Cansortium Inc. Reports Second Quarter Financial Results
Company achieves record revenue, more than doubling last year’s second quarter revenue
MIAMI, Aug. 26, 2020 /PRNewswire/ – Cansortium Inc. (CSE:TIUM.U) (OTCQB: CNTMF) (“Cansortium” or the “Company”), a vertically-integrated provider of premium-quality medical cannabis, today announced financial results for its second quarter and six months ended June 30, 2020. The Company’s unaudited condensed interim consolidated financial statements and accompanying notes, along with the Management Discussion and Analysis (MD&A) are available under the Company’s profile on SEDAR at www.sedar.com and are also accessible through a link on the Investor Relations section of the Company’s website at www.cansortium.com.
Selected Second Quarter 2020 Financial Highlights
- Consolidated revenue of $13.2 million, an increase of 117 percent or $7.1 million compared with consolidated revenue of $6.1 million in the second quarter of 2019.
- Consolidated income from operations of $0.8 million, compared to loss from operations of $(8.1) million in the second quarter of 2019.
- Consolidated Adjusted EBITDA(1) of $2.6 million, compared to Adjusted EBITDA(1) loss of $(1.7) million in the second quarter of 2019.
- Consolidated net loss of $(5.5) million, or $(0.03) per diluted share, compared to consolidated net loss of $(5.3) million, or $(0.03) per diluted share for the same period last year.
- During the second quarter of 2020, the Company opened its 20th medical marijuana dispensary in East Orlando, FL. It operated 11 dispensaries during the comparable period in 2019. On August 21st, the Company opened its 21st Florida dispensary in Coral Springs, FL.
(1) Adjusted EBITDA is a non-IFRS financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. The Company calculates adjusted EBITDA from EBITDA plus (minus) unrealized loss (gain) on embedded derivatives, plus (minus) certain one-time non-operating expenses, as determined by management. Reconciliations from EBITDA and Adjusted EBITDA to Net Loss are included in the accompanying financial schedules.
Chief Financial Officer Marcos Pedreira commented, “We delivered strong results during the second quarter of 2020. Revenue more than doubled from a year ago and we continue to make significant improvements to deliver the 2020 projected financial results.”
Selected Year-to-Date 2020 Financial Highlights
- Consolidated revenue of $23.4 million, an increase of 101 percent or $11.8 million compared with consolidated revenue of $11.6 million in the first half of 2019.
- Consolidated income from operations of $3.2 million, compared to loss from operations of $(20.6) million in the first half of 2019.
- Consolidated Adjusted EBITDA(1) of $3.3 million, compared to Adjusted EBITDA(1) loss of $(5.1) million in the first half of 2019.
- Consolidated net loss of $(19.4) million, or $(0.10) per diluted share, compared to consolidated net loss of $(21.8) million, or $(0.12) per diluted share for the same period last year.
(1) Adjusted EBITDA is a non-IFRS financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. The Company calculates adjusted EBITDA from EBITDA plus (minus) unrealized loss (gain) on embedded derivatives, plus (minus) certain one-time non-operating expenses, as determined by management. Reconciliations from EBITDA and Adjusted EBITDA to Net Loss are included in the accompanying financial schedules.
Full Year 2020 Outlook
The Company has continued to make progress on its targeted initiatives focused on growth and long-term shareholder value creation. In the second quarter, the Company completed its exit from the non-core markets of Canada and Puerto Rico, streamlining operations and freeing up capital for its U.S. markets. In its home state of Florida, the Company secured an additional cultivation and production facility with minimum capital outlay, with operations anticipated to commence in the fourth quarter of 2020, and has opened three of the seven dispensaries planned for 2020. In Pennsylvania, the Company is actively pursuing two additional dispensary locations to augment the strong sales of its existing Hanover dispensary. In Michigan, the Company enhanced the cultivation team on the ground with the engagement of Freedom Town. Finally, in Texas, the Company recently secured an extension of its convertible notes to allow the Company to continue to seek longer-term solutions there. The Company reiterates its full year 2020 outlook for consolidated revenues in the range of $55 million to $60 million and Adjusted EBITDA of more than $15 million. The forecast is based on projected revenues of at least $45 million for Cansortium’s Florida operations with additional revenue from the Michigan, Pennsylvania and Texas markets.
ABOUT CANSORTIUM INC.
Headquartered in Miami, Florida, and operating under the Fluent™ brand, Cansortium is focused on being the highest quality cannabis company in the State of Florida driven by unrelenting commitment to operational excellence from seed to sale. Cansortium has developed strong proficiencies in each of cultivation, processing, retail, and distribution activities, the result of successfully operating in the highly regulated cannabis industry. In addition to Florida, Cansortium is seeking to create significant shareholder value in the attractive markets of Texas, Michigan and Pennsylvania.
Cansortium Inc.’s common shares and warrants trade on the CSE under the symbol “TIUM.U” and “TIUM.WT.U”, respectively, and on the OTCQB Venture Market under the symbol (OTCQB: CNTMF). Investors can find current financial disclosure and Real-Time Level 2 quotes for the Company on www.otcmarkets.com.
Cansortium Inc.
Reconciliation of non-IFRS financial measures
For the three and six months ended June 30, 2020 and 2019
(USD ‘000)
EBITDA
EBITDA is a non-IFRS financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. The Company calculates EBITDA from net income (loss), plus (minus) interest expense (income), plus income taxes, plus depreciation and amortization, as follows:
Adjusted EBITDA
Adjusted EBITDA is a non-IFRS financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. The Company calculates adjusted EBITDA from EBITDA plus (minus) unrealized loss (gain) on embedded derivatives, plus (minus) certain one-time non-operating expenses, as determined by management. The reconciliation from EBITDA to Adjusted EBITDA is as follows:
