Highlights include:

• Q1 saw continued growth of our California cannabis distribution business, generating revenue of a quarter-over-quarter increase of 68%
• Q1 revenue in the North American accessories business grew by 11% quarter over quarter
• Q1 saw a quarter-over-quarter decrease in operating expenses of 21% or $2.3m, driven by decreased costs in our North American accessories business of 44% or $3.8m, offset by increased costs of 57% or $1.5m relating to the expansion of the California cannabis distribution business

TORONTO, Nov. 29, 2022 /PRNewswire/ - Humble & Fume Inc. (CSE: HMBL) (OTCQX: HUMBF) ("Humble" or the "Company"), a leading North American distributor of cannabis and cannabis accessories, supported by a customer-centric sales team and robust fulfillment infrastructure, today reported its first quarter fiscal 2023 ("Q1 2023") financial and operating results for the three months ended September 30, 2022.

Joel Toguri, Chief Executive Officer of Humble, commented:

"Our focus continues to be optimizing growth opportunities while proactively right-sizing the business. We are very pleased with our efforts to expand our portfolio of cannabis brands and broaden the scope and scale of our retail relationships."

The California cannabis distribution business revenue grew quarter-over-quarter by 68%. Restructuring initiatives completed last fiscal year are positively impacting the P&L, with operational expenses relating to the North American accessories down quarter-over-quarter by $3.8m or 44%.

Inventory levels with the North American accessories business continue to decrease, selling off old/slow-moving items. Year over year inventory has decreased by $6.5m, with the prior year having a balance of $17.8m vs the current balance of $11.2m. Quarter-over-quarter inventory has decreased by 10% or $1.3m.

Mr. Toguri continued, "California continues to be a dynamic market providing ongoing growth opportunities to help great brands, like Cookies, scale throughout the state."

Cookies, the leading California-based lifestyle, and cannabis brand was successfully onboarded with revenue starting in October. Operational costs in Q1 have been incurred ahead of the revenue, with additional headcount, vehicles, and other one-time costs added to ensure successful onboarding & to have the infrastructure in place to start selling on October 1, 2022.

The California cannabis distribution business continues to grow, with revenue increasing quarter-over-quarter.

• This quarter saw our retail customer base grow from 81 to 290; this represents an increase of 258%.
• The number of deliveries experienced a similar increase growing from 128 in the prior quarter to 602, representing an increase of 370%.

"Our ongoing focus on profitable growth includes right-sizing our organization to ensure we have the most effective and efficient team in place to serve the needs of our brand and retail partners," said Mr. Toguri.

Restructuring & cost-saving initiatives taken last year are starting to show in the P&L, with overall operational expenses down year over year by $1.5m & down $3.8m quarter-over-quarter relating to the North American accessories business. Salary and wages experienced the most significant reduction, with YoY savings of 20.7% and QoQ reduction of 14.6%

About Humble & Fume, Inc. 
Humble & Fume, Inc. is a leading North American distributor of cannabis and cannabis accessories, supported by a customer-centric sales team and strong fulfillment infrastructure. As the only fully-integrated cannabis distribution solution, Humble bridges the gap for retailers, licensed cannabis producers, multi-state operators, and cannabis consumers to maximize sales penetration, and increase financial performance. With over 20 years of North American operating experience, Humble has cultivated extensive vendor and customer relationships, distributing premium cannabis consumables and consumption devices.

NON-IFRS FINANCIAL MEASURES

EBITDA and Adjusted EBITDA are financial measures that are not defined under IFRS. We define EBITDA as net income (loss), or "earnings", before interest, income taxes, depreciation and amortization. We define Adjusted EBITDA as EBITDA before: (i) fair value adjustments on biological assets and fair value adjustments on sale of inventory; (ii) share-based compensation expense; (iii) RTO listing expense; and (iv) goodwill impairment losses. We believe Adjusted EBITDA is a useful measure to assess the performance of the Company as it provides more meaningful operating results by excluding the effects of expenses that are not reflective of our operating business performance and other one-time or non- recurring expenses, and also provide additional perspective and insights when analyzing the core operating performance of the business. These supplemental non-IFRS financial measures should not be considered superior to, as a substitute for or as an alternative to, and should only be considered in conjunction with, the IFRS financial measures presented herein.

FORWARD-LOOKING INFORMATION AND STATEMENTS

This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the proposed listing on the CSE, the focus of the Company's business, and intentions of those subject to early warning disclosure requirements. Any such forward-looking statements may be identified by words such as "expects", "anticipates", "intends", "contemplates", "believes", "projects", "plans" and similar expressions. Readers are cautioned not to place undue reliance on forward-looking statements. Statements about, among other things, Humble & Fume Inc.'s strategic plans including future growth opportunities and strategies in the United States are all forward-looking information. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance, or achievements to be materially different from those implied by such statements. Although such statements are based on management's reasonable assumptions, there can be no assurance that such forward-looking statements will occur as described herein. The Company assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances or actual results unless required by applicable law. Readers are encouraged to refer to the Company's disclosure available on its SEDAR profile (at www.sedar.com) for information as to the risks and other factors which may effect the Company's business objectives and strategic plans.

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SOURCE Humble & Fume Inc.