Streamlining and Focusing Operations
- On
April 20 th, experienced Pharma and Med Tech executiveDavid Pidduck was named Chief Executive Officer and Director of the Company. - Subsequent to the quarter, entered into a Share Purchase Agreement for the sale of MediPharm Labs Australia PTY for a minimum of AUD$6.9M, which is expected to close in Q3 or Q4 2022. The sale strengthens the balance sheet while enhancing capacity utilization at the Company's Canadian GMP facility. The Company expects to save approximately
$4M in expenses annualized following the sale of this facility. - Implemented a restructuring plan that will reduce Canadian non-manufacturing headcount by approximately 30%, reducing annualized expenses by approximately
$3M beginning in Q3 2022. - Engaged strategic M&A advisors to assess inorganic growth opportunities
Continued Progress Towards Leadership in the Cannabis-Based Pharmaceutical Opportunity
- Subsequent to the quarter, entered into a research support agreement with the
Keck School of Medicine of University ofSouthern California to conduct a Phase 2 trial on the efficacy of THC and CBD to treat hospice-eligible patients diagnosed with dementia and experiencing agitation. The lead investigators have been awarded a total ofUS$16M in the form of grants from theUS National Institute of Health and theNational Institute on Aging .
Further Expansion of International Medical Business
- The Company's German partners, such as
STADA , generated sequential growth in patient sales during Q2.MediPharm expects inventory replenishment by these partners during H2 2022 to have an incrementally positive impact on wholesale sales. - Subsequent to the quarter,
MediPharm received its first regulatory permits to ship GMP API toDenmark . - Received its first commercial volume import permits from the
Brazilian Health Regulatory Agency (Anvisa).Brazil is a large potential market with rigorous regulatory oversight.MediPharm is a one of only a few manufacturers with approved products for sale under the country's medical access program and has the only authorization for a product produced inCanada . First commercial shipments toBrazil are expected to be delivered in H2 2022.
Innovation and New Product Launches Drive Canadian Distribution Growth
MediPharm began distributing Shelter Cannabis dried flower products in late Q2, beginning inOntario , BC, andAlberta , followed byQuebec andSaskatchewan . Initial product feedback and demand has been positive.- The Company successfully launched its innovative CBN and CBD soft chew, and a novel all-in one rechargeable vape pen and vape cartridge variety pack with three units per package. These products were delivered to the
Ontario Cannabis Store warehouse in July and were available to consumers at the beginning of August, with plans to expand nationally in the coming months. - As the Company continues to expand its portfolio to grow future sales, the
MediPharm wellness cannabis oil remains a core product line. In Q2 2022,MediPharm held the number two market share nationally in this subcategory.
Solid balance sheet, materially debt free, outright ownership of key assets
- In July, the company was awarded a favourable summary judgment in the
Ontario Court of Justice in connection with a supply agreement dispute in the amount of$9.8M . This summary judgement and subsequent payment, and the conditional sale of the Australian facility, are expected to add over$16M in cash to the balance sheet. - The Company remains materially debt free and has outright ownership of its assets, including its GMP facility in
Ontario .
| 2021 | 2022 | ||
$'000s | $'000s | $'000s | ||
Revenue | 4,362 | 5,072 | 4,877 | |
Gross profit | (532) | (7,733) | (403) | |
Adjusted Gross | (47) | (1,418) | (403) | |
Adjusted EBITDA1 | (6,345) | (7,434) | (5,684) | |
Date: August 15, 2022 | Time:
Conference ID: 4921762
(Participants are asked to dial in approximately 15 minutes before the start of the call)
An audio webcast will be available in the Events section of the
_____________________ |
1 Adjusted Gross Profit and Adjusted EBITDA are non-IFRS measures. See the Non-IFRS Measures section of this news release. |
For those who are unable to participate on the live conference call or webcast, a replay will be available approximately one hour after completion of the call.
Adjusted EBITDA and adjusted Gross Profit are not recognized performance measures under IFRS, do not have a standardized meaning and therefore may not be comparable to similar measures presented by other issuers. Adjusted EBITDA and adjusted Gross Profit are included as a supplemental disclosure because Management believes that such measurement provides a better assessment of the Company's operations on a continuing basis by eliminating certain non-cash charges and charges or gains that are non-recurring. Adjusted EBITDA is defined as net loss excluding interest, taxes, depreciation and amortization expense, interest income and expense, finance fees, gain in revaluation of derivative liabilities, taxes, impairment losses on inventory, write down of deposits and share-based compensation. Adjusted EBITDA has limitations as an analytical tool as it does not include depreciation and amortization expense, interest income and expense, taxes, share-based compensation and transaction fees. Because of these limitations, Adjusted EBITDA should not be considered as the sole measure of the Company's performance and should not be considered in isolation from, or as a substitute for, analysis of the Company's results as reported under IFRS. The most directly comparable measure to Adjusted EBITDA calculated in accordance with IFRS is operating income (loss). The above is a reconciliation of the Company's operating loss to Adjusted EBITDA. See "Reconciliation of non-IFRS measures" in the Company's Management's Discussion and Analysis for the period ended
Founded in 2015,
In 2021,
This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate to, among other things, statements regarding: cash savings from the sale of the Australian facility and the corporate restructuring; the collection of the favourable summary judgment; the closing of the sale of the Australian facility; potential for material revenue growth for years to come; and the Company's transition towards pharmaceutical and medical markets reaching new heights. 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; the inability of
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