CALGARY, AB, June 23, 2022 /CNW/ - CanadaBis Capital Inc. (the "Company" or "CanadaBis") (TSXV: CANB) a premium vertically integrated Canadian cannabis company, is pleased to announce record fiscal Q3 2022 financial results for the three and nine-month period ending April 30, 2022.

"The successful expansion of our overall product selection to date in 2022 coupled with strong sales growth across our integrated portfolio of brands supports the generation of meaningful profitability in 2022," said Travis McIntyre, CEO of Canadabis. "We are excited to carry this momentum throughout the balance of our fiscal year and beyond, maintaining our 'consumer-first' approach to drive growth while continuing to reduce costs across our supply chain, promoting sustained earnings. We feel the Company is well positioned to execute our strategy of building long term corporate sustainability, offering investors an extremely compelling opportunity to gain exposure to this exciting and evolving sector."

Q3/22 FINANCIAL HIGHLIGHTS: ANOTHER PROFITABLE QUARTER

• Continued Profitability in Q3/22 – Recorded a second consecutive profitable quarter, with net income of $123,137 compared to a net loss of $225,326 in the same period in 2021, attributable to increased sales of products derived from our butane hydrocarbon (BHO) extraction process, along with the introduction of several new SKUs (Stock Keeping Unit, a unique code that identifies a product).
  
  
• Record Gross Revenue – Gross revenue of $4.3 million in Q3/22 and $10.6 million in the nine-month period was a corporate record, increasing 64% and 81%, respectively, over the same periods in 2021. This reflects a 10% increase in quarter-over-quarter sales driven by stronger demand for new and existing SKUs, including those launched under our Dab Bod Brand into five provinces, along with continued demand for innovative products such as our High Priestess brand and Infuse pre-rolls.
  
  
• Positive Adjusted EBITDA[1] - Adjusted EBITDA¹ totaled $0.47 million in Q3 and was $1.04 million for the nine-month period in 2022, reflecting enhanced awareness of our brands, continued growth of the Dab Bod products and the launch of our new High Priestess brand, complemented by the Company's input cost reductions stemming from successful negotiations with cultivators.
  
  
• Higher Unit Sales and Brands Selling Out – During Q3/22, unit sales of combined concentrate and dry flower totaled more than 194,000, reflecting 66% growth over Q3/21. In addition, our Dab Bod and High Priestess brands have been well received by the market and increased orders from provincial purchasers have resulted in brands selling-out multiple times, a trend that is expected to continue through fiscal Q4/22 based on strong demand for products such as moon rocks, infused pre-rolls, live resin vapes and high CBD cartridges.
  
  
• Driving Down Input Costs – We have realized significantly reduced input costs and enhanced margins stemming from several areas. In addition to renegotiating material pricing with cannabis cultivators and other suppliers, a trend that is expected to continue into 2023 as incremental cultivators join the industry, we have also revised procedures in our production lines to better manage operational costs and we are receiving better pricing and terms when making higher volume bulk purchases.
  
  
• Aligning Products with Evolving Customer Preferences - We have continued to re-formulate our concentrate lines to align our offerings more closely with shifting customer preferences for larger terpene profiles.
  
  

QUARTERLY HIGHLIGHTS

Extraction and Tolling

Our Extraction and Tolling segment provides cannabinoid extraction services to other licensed producers and represented 91% of our total net revenue in Q3/22. Net revenue from this segment for the three and nine months ended April 30, 2022 was $2.6 million and $6.6 million, respectively, reflecting increases of 43% and 62% over the same periods in 2021. This growth is attributable to significantly increased sales from extract products in the provinces of Alberta, Ontario, Manitoba, Saskatchewan and British Columbia, driven in part by our product awareness campaign and the launch of several new SKUs that received extremely positive market reception.  Sales expansion has continued for flavoured infused pre-rolls, new flavours of our vapes under the NGL brand and our moon rocks products.

Cultivation and Wholesale

Net cultivation and wholesale revenue represented approximately 4% of total revenue in Q3/22, and was $59,144 and $346,454 for the three and nine-month periods ended April 30, 2022, respectively, reflecting growth of 18% and 214% over the corresponding periods in 2021. During the third quarter, this segment represented CanadaBis increased our pre-roll sales across all provinces.  Going forward, we intend to re-establish our presence of cultivating cannabis flowers in the Alberta market with our own premium bud, which is anticipated to launch in Q4/22 and position CanadaBis within a unique category of providing quality product at a lower price.

Retail Operations

With increased competition in the retail market following significant growth in retail stores across Alberta, our retail operations have experienced lower sales and fewer customers. In Q3/22, our net retail revenue was $154,061, representing approximately 5% of our total net revenue, reflecting a decline of 15% compared to the previous quarter. In light of this competitive landscape, we plan to continue rebranding ourselves and undertaking more aggressive marketing initiatives to increase market share and drive higher expectations for growth in Q4/22 and into 2023. 

CanadaBis has numerous competitive advantages we can leverage to support our long-term success in this expanding and evolving industry. Over the short-term, we plan to continue differentiating ourselves by virtue of our butane hydrocarbon (BHO) extraction process, which allows for the highly concentrated extraction of cannabis, producing some of the world's most potent marijuana concentrate. In addition, the Company continues to undertake exploratory work to formulate various new concentrate products to meet the demands of our customers and help diversify our sales offerings into a competitive marketplace 

The Company's positive sales performance in Q3/22 is expected carry forward into the next quarter based on sustained high demand and increased purchase orders on our new products such as moon rocks, infused pre-rolls, live resin vapes and high CBD cartridges. Given our position as a vertically integrated Cannabis company, we intend to continue introducing new Canadian concentrate products under our own, as well as third-party brands, while establishing our presence as an in-demand Licensed Producer with unique abilities and maneuverability. Further, we will continue to support education initiatives within the industry to help consumers better understand how cannabis products integrate into daily life and the various use cases. We remain excited about the opportunity to continue capturing market share using our diverse portfolio of brands, our unique products and services and our ability to benefit from ongoing industry developments.

CanadaBis Capital Inc. (TSXV:CANB) is a vertically integrated Canadian cannabis company focused on achieving large-scale growth, from cultivation to retail, in the fast-emerging global cannabis market. By targeting organic growth opportunities alongside the right-fit partners, we remain focused on finding and capitalizing on chances to grow, diversify and continue to lead our industry.

Our integrated subsidiaries:

• Stigma Pharmaceuticals Inc. – 100% held
• 1998643 Alberta Ltd. (operating as "Stigma Grow") - 100% held; www.stigmagrow.ca
• Full Spectrum Labs Ltd. (operating as "Stigma Roots") - 100% held
• 2103157 Alberta Ltd. (operating as "INDICAtive Collection") -100% held; www.indicativecollection.ca
• Goldstream Cannabis Inc. - 95% held

Stigma Grow is a cutting-edge cannabis cultivation and extraction company positioned advantageously to meet the unmet market demands and stigmas within the legal cannabis industry head on, with products designed to disturb the status quo and dramatically shift the conversation surrounding Canada's legal cannabis industry.

Non-GAAP Measures

This news release contains the financial performance metric of Adjusted EBITDA, a measure that is not recognized or defined under IFRS (a "Non-GAAP Measure"). As a result, this data may not be comparable to data presented by other cannabis companies. For an explanation and reconciliation of Adjusted EBITDA to related comparable financial information presented in the Financial Statements prepared in accordance with IFRS, refer to the MD&A for the three and nine months ended April 30, 2022. The Company believes that Adjusted EBITDA is a useful indicator of operational performance and is specifically used by management to assess the financial and operational performance of the Company.

Adjusted EBITDA is a measure of the Company's financial performance. It is intended to provide a proxy for the Company's operating cash flow and is widely used by industry analysts to compare CanadaBis to its competitors and derive expectations of future financial performance of the Company. Adjusted EBITDA increases comparability between comparative companies by eliminating variability resulting from differences in capital structures, management decisions related to resource allocation, and the impact of fair value adjustments on biological assets, inventory, and financial instruments, which may be volatile on a period-to-period basis. Adjusted EBTIDA is not a recognized, defined, or standardized measure under IFRS. The Company calculates Adjusted EBITDA as net income (loss) and comprehensive income (loss) excluding changes in fair value of biological assets, change in fair value of biological assets realized through inventory sold, depreciation and amortization expense, share-based payments, and finance costs.

Regarding Forward-Looking Information

This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include but are not limited to statements with respect to our business and operations; timing of the Sundial products coming to market; the demand and market for live-resin vape cartridges, and our general business plans. Forward-looking statements are necessarily based upon a number of assumptions including: the ability of the Company's products to compete with the pricing and product availability on the black-market; the market demand for the Company's products; and assumptions concerning the Company's competitive advantages. These assumptions, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: compliance with extensive government regulation, the general business, economic, competitive, political and social uncertainties; ability to sustain or create a demand for a product; requirement for further capital; delay or failure to receive board, shareholder or regulatory approvals; the results of operations and such other matters as set out in the Company's continuous disclosure on SEDAR at www.sedar.com. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.

Accordingly, readers should not place undue reliance on forward-looking statements. Investors are cautioned that forward-looking information is not based on historical facts but instead reflects management's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although we believe that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have a material adverse effect on our future results, performance or achievements.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE CanadaBis Capital Inc.

View original content to download multimedia: http://www.newswire.ca/en/releases/archive/June2022/23/c5161.html