Fourth quarter sales growth of 176% year-over
year and 23% from the third quarter of 2021 with all legacy Nova
branded stores now converted to Value Buds
EDMONTON, AB, March 21,
2022 /CNW/ - Nova Cannabis Inc. (the "Company"
or "Nova") (TSX: NOVC) today released its audited annual
consolidated financial statements (the "annual financial
statements") and management's discussion and analysis
("MD&A") for the year ended December 31, 2021.
"We launched Value Buds in 2021 to provide cannabis consumers in
Canada with a better option, and
the traction of our store format has been a resounding success.
Once again, we delivered strong sequential and year over year sales
growth for the quarter and we now have 78 stores open across
Alberta, Saskatchewan and Ontario," said Darren
Karasiuk, CEO of Nova. "Following Sundial's pending
acquisition of our majority shareholder, Alcanna, we will gain a
cannabis focused partner that is committed to supporting our
value-based model with the infrastructure and financial resources
to drive the expansion of our disruptive strategy at a much larger
scale."
FOURTH QUARTER 2021 FINANCIAL AND OPERATING
HIGHLIGHTS
- Sales of $47.6 million, a 175.9%
increase from the fourth quarter of 2020, and a 23.2% increase from
the third quarter of 2021
- Gross profit of $8.4 million, or
17.7% of sales, a 58.0% increase from the fourth quarter of 2020
and a 29.0% increase from the third quarter of 2021
- Nova now has seventy-eight (78) stores open, an increase of
forty-four (44) stores since December 31,
2020, and all legacy Nova branded stores have been converted
to Value Buds
FISCAL YEAR 2021 FINANCIAL HIGHLIGHTS
- Sales of $134.4 million, a 112.2%
increase from $63.3 million in
2020
- Gross profit of $24.9 million, or
18.5% of sales, a 19.7% increase from $20.8
million in 2020
- Cash increased by $9.3 million to
$10.5 million as at December 31, 2021
SUNDIAL ACQUISITION OF ALCANNA
On October 7, 2021, Sundial
Growers Inc. ("Sundial") (NASDAQ: SNDL) entered into an
arrangement agreement (the "Arrangement Agreement") to
acquire all of the issued and outstanding common shares of Alcanna
Inc. ("Alcanna"), Nova's majority shareholder (the
"Sundial-Alcanna Transaction"). On February 25, 2022, Alcanna and Sundial mutually
agreed to extend the outside date for closing the Sundial-Alcanna
Transaction to March 30, 2022 in
accordance with terms of the Arrangement Agreement to complete the
required closing matters contemplated by the Arrangement
Agreement.
FOURTH QUARTER AND YEAR END 2021 FINANCIAL RESULTS
For further information, refer to the Company's annual financial
statements and MD&A for the year ended December 31, 2021, which are available from the
Company's profile on SEDAR, at www.sedar.com, or on the Company's
website at www.novacannabis.ca.
ABOUT NOVA CANNABIS INC.
Nova Cannabis Inc. (TSX: NOVC) is one of Canada's largest and fastest growing cannabis
retailers with a goal to disrupt the cannabis retail market by
offering a wide range of high-quality cannabis products at
every-day best value prices. The Company currently operates
seventy-eight (78) locations across Alberta, Ontario, and Saskatchewan under its Value Buds banner. The
Company is majority owned by Alcanna Inc. (TSX: CLIQ).
Additional information about Nova Cannabis Inc. is available at
www.sedar.com and the Company's website at
www.novacannabis.ca.
FORWARD LOOKING STATEMENTS
This news release contains forward-looking statements or
information (collectively "forward-looking statements")
within the meaning of applicable securities legislation.
Forward-looking statements are typically identified by words such
as "continue", "anticipate", "will", "should", "plan", "intention",
and similar words suggesting future events or future performance.
All statements and information other than statements of historical
fact contained in this news release are forward-looking statements.
In particular, this news release contains forward-looking
statements pertaining to: the Company's expectations regarding the
impact the closing of the Sundial-Alcanna Transaction will have on
Nova's growth and business strategies.
With respect to forward-looking statements contained in this
news release, the Company has made assumptions regarding, among
other things: the Company's ability to identify locations for,
construct and open new stores and the costs related thereto; the
availability of hardware and equipment for those stores; government
regulation and applicable laws will not change in a manner adverse
to the Company; receipt of necessary regulatory approvals to open
new stores; the Company's ability to obtain leases for new sites
and attract the necessary personnel to operate new stores; demand
for the products the Company sells; other factors that will drive
sales growth in the Value Buds banner; availability of acquisition
opportunities; sustainability of competitors' businesses and
competition in the retail cannabis industry, including from the
illicit cannabis market; consumer demands; and factors that
influence consumer behavior.
Although the Company believes that the expectations reflected in
the forward-looking statements, and the assumptions on which such
forward-looking statements are made, are reasonable, especially
given the unprecedented uncertainty of the full extent and impact
of COVID-19, there can be no assurance that such expectations and
assumptions will prove to be correct. Readers should not place
undue reliance on forward-looking statements included in this news
release. Forward-looking statements are not guarantees of future
performance and involve a number of risks and uncertainties that
may cause actual performance and financial results to differ
materially from any estimates, forecasts or projections. These
risks and uncertainties include, among other things, the duration
and severity of the COVID-19 pandemic on the business, operations
and financial condition of the Company; the risk that Nova will be
unable to execute its strategic plan and growth strategy, as
planned without significant adverse impacts from various factors
beyond its control; dependence on suppliers; potential delays or
changes in plans with respect to capital expenditures and the
availability of capital on acceptable terms; risks inherent in the
retail cannabis industry; competition for, among other things,
customers, supply, capital and skilled personnel; changes in labour
costs and markets; incorrect assessments of the value of
acquisitions; general economic and political conditions in
Canada (including Alberta and Ontario), and globally; industry conditions,
including changes in government regulations; fluctuations in
foreign exchange or interest rates; unanticipated operating events;
failure to obtain regulatory and third‐party consents and approvals
when required; changes in tax and other laws that affect us and our
shareholders; the potential failure of counterparties to honour
their contractual obligations; stock market volatility; and the
other factors described in the Company's public filings available
at www.sedar.com. Readers are cautioned that this list of risk
factors should not be construed as exhaustive.
The forward-looking statements contained in this news release
are made as of the date hereof. Except as expressly required by
applicable securities legislation, Nova does not undertake any
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. The forward-looking statements contained in this news
release are expressly qualified by this cautionary statement.
SOURCE Nova Cannabis Inc.