PR Newswire
VAUGHAN, ON, April 22, 2019
VAUGHAN, ON, April 22, 2019 /PRNewswire/ - CannTrust Holdings Inc. ("CannTrust" or the "Company", TSX:TRST, NYSE:CTST) today released preliminary operational and financial results for the quarter ended March 31, 2019.
"These preliminary results represent the excellent efforts the CannTrust team has made in increasing output at our Niagara perpetual harvest greenhouse. We are quickly approaching our stated capacity of 50,000kg per year from our Phase 2 expansion. Our 96% sequential increase in production over the prior quarter will enable us to service both our rapidly growing base of medical patients and the high demand in the recreational market for our award-winning products and brands." said Peter Aceto, Chief Executive Officer. "We expect gross margins between 42% to 46% in the first quarter of 2019, and plan to deliver continued improved profitability as our volumes increase, as we make targeted price increases and as we realize the benefits of our low-cost high quality production strategy."
Operational Highlights
Operational highlights for the quarter ended March 31, 2019 and subsequent period are as follows:
Three months ended | |||
March 31, 2019 | December 31, 2018 | March 31, 2018 | |
Average revenue per dry gram | $5.57 | $4.89 | $7.27 |
Average revenue per ml extract | $1.91 | $1.72 | $1.94 |
Financial Highlights
CannTrust has not yet completed the financial close process for the quarter ended March 31, 2019. The Company's independent registered public accounting firm has not completed its review of the results for the quarter ended March 31, 2019. Set forth below are certain preliminary estimates of the results of operations that the Company expects to report for its first quarter of 2019. Actual results may differ materially from these estimates due to the completion of the financial closing procedures, final adjustments and other developments that may arise between now and the time the financial results for the first quarter are finalized.
The results for the quarter ended March 31, 2018, have been restated to conform to the current period presentation and reflect the accounting policy change adopted in the quarter ended September 30, 2018.
The following are preliminary estimates for the quarter ended March 31, 2019:
Calculation of Adjusted EBITDA | Three Months Ended | ||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | |||
$000s | $000s | $000s | |||
Net income before taxes | 13,000 | (28,847) | 11,442 | ||
Fair value changes in biological assets included in inventory sold | 6,200 | 84 | 4,444 | ||
Unrealized loss (gain) on changes in fair value of biological assets | (26,800) | 13,876 | (20,495) | ||
Share based compensation | 3,200 | 1,568 | 3,631 | ||
Other loss (income) | (1,400) | 4,075 | (29) | ||
(Gain) loss of equity accounted investments | 100 | 190 | 43 | ||
Interest (income) expense, net | (50) | (647) | 72 | ||
Accretion expense | 50 | 63 | 31 | ||
Depreciation and amortization | 1,700 | 103 | 1,129 | ||
Impairment loss on assets | - | 988 | - | ||
Adjusted EBITDA | (4,000) | (8,547) | 268 |
CannTrust has provided a range for the preliminary results described above primarily because its financial closing procedures for the month and quarter ended March 31, 2019 are not yet complete. As a result, there is a possibility that final results will vary from these preliminary estimates. The Company currently expects that final results of operations and other data will be consistent with the estimates set forth above, but such estimates are preliminary and actual results of operations and other data could differ materially from these estimates due to the completion of financial closing procedures, final adjustments and other developments that may arise between now and the time the Company releases unaudited condensed interim consolidated financial statements for the three months ended March 31, 2019 and March 31, 2018. CannTrust undertakes no obligation to update or supplement the information provided above until it releases results of operation for the quarter ended March 31, 2019. KPMG LLP has not audited, reviewed, compiled or performed any procedures with respect to this financial data. Accordingly, KPMG LLP does not express an opinion or any other form of assurance with respect thereto. These are estimates which should not be regarded as a representation by the Company, management as to actual results for the quarter ended March 31, 2019.
About CannTrust
CannTrust is a federally regulated licensed producer of medical and recreational cannabis in Canada. Founded by pharmacists, CannTrust brings more than 40 years of pharmaceutical and healthcare experience to the medical cannabis industry and serves more than 69,000 medical patients with its dried, extract and capsule products. The Company operates its Niagara Perpetual Harvest Facility in Pelham, Ontario, and prepares and packages its product portfolio at its manufacturing centre of excellence in Vaughan, Ontario.
Forward Looking Statements
This press release contains "forward-looking information" within the meaning of Canadian Securities laws and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbor laws, and such statements are based upon CannTrust's current internal expectations, estimates, projections, assumptions and beliefs and views of future events. Forward-looking information and forward-looking statements can be identified by the use of forward-looking terminology such as "believes", "expect", "likely", "may", "will", "should", "intend", "anticipate", "potential", "proposed", "estimate" and other similar words, including negative and grammatical variations thereof, or statements that certain events or conditions "may", "would" or "will" happen, or by discussions of strategy.
Forward-looking information and statements necessarily involve known and unknown risks, including, without limitation statements regarding risks associated with general economic conditions; adverse industry events; loss of markets; future legislative and regulatory developments in Canada, the United States and elsewhere; the cannabis industry in Canada generally; and, the ability of CannTrust to implement its business strategies.
Any forward-looking information and statements speak only as of the date on which they are made, and, except as required by law, CannTrust does not undertake any obligation to update or revise any forward-looking information or statements, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for CannTrust to predict all such factors. When considering these forward-looking information and statements, readers should keep in mind the risk factors and other cautionary statements in CannTrust's Annual Information Form dated March 28, 2019 (the "AIF") and filed with the applicable Canadian securities regulatory authorities on SEDAR at www.sedar.com and filed as an exhibit CannTrust's Form 40-F annual report under the United States Securities Exchange Act of 1934, as amended, with the United States Securities and Exchange Commission on EDGAR at www.sec.gov. The risk factors and other factors noted in the AIF could cause actual events or results to differ materially from those described in any forward-looking information or statements.
The TSX and NYSE do not accept responsibility for the adequacy or accuracy of this release.
Copyright © 2019 CannTrust Holdings Inc.
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SOURCE CannTrust Holdings Inc.