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Cubicfarm Systems loses $7.63-million in fiscal 2019

2019-11-14 18:56 ET - News Release

Mr. Dave Dinesen reports


Cubicfarm Systems Corp. has released its financial and operating results for the year ended June 30, 2019.

Key financial highlights:

  • Revenue for the year ended June 30, 2019, was $5,356,031, of which revenue from systems sales was $5,201,198 and revenue from other sales was $154,833. The company did not record any revenues from systems sales during the year period ended June 30, 2018.
  • Gross margin for the year ended June 30, 2019, was $1,279,198 (24 per cent) and nil for the year ended June 30, 2018.
  • Selling expenses, which include commissions and freight, were $127,211 compared with $21,041 for the year ended June 30, 2018.
  • Net loss and comprehensive loss for the year ended June 30, 2019, were $7,630,624 or 11 cents per share, compared with $1,394,896 or two cents per share in the same period of the previous year.

Operational highlights:

  • During the year ended June 30, 2019, Cubicfarm sold and installed four systems: (i) a 14-machine system at Swiss Leaf Ltd., Calgary, Alta.; (ii) a 14-machine system at Del Fresco Produce Ltd., Kingston, Ont.; (iii) a seven-machine system at Nu Skin Enterprises Inc., Vineyard, Utah; and (iv) a one-machine system to Zenabis Global Inc., Langley, B.C.
  • In September, 2018, the company deployed its first operational 11-machine system at its Pitt Meadows site in British Columbia. It serves as a research and development facility and a sales demonstration system.
  • In October, 2018, the company began delivering produce from its Pitt Meadows system to local grocery stores under the company's trademarked produce brand Thriiv Local Garden.
  • In December, 2018, the company signed a system sale agreement and received a deposit from its customer for a 12-machine system in the greater Vancouver area in British Columbia.
  • In January, 2019, the company executed a binding term sheet with Nu Skin that outlines the business arrangement under which Nu Skin and the company intend to market and sell Cubicfarm systems in China.
  • In January, 2019, the company and Zenabis agreed to terminate their joint venture agreement and replace it with a licence agreement. This licence agreement provides Zenabis with exclusive access to the company's technology for cannabis so long as Zenabis satisfies annual machine purchase thresholds.

Cubicfarm chief executive officer Dave Dinesen commented: "We are very excited for our future at Cubicfarm. The last year has been an investment-heavy year for us, setting us up for this year's focus on sales and growth. We have heavily invested in strengthening our management team, expanding our crop varieties to be able to capture more verticals in the fresh produce, animal feed, hemp/cannabis and nutraceutical ingredients space, and expanding our international sales pipeline.

"Recent developments, such as increasingly large machine orders and the signing of our first global reseller arrangement to augment our own sales and marketing efforts, position us well to meet our vision of driving sales by constantly innovating through increased automation and expansion of verticals served in the market."

Cubicfarm's year-end financial statements and management's discussion and analysis will be issued and filed on SEDAR on Nov. 14, 2019, and will be available on the same day on Cubicfarm's website.

About Cubicfarm Systems Corp.

Cubicfarm is an agricultural technology company commercializing large-scale, vertical farming solutions for global industrial markets. Founded in 2015, the company's mission is to provide industries around the world with efficient growing systems capable of producing predictable crop yields. Cubicfarm offers turnkey, commercial-scale, hydroponic, automated vertical farm growing systems that can grow predictably and sustainably for 12 months of the year virtually anywhere on earth.

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