They made mor in the last quarter than they did all last year. When looking at the loss don’t have a heart attack. The loss was just a write down of the “goodwill” from the purchase of Emblem and another company. Like Mr Wonderful says “ you can not expect a new company to have a good balance sheet. Show me an increase in revenue quarter over quarter and year over year and I am happy. This makes me happy with my investment choice and Im glad Im in early.
03/25/2021 07:16 AM ET
* Press Release: Aleafia Health Reports 2020 Year End Results, Record Quarterly Revenue
Aleafia Health Reports 2020 Year End Results, Record Quarterly Revenue
-- 233% increase in Q/Q cannabis net revenue
-- $4.3 million positive adjusted EBITDA in Q4 2020
-- 42% and 501% increase in Q/Q medical cannabis and adult-use net revenue,
respectively
-- Significant product portfolio expansion with 31 new SKUs launched since
October
TORONTO, March 25, 2021 (GLOBE NEWSWIRE) -- Aleafia Health Inc. (TSX: AH, OTC: ALEAF) ("Aleafia Health" or the "Company") is pleased to report its financial results for the 2020 fourth quarter ("Q4 2020") and fiscal year ("FY 2020").
"Following the successful licensing of all three of our production facilities in 2020, we've now introduced innovative new cannabis derivative and dried flower formats under a distinct and compelling brand family," said Aleafia Health CEO Geoffrey Benic. "Our expanded product portfolio is having an immediate impact, with record quarterly revenue and strong sequential growth in our priority adult-use, medical and international cannabis sales."
"Notwithstanding certain non-cash, one-time expenses, our focus on disciplined, profitable growth has paid dividends with our first year of positive adjusted EBTIDA. The commercialization of our business is rapidly accelerating with the shift in revenue mix towards the sale of highly profitable packaged cannabis products providing a sustainable source of continued growth."
CONDENSED INCOME (LOSS) STATEMENT
Three months ended Year ended
Dec
Dec 31, Sep 30, 31, Dec 31, Dec 31,
($,000s) 2020 2020 2019 2020 2019
Net revenue 15,203 4,967 6,028 44,542 16,351
Cannabis net
revenue(1)(3) 14,122 4,244 4,852 41,088 11,628
Adjusted gross
profit before
fair value
("FV")
adjustments on
net cannabis
revenue 8,365 355 3,864 23,357 4,884
Adjusted gross
margin before
FV adjustments
on net
cannabis
revenue((1) 59% 8% 80% 57% 42%
Selling,
general &
administrative
expenses
("SG&A") 7,909 6,737 5,924 29,248 30,553
Gross profit (3,867) (10,001) 5,542 (5,610) 20,782
Adjusted
EBITDA(1)(2) 4,320 (5,153) (763) 8,996 (19,574)
--------------- -------- ------- ------ -------- -------
Net loss (217,301) (19,762) (9,759) (247,238) (39,607)
-------- -------
1. See "Cautionary Statements Regarding Certain non-IFRS
Measures" section of associated MD&A for term definition.
2. See "Adjusted EBITDA" section for reconciliation
to IFRS equivalent.
3. See "Revenue" section for reconciliation to IFRS
equivalent.
ADJUSTED EBITDA & NET INCOME
Three months ended Year ended
Dec 31, Sep 30, Dec 31, Dec 31, Dec 31,
($,000s) 2020 2020 2019 2020 2019
----------------- --------- -------- ------- --------- ----------
Net loss (217,301) (19,762) (9,759) (247,238) (39,607)
Deferred income
tax expense
(recovery) 2,854 (4,394) 3,616 (2,540) 2,959
Share-based
payments 582 648 929 2,690 13,512
Business
transaction
costs 824 816 1,630 4,146 5,212
Depreciation and
amortization((1) 2,651 3,273 2,200 10,166 5,912
Bad debt expense 988 500 - 1,892 -
Interest expense 3,098 3,062 1,661 11,636 5,959
FV changes in
biological
assets and
changes in
inventory sold 11,106 10,708 (1,041) 29,133 (13,219)
Intangible asset
write-down 22,116 - - 22,116 -
Goodwill
write-down 177,476 - - 177,476 -
Non-operating
expense
(income) (74) (4) (1) (481) (302)
------
Adjusted
EBITDA((2) 4,320 (5,153) (763) 8,996 (19,574)
----------------- -------- ------- ------ -------- -------
1. Q4 2020 includes $2.1M non-cash depreciation expensed
to cost of sales.
2. See "Cautionary Statements Regarding Certain non-IFRS
Measures" section of associated MD&A for term definition.
CANNABIS OPERATIONAL RESULTS
Q4 2020 Q3 2020 Q4 2019 FY 2020 FY 2019
--------------------------------- ------- ------- ------- ------- -------
Cannabis net revenue(1)(2) 14,121 4,245 4,852 41,088 11,628
Net medical cannabis
revenue(1)(2) 2,717 1,909 1,731 7,950 4,361
Net adult-use cannabis
revenue(1)(2) 1,409 235 554 3,221 4,116
Net bulk wholesale cannabis
revenue(1)(2) 9,995 2,101 2,805 29,915 3,390
Active, registered patients 18,740 17,526 10,249 - -
------- -------
1. See "Cautionary Statements Regarding Certain non-IFRS
Measures" section of the associated MD&A for term
definition.
2. See "Revenue" section of the associated MD&A for
reconciliation to IFRS equivalent.
-- Medical cannabis net revenue for Q4 and FY 2020 was $2.7 million and $8.0
million, an increase of 57% and 82%, respectively, over the same periods
in the prior year. The increase was primarily due to improved product
offerings and a continued increase in the Company's total number of
active, registered patients. Management believes that the Company's broad
medical cannabis ecosystem, which includes clinics and scheduled same day
delivery, in addition to cannabis products, provides the company with a
core competitive advantage.
-- Net adult-use cannabis revenue for Q4 and FY 2020 was $1.4 million and
$3.2 million, respectively, compared to $0.6 million and $4.1 million for
the same periods in the prior year, and $0.2 million during the three
months ended September 30, 2020 ("Q3 2020"). The sequential increase was
primarily due to greater product availability, including the launch of
new product formats and SKUs.
-- Net bulk wholesale revenue received from sales to cannabis licensed
producers (each an "LP") for Q4 and FY 2020 was $10.0 million and $29.9
million, an increase of 256% and 783% respectively, over the same periods
in the prior year. The increase was primarily due to the sale of flower
harvested at the Port Perry Facility's outdoor cultivation site to other
LPs, and a larger harvest in 2020 relative to the prior year, yielding
31,200 kgs of dried flower.
Adjusted EBITDA for Q4 and FY 2020 was $4.3 million and $9.0 million compared to losses of $0.8 million and $19.6 million, respectively, in the same periods in 2019, and a sequential improvement of $9.4 million over the previous quarter. The substantial difference in quarterly adjusted EBITDA reported over the course of 2020 is primarily due to the seasonality of outdoor cultivation associated sales, which provide a substantial contribution margin. Bulk wholesale revenue fluctuated significantly over the course year, which significantly effects adjusted EBITDA and net income or loss.
Net loss for Q4 and FY 2020 was $217.3 million and $247.2 million, compared to losses of $9.8 million and $39.6 million in the same periods in 2019. In both Q4 and FY 2020, the net loss was primarily due to non-cash items including a fair value changes in biological assets and changes in inventory sold expense of $11.1 million for the quarter and $29.1 million for the full year. Included in the full year amount is a $17 million write-down to net realizable value of saleable inventory to reflect declining wholesale prices.
During Q4 2020, the Company incurred a $22.1 million write-down of intangible assets expense. This includes a $10.6 million write-off associated with the Company's 51% interest in the Flying High Brands joint-venture, as the Company is now primarily developing its brands and products in-house, rather than licensing them from other cannabis companies.
The Company also wrote-down $176.0 million of goodwill associated with the acquisition of Emblem Corp., and $1.4 million of goodwill associated with the acquisition of Canabo Medical Corp.
PRODUCT PORTFOLIO & SALES GROWTH
With the receipt of necessary Health Canada licences received earlier in 2020, the Company began the development and production of a number of new product formats and existing line extensions, with launches commencing in Q4 2020. The launches have resulted in an increase of 31 cannabis products SKUs since October, directly impacting the increased sales in both markets.
-- Sublingual Strips: Kin Slips, the cannabis-infused sublingual strips,
launched in Q4 2020 in the medical and adult-use markets. Kin Slips
offers a fast onset time relative to other non-combustible cannabis
products. Placed under the tongue, the active ingredients enter the
bloodstream through the sublingual gland, delivering a typical onset time
of 10 to 15 minutes (though individual experience may vary).
-- 510 Vape Cartridges: The vapes are inspired by Aleafia Health's signature
cultivars and contain custom-made, unique terpene blends deliver robust
flavours and consistent effects. They contain CO2-extracted distillate
mixed with a custom blend of botanically sourced terpenes. No fillers or
artificial flavours are used in the vapes, which were launched in Q4
2020.
(MORE TO FOLLOW) Dow Jones Newswires
March 25, 2021 07:16 ET (11:16 GMT)
Press Release: Aleafia Health Reports 2020 Year -2-
-- Confectionary Edibles: Subsequent to the reporting period, the Company
released THC soft chews, its first cannabis edible product. Soft chews
are currently the largest edibles category in Canada, as they are in
other international jurisdictions with a more established legal adult-use
cannabis market. The initial launch features two SKUs, each with two five
milligram chews per package. The Company is currently considering a soft
chews line extension to include additional flavours, and a CBD dominant
offering.
-- High Potency CBD Oil: In December, the Company launched a high potency
cannabis oil, CBD 50, with 50 mg per millilitre of CBD oil, provides
greater consumer and patient convenience and has more than twice the
potency of traditional high CBD oils.
-- Exclusive Cultivars: The Company's medical cannabis patients now benefit
from access to highly sought-after strains through its supply agreement
with cannabis brands house Robes Cannabis Inc. (dba as BLLRDR). As part
of this agreement, subsequent to the reporting period, the Company
launched the Afghani Bullrider and Wedding Cake strains each in 3.5 gram
containers.
-- Dried Flower at Scale: Leveraging the greater scale of cultivation
capacity, the Company has also expanded upon its signature strains with
greater product availability, and new larger format SKUs, including a
pre-roll line extension with 12 pre-rolls each of 0.35 grams. Initial
purchase orders for this and other new dried flower SKUs have commenced
shipping to adult-use provincial wholesalers beginning in March.
CONFERENCE CALL & WEBCAST
Date: March 25, 2021
Time: 8:30 a.m. EST
USA/Canada Toll-Free Participant Call-in: (866) 679-9046; Passcode: 3497836
International Toll-Free Participant Call-in: (409) 217-8323; Passcode: 3497836
WEBCAST LINK
This conference call will be webcast live over the internet and can be accessed through the link provided. Audio of the call will be available to participants through both the conference call line and webcast; however, the presentation may only be viewed via the webcast. Participants who miss the live call can view a replay at any time via the link provided.
For Investor & Media Relations:
Nicholas Bergamini, VP Investor Relations
1-833-879-2533
IR@AleafiaHealth.com
LEARN MORE: www.AleafiaHealth.com
About Aleafia Health:
