Mettrum Announces Third Quarter Fiscal 2016 Financial Results
Q3 2016 versus Q2 Financial Highlights:
- Revenue increased 18% to $2,016,683
- Gross Margin increased 39% to $1,351,287 (67% of Sales)
- Reduced growing costs by 20% to $2.55 per gram
TORONTO, ONTARIO–(Marketwired – Feb. 23, 2016) – Mettrum Health Corp. (“Mettrum” or the “Company”) (TSX VENTURE:MT), a vertically integrated provider of cannabis products, announced today its third quarter fiscal 2016 financial results for the period ended December 31, 2015.
For the third quarter ended December 31, 2015, Mettrum revenues increased 18 percent to $2,016,683 versus $1,711,072 during the previous quarter. Average selling price per gram increased to $7.90 from $7.74 in the prior quarter. Gross margin increased by 39% to $1,351,287 or 67%, from $971,237 or 57% during the previous quarter. Mettrum reduced growing costs by 20% to $2.55 per gram for the quarter ended December 31, 2015 from $3.17 for the quarter ended September 30, 2015. EBITDA improved by 18% to a loss of $1,337,989 for the quarter ended December 31, 2015 versus a loss of $1,622,121 for the quarter ended September 30, 2015.
Gross Margin, adjusted for fair value gain on biological assets and amortization, for the three months ended December 31, 2015 was 55% and for the three months ended September 30, 2015 was 48%. As at December 31, 2015, the Company maintained a solid balance sheet with a cash position of approximately $11.1 million.
- As of February 23, 2016 Mettrum has over 6,100 Active Registrations
- Received Production License for 3rd facility – 60,000 sq. ft. on 7 acres of Mettrum Owned Property
- Received License to produce and sell cannabis extracts
- Positive impact on cost per gram from first harvest at Mettrum Creemore’s upgraded facility
- Mettrum Originals began U.S. distribution in December
“Client acquisition, and subsequently sales, were constrained for the majority of Q3 due to product availability. In December, we began to see the benefits of our expansion and production upgrades from our Creemore facility. Our inventory and availability of products throughout the Mettrum Spectrum have allowed us to accept more clients than ever before. As a result, we’ve seen a 20% increase in the total number of registered clients so far in Q4,” noted Michael Haines, CEO of Mettrum. “With three production facilities licensed to grow, along with our authorization to sell medical cannabis oils, we are able to meet the demands of our growing client base. The capital we’ve invested, and process improvements we’ve implemented, during the recent quarters will continue to drive down production costs while maintaining quality and consistency and increasing availability. We are now better positioned than ever to accelerate sales in the coming quarters and achieve profitability, highlighted by our improved operating results during the reported quarter.”
During the quarter, Mettrum received a license for its production facility in Bowmanville, Ontario. The facility, Mettrum’s third and largest, is 60,000 sq. ft. including a 6,000 sq. ft. vault. Mettrum now has a total of approximately 90,000 sq. ft. of indoor production capacity that, on a fully built out basis, would generate about 12,000 kgs per year of dried cannabis, enough production to service approximately 45,000 clients based on current industry consumption rates. Mettrum’s combined licensed production area can produce approximately 6,000 kgs per year. It is currently licensed to produce 3,500 kgs per year, enough to supply over 13,000 clients. As Mettrum continues to grow its client base and more product is required, it will seek to amend its licenses accordingly to utilize existing production capacity.
On December 23rd, Mettrum received approval from Health Canada to begin selling cannabis oils. Mettrum is the second company in the industry to be awarded a license for the production and sale of cannabis extracts. The first bottles went on sale in the last week of January. Mettrum’s first products are analogue versions of its products within the Mettrum Spectrum. Each 40 ml bottle of oil contains roughly the same amount of medicinal content, THC and CBD, as 5 grams of the corresponding dried cannabis. The oil products are made from whole flowers in order to preserve as much of the terpene profile of the cannabis flower as possible. The final extract is then diluted in Medium Chain Triglyceride, or MCT oil. MCT is the purest food based oil produced and it has no flavour or aroma so the only thing the client can taste or smell comes from the flowers that are extracted. A 40 ml bottle of Mettrum’s oil contains about 1,000 mgs of medicinal content (THC and CBD) and sells for $90, before a 30% discount for clients on medical or financial assistance programs. That works out to about $.09 per mg of medicinal content. Based on initial sell through, Mettrum has ordered equipment to increase its current production capacity in anticipation of future demand.
Mettrum’s functional food line, Mettrum Originals, continued to make great progress in the quarter by making its first in-roads into the United States. United Natural Foods Inc. (“UNFI”) was secured as Mettrum Originals U.S. distributor, initially adding 1,300 stores bringing total stores to approximately 2,000. The current quarter will see further distribution into traditional mass-market retailers in Canada and the U.S.
For detailed analysis of the quarterly results, please view the company’s financial statements and Management Discussion and Analysis at www.sedar.com.
About Mettrum Health Corp.
Mettrum Health Corp. is a Tier 1 Industry Issuer listed on TSX Venture Exchange. Mettrum Ltd., a wholly owned subsidiary of the Company, is a Toronto-based company and a licensed producer of medical cannabis under theMarihuana for Medical Purposes Regulations (Canada) issued pursuant to the Controlled Drugs and Substances Act(Canada) (the “MMPR”), which came into effect on October 1, 2013. Mettrum received its first license from Health Canada under the MMPR on November 1, 2013 and began production of medical cannabis at its first production facility in Bowmanville, Ontario. Mettrum received its second license from Health Canada under the MMPR on December 11, 2014 for its other wholly-owned subsidiary, Agripharm Corp., at Mettrum Creemore facility in Clearview, Ontario. Mettrum received its third license from Health Canada under the MMPR on December 17, 2015 for Mettrum Ltd. at its new 60,000 square foot production and distribution facility in Bowmanville, Ontario. With the Company’s three licenses, Mettrum is a leading producer and vendor of medical cannabis under the MMPR system. In addition, through its wholly-owned subsidiary Mettrum Hempworks, Mettrum also is a licensed producer and distribution of industrial cannabis (hemp) products, including Mettrum’s functional food line, Mettrum Originals, under the Industrial Hemp Regulations (Canada) issued pursuant to the Controlled Drugs and Substances Act (Canada).
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain “forward-looking statements” under applicable Canadian securities legislation. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the 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: general business, economic, competitive, political and social uncertainties; delay or failure to receive board, shareholder or regulatory approvals; and the results of operations. 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. The Company and Mettrum disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Neither the Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this Press release.
Mettrum Health Corp.
Director, Investor Relations