Mr. Eric Offenberger reports

VEXT REPORTS FINANCIAL RESULTS FOR Q2 2023 AND PROVIDES UPDATE ON OHIO ACQUISITION

Vext Science Inc. has released its financial results for the period ended June 30, 2023. All currency references used in this news release are in United States currency unless otherwise noted.

Management commentary

Eric Offenberger, chief executive officer of Vext, commented: "During Q2, our team's efforts to drive more traffic with targeted promotions and a broad selection of value-based products were successful, and led to gains in market share in a challenging environment. We made the strategic choice to accept lower gross margins in Q2, in order to generate a return on the product from our recently idled outdoor grow, as pricing remains under pressure due to overcapacity in the market. We are well positioned from a vertical perspective, with indoor capacity from our Eloy facility picking up the slack and ensuring we are matching demand at our owned retail locations with our own internal supply. We expect gross margins to progressively recover through the second half of Q3 and in Q4, on the way back to more normalized levels. This quarter marked our 13th consecutive quarter of reporting positive EBITDA [earnings before interest, taxes, depreciation and amortization] and positive adjusted EBITDA, demonstrating our ongoing commitment to generating profitability, while prudent working capital management contributed to robust cash flow from operations of $3.4-million through the quarter."

Mr. Offenberger continued: "Operations in Ohio continue to track well over the second quarter. We have received regulatory approval and remain on track to close the Ohio acquisition by the end of August, enabling us to add a fully operational vertical footprint in the state. The Ohio market continues to expand, with patient count up 23 per cent in June, 2023, as compared to the same period last year. We view Ohio as a very attractive growth opportunity, with its limited licence structure and the recreational use initiative making Ohio's November ballot. Through the combination of our strong balance sheet and strategic positioning in two limited licence states, we expect to continue generating profitability and shareholder value through the remainder of the year, and through 2024."

Update on Ohio acquisition

The company also announces that it has received the approval of the Ohio Department of Commerce for the ownership transfer of Appalachian Pharm Processing LLC, an Ohio limited liability company, together with its subsidiaries and affiliated companies (collectively, APP), pursuant to the company's previously announced acquisition of APP for a total consideration of approximately $12.5-million, with $11-million paid in cash or promissory notes, and $1.5-million through the issuance of common shares of Vext. The company is working with APP to satisfy the remaining conditions of closing and currently expects that closing of the Ohio acquisition will occur prior to the end of August, 2023, subject to the terms of the definitive purchase agreements. For further details about the terms of the Ohio acquisition, see the company's news release dated Dec. 15, 2022.

As a result of closing of the Ohio acquisition, Vext will also obtain the right to acquire ownership of a cannabis dispensary in Columbus, Ohio. The company has applied to the Ohio Board of Pharmacy for an ownership transfer of such dispensary, and expects to receive approval this year and to close promptly after receipt of regulatory approval.

Summary of recent announcements:

• On Aug. 10, 2023, the company announced that Stephan Bankosz has resigned as chief financial officer and corporate secretary of the company, effective Aug. 25, 2023, to pursue other opportunities. Vext will appoint experienced financial executive and operator Trevor Smith as CFO. Nalee Pham, the company's chief of staff and a director of the company's wholly owned operating subsidiary, Herbal Wellness Center LLC, has been appointed corporate secretary.

Q2 2023 financial results conference call

Vext will host a conference call and webcast on Wednesday, Aug. 23, 2023, at 8 a.m. ET to discuss its second quarter financial results.

Date:  Aug. 23, 2023

Time:  8 a.m. ET

Participant dial-in:  416-915-3239 or 1-800-319-4610

Replay dial-in:  1-800-319-6413

Conference ID:  10022320

Playback No.:  0372 (expires on Sept. 6, 2023)

Webcast:  access on-line

For more details, visit Vext's investor website or contact the investor relations team at investors@vextscience.com.

About Vext Science Inc.

Vext Science is a United States-based cannabis operator with vertical operations in Arizona and Ohio. Vext's expertise spans from cultivation through to retail operations in its key markets. Based out of Arizona, Vext owns and operates state-of-the-art cultivation facilities, fully built-out manufacturing facilities, as well as dispensaries in both Arizona and Ohio. The company manufactures Vapen, one of the leading THC (tetrahydrocannabinol) concentrates, edibles and distillate cartridge brands in Arizona. Its selection of award-winning products are created with Vext's in-house, high-quality flower and distributed across Arizona and Ohio, as well as through Vext's partnerships in other states. Vext's leadership team brings a proven record of building and operating profitable multistate operations, with the company having operated profitably since 2016. The company's primary focus is to continue growing in its core states of Arizona and Ohio, bringing together cutting-edge science, manufacturing and marketing to provide a reliable and valuable customer experience while generating shareholder value.

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