Mr. Randy Ko reports

HEMPSANA ANNOUNCES Q1 2023 FINANCIAL RESULTS

Hempsana Holdings Ltd. has released first quarter financial results for the three-month period ended March 31, 2023.

Randy Ko, Hempsana's chief executive officer, commented: "Hempsana continues to expand its innovative product offerings to consumers across Canada with the launch of seven new SKUs from Ufeelu and two new brands, Caviar Gold and Craft Bangers. We believe that Caviar Gold and Craft Bangers will provide great dried flower options that have high [tetrahydrocannabinol] potency (greater than 25 per cent) combined with high terpene profiles (greater than 4 per cent). We believe we have the opportunity to dominate the infused preroll market as we use a patented process to infuse our prerolls and moonrocks that provides consumers a consistent smoking experience as the patented process uniformly distributes the distillate into the flower. The main complaint that consumers have in the market today is that the infused prerolls do not burn consistently, and that is what we have focused on, bringing to market superior infused preroll quality that allow users to enjoy a smooth and consistent smoking session just as they do with non-infused prerolls."

Operational highlights

New unique and innovative products

The company launched a total of seven new products in various provinces in the first quarter:

• Caviar Gold:
  • Ice Cube's Fryday kush distillate infused moonrock (45 to 50 per cent THC, two grams);
  • Apple Drip OG distillate infused preroll (45 to 50 per cent THC, 1.3 grams);
• Craft Bangers:
  • Tiki Head Hunter 3.5- and seven-gram dried flower (sativa with 4 per cent terps);
  • Tiki Head Hunger one-gram preroll (sativa with 4 per cent terps);
  • Pablos Revenge seven-gram dried flower (indica with cannabigerol and 5 per cent terps);
  • Kush Hunter distillate infused preroll (35 per cent THC with Pablo's Revenge strain);
• Ufeelu -- Rest Drops (cannabidiol/cannabinol).

Financial highlights:

• Net revenues were $363,831 for the three months ended March 31, 2023, compared to $354,855 for the three months ended March 31, 2022.
• Higher revenues from contract manufacturing services offset lower product sales in Q1 2023.
• Q1 2023 revenues were 28 per cent lower than fourth quarter 2022 revenues of $528,487. Q4 2022 had a few larger product sales that did not occur in Q1 2023.
• Net loss and comprehensive loss were $276,515 in Q1 2023 compared with a net loss of $242,375 in Q1 2022.
• The higher net loss in Q1 2023 reflects higher operating expenses, wages, and legal and professional fees, offset by lower management fees.
• Net loss per share was one cent in Q1 2023, similar to the one-cent net loss per share in Q1 2022.
• Subsequent to March 31, 2023, the company announced a private placement financing of $900,000.

Resignation of director

Douglas Sommerville has announced that, due to other personal commitments, he has resigned as a director of the company and would not seek re-election at the coming annual general meeting.

Mr. Ko commented: "Doug has served as chair of the board of directors since the company went public in 2021. Over this time, he made many contributions to the success and growth of the company, drawing on a wealth of experience gained over a long and successful business career. On behalf of the board of directors, the management team and our shareholders, I thank Doug, and wish him and his family all the best in the future."

About Hempsana Holdings Ltd.

The company's business involves the manufacturing of cannabis derivatives and the producing of cannabis extracts for use in finished products, including vapeables, topical creams and infused consumables. Hempsana's Health Canada standard processing licensed and European good manufacturing practice compliant facility provides the company with access to wholesale and retail channels in Canada and internationally.

We seek Safe Harbor.