- Total revenue of
$22.0 million versus$24.1 million in Q3 2021 - Gross profit margin expansion to 44.2% compared to 40.3% in Q3 2021
- Adjusted EBITDA(1) increased to
$3.3 million versus$3.1 million in Q3 2021 - Net loss of
$93.5 million , including non-cash impairment of goodwill and intangible assets of$89.9 million - Adjusted Net Loss(1) of
$0.2 million versus Adjusted Net Income of$0.3 million in Q3 2021 - Appointment of Kathy Mayor to Board of Directors
VAUGHAN, ON,
"It was a challenging period from a sales perspective, as a result of the reduced net distribution footprint from earlier this year, and the impact of inventory tightening at key retailers in response to reduced consumer spending," said
(in thousands of US dollars except per share amounts) (unaudited) | Q3 2022 | Q3 2021 | YTD 2022 | YTD 2021 |
Revenue | 22,048 | 24,123 | 68,558 | 80,453 |
Gross profit | 9,737 | 9,733 | 29,811 | 33,584 |
Net (loss) for the period | (93,540) | (103,146) | (93,908) | (97,494) |
Loss per Share (basic) | (2.54) | (2.81) | (2.55) | (2.65) |
Adjusted EBITDA | 3,317 | 3,114 | 9,667 | 13,346 |
Cash flow from operating activities | 855 | 1,898 | 5,875 | 6,173 |
Adjusted Free Cash Flow | 811 | 1,760 | 5,745 | 5,661 |
Adjusted Net Income (Loss) | (188) | 266 | 438 | 3,617 |
Adjusted Net Income (Loss) per Share (diluted) | (0.01) | 0.01 | 0.01 | 0.08 |
(1) | EBITDA (used below), Adjusted EBITDA, Free Cash Flow, Adjusted Free Cash Flow, Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Share (diluted), and Net Debt (used below) are each non-IFRS measures and are not earning measures recognized by IFRS. Further information about non-IFRS measures and definitions of the non-IFRS measures used in this press release can be found under the heading "Non-IFRS Measures" in this press release. Reconciliations of non-IFRS measures to the relevant reported measures prepared in accordance with IFRS can be found in this press release under the headings "Q3 2022 Compared to Q3 2021". See also the heading "How We Assess the Performance of Our Business" on page 8, and the heading "Non-IFRS Measures" on page 10 of our Management's Discussion and Analysis for the three- and nine-month periods ended |
(2) | Certain comparative figures have been revised to reclassify compliance charges that were previously recorded in selling and administrative expenses to revenue to conform with IFRS 15 and the financial presentation adopted for the current period. |
(3) | Earnings per share (basic) calculation does not include the impact of 2,463,963 common shares of the Company issuable upon the exchange of the units issued as part of The Mane Choice acquisition. |
Q3 2022 total revenue was
Gross profit was
Adjusted EBITDA(1) increased to
In Q3 2022, the Company reported a net loss of
Adjusted Net Loss(1) was ($0.2) million, compared with Adjusted Net Income of
Cash flow from operating activities was
The Company also announced that highly experienced executive Kathy Mayor will join MAV's Board as an independent director, effective November 3, 2022.
Ms. Mayor is currently the Chief Marketing Officer of Transformco, a leading integrated retailer focused on seamlessly connecting the digital and physical shopping experiences. Previously, she served as Chief Marketing Officer at BoxyCharm; Chief Marketing Officer and
"We welcome Kathy to MAV's Board and look forward to benefiting from her insights and experience," said
The Company's unaudited condensed consolidated interim financial statements and Management's Discussion and Analysis for the three- and nine-month periods ended
MAV Beauty Brands is a global personal care platform focused on acquiring great independent brands and helping these brands to scale and win market share through product innovation, marketing and expanded distribution, Today,
This press release makes reference to certain non–IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. We use non–IFRS measures including "Adjusted Net Income (Loss) Per Share (Diluted)", "Adjusted EBITDA", "Adjusted Free Cash Flow", "Adjusted Net Income (Loss)", "EBITDA", "Free Cash Flow" and "Net Debt". These non–IFRS measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS financial measures. We also believe that securities analysts, investors, and other interested parties frequently use non–IFRS measures in the evaluation of issuers. Our management also uses non–IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and to determine components of management compensation. Definitions and reconciliations of non-IFRS measures to the relevant reported measures prepared in accordance with IFRS can be found under the headings "Non-IFRS Measures" and "Q3 2022 Compared to Q3 2021" in this press release. See also our Management's Discussion and Analysis under the headings "How We Assess the Performance of Our Business" on page 8, and "Non-IFRS Measures" on page 10.
"Adjusted Net Income (Loss) Per Share (Diluted)" is computed similarly to basic earnings per share except that the weighted average number of shares outstanding is increased to include additional shares for the assumed conversion of preference shares, proportionate voting shares, and exchangeable shares and exercise of stock options, if dilutive. The average number of shares is calculated by assuming that outstanding conversions were exercised and that the proceeds from such exercises were used to acquire common shares at the average market price during the reporting period. We believe Adjusted Net Income (Loss) Per Share (Diluted) is a useful measure to assess the performance of our Company as it provides meaningful operating results per diluted share and facilitates period-to-period operating comparisons.
"Adjusted EBITDA" represents, for the applicable period, EBITDA before certain expenses, costs, charges or benefits incurred in such period which in management's view are not indicative of continuing operations, including: (i) integration, restructuring, and other costs; (ii) purchase accounting adjustments; (iii) share–based compensation; (iv) impairment of goodwill; and (v) unrealized foreign exchange (loss) gain. We believe Adjusted EBITDA is a useful measure to assess the performance of our Company as it provides meaningful operating results and facilitates period-to-period operating comparisons.
"Adjusted Free Cash Flow" is calculated as Free Cash Flow adjusted to add back acquisition related costs which are included in cash provided by operating activities. We believe Adjusted free cash flow is a useful measure to assess the Company's ability to repay debt, finance strategic business acquisitions and investments, pay dividends and repurchase shares. It also facilitates period-to-period comparisons.
"Adjusted Net Income (Loss)" represents, for the applicable period, net income (loss) as adjusted to add back or deduct, as applicable, certain expenses, costs, charges or benefits incurred in such period which in management's view are not indicative of continuing operations, including: (i) integration, restructuring, and other costs; (ii) purchase accounting adjustments; (iii) share–based compensation; (iv) impairment of goodwill; (v) unrealized foreign exchange loss (gain); and (vi) tax impacts of the aforementioned adjustments (based on annual effective tax rate). We believe Adjusted Net Income (Loss) is a useful measure to assess the performance of our Company as it provides meaningful operating results and facilitates period-to-period operating comparisons.
"EBITDA" represents net income (loss) for the period before: (i) income tax expense (recovery); (ii) interest and accretion; and (iii) amortization and depreciation.
''Free Cash Flow'' represents, for the applicable period, cash provided by operating activities less cash used to purchase property and equipment. Free cash flow is a key metric used by the investing community that measures the Company's ability to repay debt, finance strategic business acquisitions and investments, pay dividends and repurchase shares.
"Net Debt" is calculated as long-term debt before unamortized deferred financing costs less cash as reported in the consolidated statements of financial position. We believe Net Debt is a useful measure is an important measure as it reflects the principal amount of debt owing by the Company as at a particular date.
Certain information in this press release, including the Company's expectation for the haircare market, improved operational execution across the Company's platform, continued resilience of the Company's core categories through economic downturns, the ability to achieve improved and consistent operating results and financial performance, including by expanding distribution and regaining sales momentum, the ability to build the desirability and awareness of our brands through product innovation, the ability to adjust pricing to offset higher product input and supply chain costs and successfully complete procurement cost savings initiatives, constitutes forward-looking information. In some cases, but not necessarily in all cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "is positioned", "estimates", "intends", "assumes", "anticipates" or "does not anticipate" or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will" or "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management's expectations, estimates and projections regarding future events.
Forward-looking information is necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by
(in thousands of US dollars) (unaudited) | Q3 2022 | Q3 2021 | $ Change | % Change | ||||
Consolidated statements of operations: | ||||||||
Revenue (1) | 22,048 | 24,123 | (2,075) | (8.6 %) | ||||
Cost of sales | 12,311 | 14,390 | (2,079) | (14.4 %) | ||||
Gross profit | 9,737 | 9,733 | 4 | 0.0 % | ||||
Expenses | ||||||||
Selling and administrative (1) | 6,771 | 6,852 | (81) | (1.2 %) | ||||
Amortization and depreciation | 1,096 | 1,102 | (6) | (0.5 %) | ||||
Impairment of goodwill and intangible assets | 89,904 | 129,033 | (39,129) | (30.3 %) | ||||
Interest and accretion | 2,036 | 1,481 | 555 | 37.5 % | ||||
Foreign exchange gain | (221) | (82) | (139) | 169.5 % | ||||
Integration, restructuring, and other | 38 | 888 | (850) | (95.7 %) | ||||
99,624 | 139,274 | (39,650) | (28.5 %) | |||||
Loss before income taxes | (89,887) | (129,541) | 39,654 | (30.6 %) | ||||
Income tax expense (recovery) | ||||||||
Deferred | 3,653 | (26,395) | 30,048 | (113.8 %) | ||||
3,653 | (26,395) | 30,048 | (113.8 %) | |||||
Net loss for the period | (93,540) | (103,146) | 9,606 | (9.3 %) | ||||
EBITDA (2) | (86,755) | (126,958) | 40,203 | (31.7 %) | ||||
Adjusted EBITDA (2) | 3,317 | 3,114 | 203 | 6.5 % | ||||
Adjusted Net Income (Loss) (2) | (188) | 266 | (455) | nmf | ||||
(1) | Certain comparative figures have been revised to reclassify compliance charges that were previously recorded in selling and administrative expenses to revenue to conform with IFRS 15 and the financial presentation adopted for the current period. |
(2) | EBITDA, Adjusted EBITDA and Adjusted Net Income (Loss) are each non-IFRS measures and are not earning measures recognized by IFRS. For definitions and reconciliations of non-IFRS measures to the relevant reported measures can be found under the headings "Non-IFRS Measures" and "Q3 2022 Compared to Q3 2021" in this press release. See also our Management's Discussion and Analysis under the headings "How We Assess the Performance of Our Business" on page 8, and "Non-IFRS Measures" on page 10. |
(in thousands of US dollars) (unaudited) | Q3 2022 | Q3 2021 | YTD Q3 2022 | YTD Q3 2021 | |||||
Consolidated net income (loss): | (93,540) | (103,146) | (93,908) | (97,494) | |||||
Income tax expense | 3,653 | (26,395) | 3,346 | (24,379) | |||||
Interest and accretion | 2,036 | 1,481 | 5,529 | 4,966 | |||||
Amortization and depreciation | 1,096 | 1,102 | 3,293 | 3,269 | |||||
EBITDA | (86,755) | (126,958) | (81,740) | (113,638) | |||||
Integration, restructuring, and other | (1) | 38 | 888 | 826 | (2,750) | ||||
Share-based compensation | (2) | 303 | 184 | 904 | 722 | ||||
Impairment of goodwill and intangible assets | (3) | 89,904 | 129,033 | 89,904 | 129,033 | ||||
Unrealized foreign exchange (gain) loss | (173) | (33) | (227) | (21) | |||||
Adjusted EBITDA | 3,317 | 3,114 | 9,667 | 13,346 |
(in thousands of US dollars) (unaudited) | Q3 2022 | Q3 2021 | YTD Q3 2022 | YTD Q3 2021 | |||||||
Consolidated net income (loss): | (93,540) | (103,146) | (93,908) | (97,494) | |||||||
Integration, restructuring, and other | (1) | 38 | 888 | 826 | (2,750) | ||||||
Share-based compensation | (2) | 303 | 184 | 904 | 722 | ||||||
Impairment of goodwill and intangible assets | (3) | 89,904 | 129,033 | 89,904 | 129,033 | ||||||
Unrealized foreign exchange (gain) loss | (173) | (33) | (227) | (21) | |||||||
Tax impact of the above adjustments | 3,280 | (26,660) | 2,939 | (25,873) | |||||||
Adjusted Net Income (Loss) | (188) | 266 | 438 | 3,617 |
(1) | Refer to Note 11 to the unaudited condensed consolidated interim financial statements for further details. |
(2) | Represents recognition of share-based compensation, which have been accounted for as selling and administrative expenses. |
(3) | Refer to Note 9 to the unaudited condensed consolidated interim financial statements for further details. |
(in thousands of US dollars) (unaudited) | Q3 2022 | Q3 2021 | YTD Q3 2022 | YTD Q3 2021 | ||||||
Cash provided by operating activities | 855 | 1,898 | 5,875 | 6,173 | ||||||
Less: purchase of property and equipment | (44) | (138) | (130) | (512) | ||||||
Free Cash Flow and Adjusted Free Cash Flow | 811 | 1,760 | 5,745 | 5,661 |
SOURCE
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