NBLY Neighbourly Pharmacy Inc

Company announces the addition of 10 new locations to network of pharmacies

TORONTO, June 8, 2023 /CNW/ - Neighbourly Pharmacy Inc. ("Neighbourly" or the "Company") (TSX: NBLY), Canada's largest and fastest growing network of independent pharmacies, today announced its financial results for the twelve-week period and fiscal year ended March 25, 2023 (the "fourth quarter 2023" and "fiscal 2023", respectively).

"I'd like to congratulate the team on a successful year, and I look forward to continuing to realize Neighbourly's tremendous growth potential in the future," stated Skip Bourdo, the Company's Chief Executive Officer. "I am excited about Neighbourly's long runway, driven by both our robust acquisition pipeline and through the opportunities to drive incremental organic growth and profitability across our existing network. We have a full agenda of initiatives and a talented and capable team to accelerate Neighbourly's growth trajectory forward," concluded Mr. Bourdo.

Fourth Quarter 2023 Highlights

• Revenue for the fourth quarter increased to $190.6 million, up $78.3 million or 69.7%. 99% of the growth was driven by pharmacies acquired in the past 12 months.
• Same store sales¹ in the fourth quarter increased 1.6%.
• Adjusted EBITDA² for the fourth quarter increased to $19.6 million, up 73.4% due to the incremental contributions from pharmacies added to the Company's network.
• Announced two acquisitions subsequent to the quarter-end, adding 10 pharmacies and $6 million of Adjusted EBITDA on a proforma basis, with the purchase price consistent with the Company's historical multiples for transactions of this size.  Both transactions are expected to close by the end of June 2023.
• Initial network optimization initiative has resulted in the closure or consolidation of 4 existing locations.
• Announced a greenfield location in Kingston, Ontario, specializing in compounding and pain management.
• Pharmacy network to continue growing from a strong base of 291 locations across Canada.
• Adjusted Earnings per Share³ for the fourth quarter of $0.06, up compared to $0.05 for the fourth quarter of 2022.

Full Year 2023 Highlights

• Revenue for fiscal 2023 increased to $749.1 million, up $321.6 million or 75.2%, due to contributions from new acquisitions and organic growth in the existing store base.
• Same store sales¹ for fiscal 2023 increased 2.9%.
• Adjusted EBITDA² for fiscal 2023 was $79.2 million, an increase of $33.3 million or 72.6%.
• Adjusted Earnings per Share³ for fiscal 2023 of $0.45, up from $0.38 for fiscal 2022.
• Pro-Forma Revenue3 of $876.1 million and Pro-Forma Adjusted EBITDA3 of $99.3 million.
• Acquired 112 pharmacies and added one greenfield location in fiscal 2023.

 Selected Fourth Quarter and Fiscal 2023 Results

Declaration of Dividend

Neighbourly announced today that a quarterly dividend will be paid on August 3, 2023, to the Company's common shareholders of record as of July 6, 2023. The amount of the dividend will be $0.045 for each common share. This dividend is an "eligible dividend" for Canadian income tax purposes.

Conference Call and Webcast Information

A conference call will be held at 8:30AM Eastern on June 8, 2023, to discuss Neighbourly's financial results for the fourth quarter 2022. Participants may join the Company's conference call by dialing 416-764-8650 or 1-888-664-6383 (ID: 22502525). For those unable to participate, playback will be made available an hour after the event at 416-764-8677 or 1-888-390-0541, utilizing passcode 502525#. The webcast of the call will also be archived and available on the Company's website.

The conference call will also be available via webcast on the Investor section of Neighbourly's website at https://investors.neighbourlypharmacy.ca/events-and-presentations.

Neighbourly's unaudited consolidated financial statements and accompanying notes, and Management's Discussion and Analysis for the fourth quarter 2022 are available on the Company's website at www.neighbourlypharmacy.ca and on SEDAR at www.sedar.com.

About Neighbourly Pharmacy Inc.

Neighbourly is Canada's largest and fastest growing network of community pharmacies. United by their patient first focus and their role as essential and trusted healthcare hubs within their communities, Neighbourly's pharmacies strive to provide accessible healthcare with a personal touch. Since 2015, Neighbourly has expanded its diversified national footprint to include 291 locations, reinforcing the Company's reputation as the industry's acquirer of choice.

Non-IFRS Measures

This press release makes reference to certain non-IFRS measures, such as "Adjusted EBITDA", "Adjusted EBITDA Margin", "Pro-Forma Adjusted EBITDA", "Pro-Forma Revenue", "Adjusted Net Income (Loss)" and "Adjusted Earnings (Loss) Per Share." Refer to the Company's Management's Discussion and Analysis dated June 7, 2023 for the fiscal year and twelve weeks ended March 25, 2023, which is available under the Company's profile on SEDAR at www.sedar.com, for an explanation of the composition of those non-IFRS measures, an explanation of how these non-IFRS measures provide useful information to investors and the additional purposes for which management uses these non-IFRS financial measures. These measures are not recognized under International Financial Reporting Standards ("IFRS") and 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. These non-IFRS measures are used to provide readers 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 measures. We also believe that market participants 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 forecasts and to determine components of management compensation. See the financial table at the conclusion of this press release for a reconciliation of Adjusted EBITDA, Adjusted EBITDA Margin, Pro-Forma Adjusted EBITDA, Pro-Forma Revenue and Adjusted Net Income (Loss) to the most directly comparable IFRS measures.

Key-Performance Indicators

This press release makes reference to certain key performance indicators, such as Same-store sales and corporate, general & administrative costs. We monitor key performance indicators to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. These key performance indicators are also 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 measures. We also believe that securities analysts, investors and other interested parties frequently use industry metrics in the evaluation of issuers. Our key performance indicators may be calculated in a manner different than similar key performance indicators used by other companies.

Forward-Looking Statements

This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking information") within the meaning of applicable securities laws. Forward-looking information may relate to our future financial results and may include information regarding our financial position, business strategy, growth strategies, financial results, taxes, dividend policy, plans and objectives. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "expects", "estimates", "outlook", "forecasts", "projection", "prospects", "intends", "anticipates", "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", "will", "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, intentions, 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 or circumstances. Forward-looking information in this news release includes, among other things, statements relating to the expected completion of acquisitions and timing thereof, the expected impact of acquisitions on the Company's financial results and expected accretion, the payment of dividends, and same store sales improvements.

Forward-looking information is necessarily based on a number of opinions, estimates and assumptions that the Company considered appropriate and reasonable as of the date such statements are made in light of its experience and perception of historical trends, current conditions and expected future developments. Such estimates and assumptions include the satisfaction of all conditions of closing and the successful completion of probable acquisitions within the anticipated timeframe, including receipt of regulatory approvals. Further, forward-looking information is subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to risks and uncertainties related to probable acquisitions, including the failure to receive or delay in receiving regulatory approvals or otherwise satisfy the conditions to the completion such acquisitions, in a timely manner, or at all, and the reliance on information provided by the relevant sellers, as well as other factors discussed or referred to in the Company's Management's Discussion and Analysis for the fiscal year and twelve weeks ended March 25, 2023 (the "MD&A") and under the heading "Risk Factors" in the Company's annual information form (the "AIF") filed on June 8, 2023. If any of these risks or uncertainties materialize, or if the opinions, estimates, or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. The opinions, estimates or assumptions referred to above and described in greater detail elsewhere in the MD&A as well as in the "Risk Factors" section of the AIF should be considered carefully by prospective investors. The pro forma information set forth in this press release should not be considered to be what the actual financial position or other results of operations would have necessarily been had the probable acquisitions discussed herein been completed as, at, or for the periods stated.

Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents the Company's expectations as of the date of this press release (or as the date they are otherwise stated to be made) and are subject to change after such date. However, the Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events, or otherwise, except as required under applicable securities laws in Canada. All of the forward-looking information contained in this news release is expressly qualified by the foregoing cautionary statements.

Condensed Consolidated Statements of Income (Loss) and Comprehensive Income (Loss)

Condensed Consolidated Statements of Financial Position   

Condensed Consolidated Statements of Cash Flows

Reconciliation from IFRS to Non-IFRS Measures

The following tables provide a reconciliation of loss and comprehensive loss to Adjusted EBITDA, Adjusted Net Income (Loss) and Pro-Forma Adjusted EBITDA, and of Revenue to Pro-Forma Revenue, for the periods indicated:

SOURCE Neighbourly Pharmacy Inc.