"2021 was a significant year for the Company. We completed a reverse take-over transaction and transitioned to a public company, all while launching initiatives aimed at growing the breadth and reach of our existing portfolio of chronic pain focused services and products," said
Financial and Operational Highlights
- Revenues continue to hold steady in spite of ongoing pandemic challenges, with
$2.7 million and$10.9 million in revenues for the three and twelve months endedDecember 31, 2021 respectively - The Company continues to prudently manage resources and expenses, ending the year with a positive working capital balance of
$2.0 million - The Company focused on the infrastructure development of a nurse practitioner-led telemedicine service model to extend its footprint in several provinces and improve patient access to care
- Signed a collaboration agreement with
Metro Ontario Pharmacies Limited ("Metro Ontario Pharmacies"), a subsidiary of Metro Inc. (TSX: MRU), pertaining to the implementation of Pathway's Medical Cannabis Management System ("MCS") inMetro Ontario Pharmacies' Metro Pharmacy and Food Basics Pharmacy bannered pharmacies acrossOntario
Summary of the Q4 2021 Financial Results
Revenues were
Gross margins were
Selling, general and administrative expenses ("SG&A") were
Other expenses were
The Company incurred a net loss of
Earnings before interest, tax, depreciation and amortization ("EBITDA")1 was a loss of
Cash as of December 31, 2021 was $2.6 million compared to $0.001 million as of December 31, 2020. The increase in cash is mainly a result of the $13.8 million gross proceeds from a private placement (
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1Non-IFRS financial measures
The non-IFRS measures included in this MD&A are not recognized measures under IFRS, and do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other issuers. When used, these measures are defined in such terms as to allow the reconciliation to the closest IFRS measure. These measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations from its perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. Despite the importance of these measures to management in goal setting and performance measurement, these are non-IFRS measures that may be limited in their usefulness to investors.
Working capital is a non-IFRS measure calculated as current assets less current liabilities. This measure is used to assist management and investors in understanding liquidity at a specific point in time. Management uses non-IFRS measures, such as EBITDA and Adjusted EBITDA to provide investors with a supplemental measure of the Company's operating performance and thus highlight trends in the Company's core business that may not otherwise be apparent when relying solely on IFRS financial measures. Management also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the valuation of issuers. Management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, prepare annual operating budgets, and to assess the Company's ability to meet its future debt service, capital expenditure and working capital requirements. The definition and reconciliation of EBITDA and Adjusted EBITDA used and presented by the Company to the most directly comparable IFRS measures follows below:
EBITDA and Adjusted EBITDA
EBITDA is defined as net (loss)/income adjusted for income tax, depreciation of property and equipment, amortization of intangible assets, interest on long-term debt and other financing costs, interest income, and changes in fair values of derivative financial instruments. Management uses EBITDA to assess the Company's operating performance. Adjusted EBITDA is defined as EBITDA adjusted for, as applicable, share-based compensation, loss of control of related company, fair value of guarantee, gain on disposal of intangible assets and goodwill, impairment of intangible assets, reverse takeover transaction costs, additional professional fees due to the Reverse Take Over transaction and Asset Acquisition Transaction. We use Adjusted EBITDA as a key metric in assessing our business performance when we compare results to budgets, forecasts and prior years. Management believes Adjusted EBITDA is a good alternative measure of cash flow generation from operations as it removes cash flow fluctuations caused by non-cash expenses, or extraordinary and non-recurring items, including changes in working capital. A reconciliation of net (loss)/income to EBITDA (and Adjusted EBITDA) is set out below:
For the three months ended | For the twelve months ended | |||||||||
2021 | 2020 | 2021 | 2020 | |||||||
Net (loss) attributable to shareholders | $ | (3,164,533) | $ | (372,811) | $ | (8,866,250) | $ | (374,506) | ||
Adjustments: | ||||||||||
Amortization of intangible assets | 60,063 | - | 140,577 | - | ||||||
Depreciation | 194,673 | - | 741,890 | - | ||||||
Finance expense* | 72,831 | - | 601,373 | - | ||||||
EBITDA | $ | (2,836,966) | $ | (372,811) | $ | (7,382,410) | $ | (374,506) | ||
Share-based compensation | 160,966 | - | 547,700 | - | ||||||
Loss of control of related company | 6,110 | - | 88,757 | - | ||||||
Related party bad debt expense | 365,707 | - | 365,707 | |||||||
Fair value (gain) loss of guarantee | (20,238) | - | 54,762 | - | ||||||
Impairment of intangible assets | 678,347 | - | 678,347 | - | ||||||
Gain on disposal of intangible assets and goodwill | - | - | (255,328) | - | ||||||
Reverse takeover transaction cost | - | - | 1,251,608 | - | ||||||
Additional professional fees due to RTO Transaction | - | - | 509,252 | - | ||||||
Additional professional fees due to Asset Acquisition Transaction | - | - | 112,891 | - | ||||||
Adjusted EBITDA | $ | (1,646,074) | $ | (372,811) | $ | (4,028,714) | $ | (374,506) | ||
*this figure includes interest expense, financing expense, fair value of financing facilities and accretion expense. |
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 that 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 applicable 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. Pathway disclaims 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. The
Consolidated Statements of Financial Position | |||||
As at | |||||
|
| ||||
Assets | |||||
Current | |||||
Cash | $ | 2,603,429 | $ | 588 | |
Restricted cash | 75,000 | - | |||
Accounts and other receivables | 811,587 | 34,771 | |||
Deferred cost | 54,978 | - | |||
Inventory | 340,340 | - | |||
Prepaids | 249,579 | - | |||
4,134,913 | 35,359 | ||||
Due from related parties | 117,362 | - | |||
Property and equipment | 2,914,078 | - | |||
Intangible assets | 691,447 | - | |||
504,901 | - | ||||
Investment in related company | 475,824 | - | |||
4,703,612 | - | ||||
Total assets | $ | 8,838,525 | $ | 35,359 | |
Liabilities and Shareholders' equity (deficiency) | |||||
Current | |||||
Acccounts payable and accrued liabilities | $ | 1,585,558 | $ | 379,568 | |
Current portion of lease liability | 545,515 | - | |||
Due to related parties | 20,459 | 30,296 | |||
2,151,532 | 409,864 | ||||
Lease liability | 2,292,993 | - | |||
Government loan payable | 67,574 | - | |||
2,360,567 | - | ||||
Total liabilities | 4,512,099 | 409,864 | |||
Shareholders' equity (deficiency) | |||||
Share capital | 42,630,724 | 1 | |||
Warrants | 1,866,866 | - | |||
Contributed surplus (deficiency) | (30,930,408) | - | |||
Deficit | (9,240,756) | (374,506) | |||
4,326,426 | (374,505) | ||||
Total liabilities and shareholders' equity (deficiency) | $ | 8,838,525 | $ | 35,359 |
Consolidated Statements of Loss and Comprehensive Loss | |||||||||
For the year ended | |||||||||
For the three months ended | |||||||||
2021 | 2020 | For the year ended | For the 104 days | ||||||
Revenue | $ | 2,669,658 | $ | - | $ | 10,895,372 | $ | - | |
Cost of sales | |||||||||
Consultants | 873,871 | - | 3,828,453 | - | |||||
Cost of goods sold | 191,901 | - | 735,951 | - | |||||
Clinic and medical supplies | 118,630 | - | 448,813 | - | |||||
Total cost of sales | 1,184,402 | - | 5,013,217 | - | |||||
Gross margin | 1,485,256 | - | 5,882,155 | - | |||||
Selling, general and administrative expenses | 3,703,059 | 372,811 | 11,706,178 | 374,506 | |||||
Loss before other items | (2,217,803) | (372,811) | (5,824,023) | (374,506) | |||||
Other expenses (income) | |||||||||
Reverse takeover transaction cost | - | - | 1,251,608 | - | |||||
Finance expense | 72,831 | - | 601,373 | - | |||||
Impairment of intangible assets | 678,347 | - | 678,347 | - | |||||
Share-based compensation | 160,966 | - | 547,700 | - | |||||
Amortization of intangible assets | 60,063 | - | 140,577 | - | |||||
Share of loss of equity-accounting investment | 48,464 | - | 138,239 | - | |||||
Loss of control of related company | 6,110 | - | 88,757 | - | |||||
Fair value loss of guarantee | (20,238) | - | 54,762 | - | |||||
Government grant | - | - | (25,558) | - | |||||
Gain on remeasurement of contingent consideration | (59,813) | - | (152,155) | - | |||||
Gain on disposal of intangible assets and goodwill | - | - | (255,328) | - | |||||
946,730 | - | 3,068,322 | - | ||||||
Loss before income taxes | (3,164,533) | (372,811) | (8,892,345) | (374,506) | |||||
Income tax expense | - | - | - | - | |||||
Net loss and comprehensive loss | (3,164,533) | (372,811) | (8,892,345) | (374,506) | |||||
Net loss attributable to: | |||||||||
Shareholders | (3,164,533) | (372,811) | (8,866,250) | (374,506) | |||||
Non-controlling interest | - | - | (26,095) | - | |||||
$ | (3,164,533) | $ | (372,811) | $ | (8,892,345) | $ | (374,506) | ||
Basic and diluted loss per share | $ | (0.03) | $ | (372,811) | $ | (0.16) | $ | (374,506) | |
Weighted average shares outstanding | |||||||||
Basic and diluted | 93,561,681 | 1 | 55,010,082 | 1 |
SOURCE
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