- Quarterly revenue increased 37% year-over-year to
$45.4 million Sixth Consecutive Quarter of Positive Adjusted EBITDA of$2.1 million - Hifyre™ Digital Retail and Analytics Platform generated
$3.8 million in revenue for the quarter, an increase of 160% year-over-year - Completed the acquisiton of PotGuide and the assets of Wikileaf further enhancing the Company's transformational asset-light, digital strategy
- Announced the acquisition of Pineapple Express, subsequent to the 3rd Quarter, positioning
Fire & Flower as a true cannabis consumer technology company
"With these accomplishments, we are rapidly transforming into a cannabis consumer technology platform which allows us to deliver a seamless customer experience from online customer acquisition through to fulfillment via same-day delivery to customers at our 100+ stores across
Consolidated Financial Highlights
Thirteen weeks ended | Thirty-Nine weeks ended | |||
(In thousands of Canadian dollars, | ||||
except per share amounts) | ||||
Total Revenue | 45,412 | 33,119 | 132,802 | 84,834 |
Gross Profit | 15,698 | 11,505 | 48,389 | 28,990 |
Gross Profit Percentage | 34.6% | 34.7% | 36.4% | 34.2% |
Adjusted EBITDA | 2,077 | 1,969 | 7,530 | 1,699 |
Net loss | (1,983) | (25,723) | (44,131) | (67,542) |
Basic loss per share | ( | ( | ( | ( |
Financial Highlights for the Third Quarter period ended
- Total revenue of
$45.4 million compared to revenue of$33.1 million for the third quarter of 2020, an increase of 37%; - Total gross profit
$15.7 million , or 34.6% of revenue, compared to total gross profit of$11.5 million , or 34.7% of revenues in the third quarter of 2020; - Sixth consecutive quarter of positive Adjusted EBITDA of
$2.1 million compared to positive Adjusted EBITDA of$2.0 million for the third quarter of 2020; - Total principal amount of debt outstanding at
October 30, 2021 was$2.4 million ; - Cash and cash equivalents balances of
$16.5 million .
Segment Revenue
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||
(In thousands of Canadian dollars unaudited) | ||||
Revenue | ||||
Retail | 33,692 | 26,534 | 99,153 | 68,341 |
Wholesale | 7,942 | 5,130 | 23,367 | 13,298 |
Digital Platform | 3,778 | 1,455 | 10,282 | 3,195 |
Total Revenue | 45,412 | 33,119 | 132,802 | 84,834 |
Segment Adjusted EBITDA
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||
(In thousands of Canadian dollars unaudited) | ||||
Adjusted EBITDA | ||||
Retail | 2,038 | 3,352 | 4,510 | 5,513 |
Wholesale | 1,269 | 682 | 3,608 | 1,875 |
Digital Platform | 2,288 | 664 | 5,781 | 186 |
Corporate | (3,518) | (2,729) | (6,369) | (5,875) |
Total Adjusted EBITDA | 2,077 | 1,969 | 7,530 | 1,699 |
Retail
- Retail revenue increased by 27.0% year-over-year to
$33.7 million ; - Gross profit increased by 12.7% year-over-year to to
$10.2 million ; - Gross profit margin of 30.3% for the thirteen weeks ended
October 30, 2021 ; - Adjusted EBITDA decreased to
$2.0 million from$3.4 million in the same quarter the prior year; - Adjusted EBITDA margin of 6.0% for the thirteen weeks ended
October 30, 2021 ; - Same-store sales decreased 27% for fifty-four (54) stores in operation during the comparable period in Q3 2021 due primarily to increased competition as the surge in newly licensed retail cannabis stores continues across
Canada (inOntario , 228 new stores were opened in the period); - Expanded the Company's retail network, bringing total stores currently to 102.
Wholesale
- Wholesale revenue increased by 54.8% year-over-year to
$7.9 million ; - Gross profit increased by 72.4% year-over-year to
$1.7 million ; - Gross profit margin of 21.7% for the thirteen weeks ended
October 30, 2021 ; - Adjusted EBITDA increased by 86.1% year-over-year to
$1.3 million ; - Adjusted EBITDA margin of 16.0 % for the thirteen weeks ended
October 30, 2021 .
Digital Platform
- Digital platform revenue increased 159.7% year-over-year to
$3.8 million ; - Adjusted EBITDA increased to
$2.3 milion from$0.7 million in the prior year; - Adjusted EBITDA margin of 60.6% for the thirteen weeks ended
October 30, 2021 .
Corporate
Fire & Flower enhanced its strategic partnership with Alimentation Couche-Tard (ACT) through its "Co-Location Program" which will allow the opening of newFire & Flower cannabis retail stores adjacent to existingCircle K stores in new markets acrossCanada ;- As part of the Company's expanded digital strategy and asset-light model,
Fire & Flower completed the acquisitions of PotGuide and Wikileaf; - The Company repaid
$2.3 million outstanding prior to maturity under a term loan facility withATB Financial .
- The Company announced the acquisition of Pineapple Express Delivery,
Canada's largest delivery and logistics company serving cannabis consumers; - Spark Perks members grew from 45,000 in Q3 2020 to over 346,000 across
Fire & Flower's entire retail network in Q3 2021; - Continued toward a Nasdaq listing with a consolidation of Common Shares on the basis of 10 pre-consolidation Common Shares for one post-consolidation Common Share. The Company is targeting early first quarter 2022 for its Nasdaq listing;
- Announced
$30 million Secured Debt Facility with strategic partner Alimentation Couche-Tard.
Non-IFRS Measures – Adjusted EBITDA "Adjusted EBITDA" is a Non-IFRS metric used by management that does not have any standardized meaning prescribed by IFRS and may not be fully comparable to similar measures by presented by other companies. Management defines the Adjusted EBITDA as the Income (loss) for the period, as reported, before income taxes and other expense (income) items such as finance costs, finance income, gains and losses related to derivative liability revaluations and debt extinguishments, and adjusted for share-based compensation, depreciation and amortization, impairment expense, impairment of right-of-use ("ROU") assets net of lease liabilities remeasurement, restructuring charges, professional fees associated with acquisitions, financing and strategic initiatives.
Adjusted EBITDA has been calculated differently than in periods prior to Q1 2021, where the Company previously included lease liability cash payments as disclosed in accordance with IFRS 16 "Leases" accounting standards. The updated measure reflects the Company's new approach to analyzing the consolidated operating performance across the business lines. The Company believes the updated definition is an alternative measure to assess performance as it provides meaningful operating results and facilitates period-to-period operating comparisons. As other companies may calculate this non-IFRS measure differently than the Company, this metric may not be comparable to similarly titled measures reported by other companies. We caution readers that Adjusted EBITDA should not be substituted for determining net income (loss) as an indicator of operating results, or as a substitute for cash flows from operating activities. A reconciliation of net income (loss) to Adjusted EBITDA is presented below.
Adjusted EBITDA for the fiscal third quarter ended
Adjusted EBITDA
Thirteen Weeks ended | Thirty-nine Weeks ended | |||
(in thousands of dollars) | ||||
Net loss – as reported | (1,983) | (25,723) | (44,131) | (67,542) |
(Gain) loss on revaluation of derivative liability | (12,686) | (35,796) | 16,103 | (21,082) |
Loss on extinguishment and revaluation of debentures | - | 53,862 | - | 53,862 |
Finance costs, net | 1,333 | 5,972 | 5,740 | 20,829 |
Income taxes, net | (933) | 1,218 | 1,122 | 1,218 |
Share-based compensation | 855 | 581 | 2,706 | 1,990 |
Acquisition and strategic initiative professional fees | 740 | 1,060 | 1,788 | 1,338 |
Depreciation & amortization | 5,074 | 2,914 | 13,585 | 8,926 |
Restructuring, impairment and other costs, net | 9,677 | (2,119) | 10,617 | 2,160 |
Adjusted EBITDA | 2,077 | 1,969 | 7,530 | 1,699 |
Lease liability cash payments during the thirteen and thirty-nine weeks ended |
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About Fire & Flower
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws ("forward-looking statements"). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "could", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "project" and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions "may" or "will" occur. These statements are only predictions.
Forward-looking statements are based on the opinions and estimates of management of
No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. Additional information regarding risks and uncertainties relating to the Company's business are contained under the headings "Risk Factors" in the Company's Annual Information Form dated
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