Mr. Raj Grover reports
HIGH TIDE REPORTS SECOND QUARTER 2020 FINANCIAL RESULTS
High Tide Inc. has released its financial and operating results for the second quarter of fiscal 2020 ending April 30, 2020.
Second quarter 2020 -- financial highlights:
Revenue for the three months ended April 30, 2020, increased by 197 per cent to $19.57-million from $6.60-million for the same quarter last year.
- Gross profit for the three months ended April 30, 2020, increased by 214 per cent to $7.39-million from $2.35-million for the same quarter last year.
- Gross profit margin for the three months ended April 30, 2020, increased to 38 per cent from 36 per cent for the same quarter last year.
Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the three months ended April 30, 2020, increased by 156 per cent, to $1.94-million from an adjusted EBITDA loss of $3.49-million for the same quarter last year.
- Cash and cash equivalents as at April 30, 2020, increased to $7.04-million from $810,000 as at Oct. 31, 2019.
"The second fiscal quarter of 2020 marks a historic moment in High Tide's history. I am fiercely proud of our team for delivering adjusted EBITDA well ahead of the company's peer group and positive cash flow from operations through their unwavering commitment to our core strategy, especially throughout the pandemic. A decade of experience with cannabis consumers has been the key ingredient to our substantial year-over-year increase in revenue and enhanced gross margin," said Raj Grover, president and chief executive officer. "We are grateful to the many customers, employees, shareholders and other stakeholders who believed in High Tide's vision and today share in our success. We remain focused on continuing to strengthen our balance sheet and delivering value by furthering our retail expansion across Ontario. I am confident that our future results will continue to reinforce our position as a leading cannabis operator," added Mr. Grover.
Second quarter 2020 -- operational highlights:
The company successfully acquired and integrated the branded Canna Cabana locations in Hamilton and Sudbury.
The company further developed its Saskatchewan retail presence by acquiring a licensed cannabis retail location in Tisdale, Sask.
- High Tide entered into an agreement with Halo Labs to sell its KushBar assets for $12-million, subject to the required regulatory approvals.
- The company opened a Canna Cabana store in the heart of downtown Edmonton, Alta.
- Integration of the Grasscity e-commerce platform into High Tide's Las Vegas facility has resulted in continued growth of North American market share and daily transaction volume.
Through the COVID-19 pandemic existing Canna Cabana locations have remained operational and efficient, despite the challenging conditions facing retail across the country.
- As of the date of this news release approximately 47,000 members have joined Cabana Club, with 55 per cent of the company's average daily transactions conducted by club members.
To date, the company's portfolio includes a total of 36 branded retail cannabis locations in Ontario, Alberta and Saskatchewan.
The company opened a KushBar store in Medicine Hat, Alta.
- The company opened four new Canna Cabana retail locations in Ontario: Niagara Falls, Toronto -- Parliament, Burlington, and Toronto -- Bayview Avenue, bringing the current total to seven Ontario stores and achieving 9-per-cent provincial market share by location as of June 9, 2020.
SELECTED FINANCIAL INFORMATION FOR THE THREE AND SIX MONTHS ENDED APRIL 30, 2020
(expressed in thousands)
Three months Six months
ended April 30 ended April 30
2020 2019 2020 2019
Revenue $19,572 $6,596 $33,231 $11,596
Gross profit 7,388 2,351 12,165 4,140
Total operating expenses 7,331 6,702 14,051 13,352
Adjusted EBITDA(a) (loss) 1,935 (3,486) 1,385 (6,823)
Income (loss) from operations 57 (4,351) (1,886) (9,212)
Net (loss) (5,046) (3,319) (8,898) (7,140)
(Loss) per share (basic) (0.02) (0.02) (0.04) (0.04)
(Loss) per share (diluted) (0.02) (0.02) (0.04) (0.04)
High Tide remains focused on the fundamentals of profitable retail, while continuing to leverage cannabis and its related accessories through the company's manufacturing and e-commerce portfolio. High Tide's diverse mix of consumer channels provides access to layered insights and context unavailable to competitors, providing the company with an advantage in understanding the development of North American and global cannabis user preferences in real time.
The company believes that the senior secured credit facility advanced by Windsor Capital, the proceeds from the sale of the common shares of Halo Labs, and achieving positive cash flow from operations has positioned High Tide to execute on its strategic growth objectives in 2020. The company is well positioned and financed to further its expansion in Ontario, as Canada's largest and most underserved market.
About High Tide Inc.
High Tide is a retail-focused cannabis company enhanced by the manufacturing and distribution of cannabis lifestyle accessories. With portfolio subsidiaries, including Canna Cabana Inc., KushBar Inc., Grasscity.com, CBDcity.com, RGR Canada Inc. and Famous Brandz Inc., High Tide has a strategy as a parent company to extend and strengthen its integrated value chain while providing a complete customer experience and maximizing shareholder value.
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