TORONTO, Nov. 30, 2020 /CNW/ - 48North Cannabis Corp.
("48North" or the "Company") (TSXV: NRTH), a vertically integrated
Licensed Producer focused on manufacturing high-quality cannabis
products, building progressive and thought-provoking brands, and
low-cost cultivation, has released its financial and operating
results for the first quarter ended September 30, 2020. The Company's financial
statements and related management discussion and analysis for the
period are available on the Company's SEDAR profile at
www.sedar.com and on the Company's website at
Financial and Operating Highlights for Fiscal Q1 2021
- Quarterly revenue of $7.7
million, representing an 80 per cent increase over fourth
quarter 2020 revenues of $4.3
million, and a 382 per cent year-over-year increase over
first quarter 2020 revenues of $1.6
million. This result is consistent with the Company's
year-end forecast and also represents 73 per cent of fiscal 2020
annual net revenues.
- During the first quarter, the Company used $7.1 million in cash, with $2.8 million used in operations, $3 million in non-cash working capital and
$1.3 million in investing activities,
largely related to the acquisition of property, plant and
equipment. To that end, the Company decreased its cash use by 19
per cent from $8.55 million in Q4
2020 to $7.1 million in Q1 2021.
48North expects to continue this downward trend through ongoing
operational improvements and improved institutional knowledge
building on two successful outdoor harvests.
- At the end of Q1, 48North had $2.2
million in cash and cash equivalents remaining, although the
Company has subsequently raised $3.45
million in equity and $3.25
million in a term loan since the end of Q1.
- 48North has continued leverage to its strong brand and
low-cost, high-quality production capabilities to respond to market
trends across Canada, and launched
Latitude, a brand with modern cannabis products ranging from
sexual wellness, to beauty, and beyond. Latitude has been
launching future-focused cannabis products across the country
including Sex Pot Intimacy Oil, Night Shift Ylany-Ylang Charcoal
Bath Salts, In Bloom CBD Lavender Chamomile Bath Salts. The Company
expects these products to contribute to its revenue increases in
the months ahead.
- Beyond this development, the Company has maintained a rigorous
focus on high-quality products and thought-provoking brands with
the launch of 28 SKUs nationwide since June
2019. Over this same time period, 48North has reported
steady increases in revenue each quarter.
- Looking ahead, 48North expects to renew its commitment to
high-quality products as strengthened production and manufacturing
capabilities continue to support revenue increases.
Events Subsequent to Q1 Fiscal 2021
- At Good:Farm, one of Canada's
first and largest outdoor cultivation facilities, 48North
successfully completed its second annual harvest. This year, the
Company used regenerative farming practices to drive down costs
while improving quality and has already commercialized its
outdoor-grown products at the Good:House, the Company's
state-of-the-art indoor processing, manufacturing, packaging, and
- Last year, a majority of Good:Farm cannabis was extracted into
distillate. This year's crop will serve a broader range of uses,
including dried flower, full-spectrum oils, and concentrate
products. The Company expects products from this year's harvest to
begin showing up on shelves beginning in December 2020.
- On November 10, 48North announced
a $3.25 million Secured Term Loan,
building on a $3.415 million private
placement offering with Cormack Securities Inc., increasing the
Company's cash since the end of Q1 Fiscal 2021. These funding
agreements better position the Company to execute its growth
strategy as it continues to move towards profitability.
"48North's Q1 Fiscal 2021 results provide us with another strong
demonstration that our strategy is working. Our innovative,
authentic brands continue to excite consumers and retailers alike
and we are evolving to meet growing demand by expanding our product
offering while improving operations and distribution," said
Charles Vennat, CEO of 48North. "Not
only are customers intrigued by our new products, but we are seeing
high rates of reorders. Having added to our cash position, and with
increasing revenues and decreasing quarterly cash use, we are
continuing to meet our targets and expect to be in a position to
announce our path to profitability within the fiscal year."
Selected Financial Information
All amounts are expressed in Canadian dollars
September 30, 2020
September 30, 2019
Basic and diluted
(loss) earnings per share
Cash and cash
First Quarter 2021 Results Conference Call
December 1, 2020 at 8:30 AM (ET)
Dial-in number: 1-888-231-8191
The conference ID is 5660299 and you will be prompted to provide
your name and company.
48North Cannabis Corp. (TSXV: NRTH) is a vertically integrated
cannabis company focused on manufacturing high-quality products,
building progressive and thought-provoking brands, and low-cost
cultivation. 48North is developing formulations and manufacturing
capabilities for its own proprietary products, as well as
positioning itself to contract manufacture similar products for
third parties. 48North operates Good:Farm, a 100-acre organic
cannabis farm which produces organically grown cannabis, securing a
significant first-mover advantage in the production of low-cost,
next-generation, extract-based cannabis products. In addition,
48North operates two indoor-licensed cannabis production sites in
Ontario. 48North cultivates unique
genetics at its wholly owned subsidiary, DelShen Therapeutics Corp.
("DelShen") and processes cannabis and manufactures next-generation
cannabis products at Good & Green Corp. ("Good & Green"),
both Licensed Producers under the Cannabis Act.
DISCLAIMER & READER ADVISORY
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release. Certain statements contained in this press release
constitute forward-looking information. These statements relate to
future events or future performance. The use of any of the words
"could," "intend," "expect," "believe," "will," "projected,"
"estimated" and similar expressions and statements relating to
matters that are not historical facts are intended to identify
forward-looking information and are based on the parties' current
beliefs or assumptions as to the outcome and timing of such future
events. Actual future results may differ materially. Please refer
to the Company's SEDAR filings for further details concerning the
risks associated with the Company's business. The forward-looking
information contained in this release is made as of the date hereof
and the parties are not obligated to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
applicable securities laws. Because of the risks, uncertainties and
assumptions contained herein, investors should not place undue
reliance on forward-looking information. The foregoing statements
expressly qualify any forward-looking information contained herein.
Public health crises, including the ongoing novel coronavirus
(COVID-19) pandemic, could have significant economic and
geopolitical impacts that may adversely affect the Company's
business, financial condition and/or results of operations.
SOURCE 48North Cannabis Corp.