable government
regulations in a highly regulated industry; unexpected changes in
governmental policies and regulations affecting the production,
distribution, manufacture, import, export or use of medical and/or
recreational cannabis, as applicable, in Israel, Canada and Germany; any unexpected failure of any of
Focus Medical, TJAC or MYM to maintain in good standing or renew
all required licenses, permits or authorizations to conduct
cannabis activities in their respective jurisdictions; the ability
of the Company, its subsidiaries and Focus Medical to maintain
primary and ancillary business licenses, permits and approvals; the
Company and Focus Medical having to rely on third party cannabis
producers to supply Adjupharm and Focus Medical with product to
successfully fulfill previously announced sales agreements and
purchase commitments; any unexpected failure of any of Focus
Medical, Adjupharm, Trichome or MYM to maintain in good standing or
renew all required licenses, permits or authorizations to conduct
cannabis activities in their respective jurisdictions; reliance on
the Company's commercial facilities in Germany and Canada and Focus Medical's commercial
facilities in Israel to conduct
medical cannabis activities and any unexpected failure of the
Company, its subsidiaries or Focus Medical to maintain such
commercial facilities in good standing with all applicable
regulations, including all required licenses and permits; any
adverse consequences as a result of certain legal proceedings
initiated by Israeli municipal authorities against Focus Medical,
Oren Shuster, and certain other
shareholders and stakeholders of Focus Medical (the
"Construction Proceedings"); unexpected disruptions to the
operations and businesses of the Company and/or Focus Medical as a
result of the COVID-19 global pandemic or other disease outbreaks
including a resurgence in the number of cases of COVID-19, and the
ongoing uncertainty that could result in restrictions to contain
the virus being re-imposed or imposed on a more strict basis,
including restrictions on movement and businesses; unexpected
consequences that may arise if Focus Medical were to lose its
designation as an essential service in the State of Israel during any current or
resurgent COVID-19 outbreak; the extent to which COVID-19 impacts
the global economy; the success of new COVID-19 workplace policies
and the ability of people to return to workplaces inconsistent
public opinion and perception regarding the use of cannabis;
perceived effects of medical cannabis products; and the Company's
ability to maintain or improve the brand position of the IM
Cannabis brand in the Israeli medical cannabis markets.
Please see the other risks, uncertainties and factors set out
under the heading "Risk Factors" in the Company's management's
discussion and analysis dated November 15,
2021 and annual information form dated April 26, 2021 filed with Canadian securities
regulators and which are available on the Company's issuer profile
on SEDAR at www.sedar.com. Any forward-looking statement included
in this press release is made as of the date of this press release
and is based on the beliefs, estimates, expectations and opinions
of management on the date such forward-looking information is made.
The Company does not undertake any obligation to update
forward-looking statements except as required by applicable
securities laws. Investors should not place undue reliance on
forward-looking statements. Forward-looking statements contained in
this press release are expressly qualified by this cautionary
statement.
Non-IFRS Measure
This press release includes reference to "Gross Margin", which
is a non-International Financial Reporting Standards
("IFRS") financial measure. Non-IFRS measures are not
recognized measures under IFRS, do not have a standardized meaning
prescribed by IFRS, and are therefore unlikely to be comparable to
similar measures presented by other companies. The Company defines
gross margin as the difference between revenues and cost of goods
sold divided by revenues (expressed as a percentage), prior to the
effect of a fair value adjustment for inventory and biological
assets. IM Cannabis has used or included this non-IFRS measure
solely to provide investors with added insight into IM Cannabis's
financial performance. Readers are cautioned that such non-IFRS
measure may not be appropriate for any other purpose. Non-IFRS
measures should not be considered in isolation or as a substitute
for measures of performance prepared in accordance with IFRS.
Three months
ended
|
December 31,
2021
|
December 31,
2020
|
|
|
|
Revenues
|
$
20,250
|
$
4,900
|
Cost of goods
sold
|
$
16,550
|
$
2,109
|
Gross profit before
FV adjustments
|
$
3,700
|
$
2,791
|
Gross margin before
FV adjustments
|
18%
|
57%
|
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Company Contact:
Maya
Lustig, Director Investor & Public Relations
IM Cannabis
+972-54-677-8100
maya.l@imcannabis.com
Investor Relations:
Brooks
Hamilton, Director
MZ Group – MZ North America
+1 949-546-6326
IMCC@mzgroup.us
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SOURCE IM Cannabis Corp.