Mr. Jeff Swainson reports

SIMPLY SOLVENTLESS PROVIDES UPDATE ON HUMBLE GROW CO. RETROFIT & STATUS OF PAST ACQUISITION INTEGRATIONS AND COST SAVINGS

Simply Solventless Concentrates Ltd. has provided updates regarding its previously announced cultivation facility retrofit by its wholly owned subsidiary, Humble Grow Co., and the integration of past acquisitions and related cost savings achieved.

Humble retrofit

Jeff Swainson, Simply Solventless's president and chief executive officer, stated: "All Humble retrofit LED lights have now been ordered from existing working capital sources, and we will provide definitive installation timelines as we progress. Preliminary schedules suggest 100-per-cent retrofit production by early Q3 2026, and once this run rate is achieved, SSC's annual gross revenue is expected to increase by $17.5[-million] to $29.5-million to $53.5[-million] to $65.5-million. With Humble fixed costs remaining consistent with preretrofit levels, most incremental gross margin is expected to flow to the EBITDA line, increasing SSC's annual adjusted EBITDA by $6.5[-million] to $14.5-million to $10.7[-million] to $18.7-million."

Mr. Swainson continued: "This $1.5-million net capital investment is expected to provide material increases to revenue, adjusted EBITDA and cash flow, and with a payback period of less than one year, we are excited to capture this return on investment for our shareholders. Postretrofit, Humble is expected to be one of the only large-scale, high-quality indoor cultivation assets capable of underpinning a leading position in Canadian cannabis, and with almost all such assets currently owned by the major Canadian licensed producers, SSC will be uniquely positioned among junior Canadian licensed producers."

Humble has gathered two years of data regarding the efficacy of a retrofit at its 98,000-square-foot facility located in Winnipeg, Man. The retrofit uses the existing floor plan and comprises a lighting change to LED, table placement changes, additional irrigation, installation of dehumidifiers and alterations to air circulation. These changes triple light intensity and provide more consistent lighting, better nutrient uptake, and superior humidity and air circulation. The capital cost for the retrofit is approximately $2.5-million ($1.5-million net of expected government rebates).

All of Humble's flower is currently sold every month on a B2B (business-to-business) basis to other licensed producers (LPs). This flower services the international and domestic recreational cannabis markets (consumer packaged goods).

50-per-cent B2B and 50-per-cent CPG Humble retrofit financial projections

SSC has taken steps to expand its markets in anticipation of incremental retrofit production. Post retrofit, SSC will continue to service the B2B market domestically and internationally, and it expects to also participate in the recreational cannabis market on a CPG basis with its own brands. Assuming a sales mix of 50-per-cent B2B and 50-per-cent CPG, annualized financial projections by case are shown in the attached table.

Acquisition Integration and cost savings update

Over the past 18 months, Simply Solventless completed four acquisitions. See Simply Solventless's MD&A (management's discussion and analysis) for the three and nine months ended Sept. 30, 2025, for further information regarding these acquisitions, which is available on Simply Solventless's SEDAR+ profile.

As of December, 2025, the integration of these acquisitions is substantially complete.

Aggregate of each entity's headcount and payroll on the date of each respective acquisition.

Mr. Swainson continued: "SSC has achieved an estimated $7.8-million in annual payroll cost savings (44 per cent) when comparing pre and postacquisition levels. SSC's thesis was that consolidation would result in significant synergies and cost savings, and this has now been proven. We are encouraged by the impact that these cost savings will have on our future operations with baseline revenue levels now achieved."

About Simply Solventless Concentrates Ltd.

Simply Solventless is a public company incorporated under the Business Corporations Act (Alberta). Simply Solventless's mission is to provide pure, potent, terpene-rich, ready-to-consume cannabis products to discerning cannabis consumers.

We seek Safe Harbor.