/NOT FOR DISSEMINATION IN THE UNITED
STATES OR FOR DISTRIBUTION TO UNITED
STATES WIRE SERVICES/
EDMONTON, June 26, 2019 /CNW/ - Fire & Flower Holdings
Corp. ("Fire & Flower" or the "Company")(1) (TSXV:
FAF), today announced its financial and operational results for the
thirteen weeks ended May 4, 2019.
Financial and Operational Highlights for the thirteen weeks
ended May 4, 2019
- System sales of $10,895,626 and
recognized revenue of $9,538,348 at a
gross margin of 38.5%, compared to $Nil for the thirteen weeks
ended May 5, 2018.
- 17 branded cannabis retail stores operating system-wide across
the provinces of Alberta,
Saskatchewan and Ontario.
- Received $34,544,793 of net
proceeds from the private placement which closed on November 1, 2018, upon completion of the
Company's Qualifying Transaction and subsequently became listed on
the TSX Venture Exchange.
Subsequent Financial and Operational Highlights post
May 4, 2019
- On May 14, 2019, acquired 4
retail cannabis store licenses in Saskatchewan.
- On May 28, 2019, acquired 2
licenced retail cannabis stores in Vancouver, British Columbia and intends to
open these stores at its earliest opportunity.
- On May 29, 2019, acquired a
proposed cannabis retail store in the town of Banff, Alberta.
- On June 6, 2019 Fire & Flower
announced a bought deal private placement for total gross proceeds
of $25,000,000 with an agents' option
for additional gross proceeds up to $5,000,000.
- On June 9, 2019, achieved system
sales of $25,000,000.
"These results provide a solid foundation upon which Fire &
Flower will continue to execute on our growth strategy. Our growth
plan is well funded and in addition to the strength of our retail
network, we have set ourselves apart as a modern retail company
through the Hifyre digital cannabis platform that is reflective in
our financial performance" shared Trevor
Fencott, Fire & Flower's Chief Executive Officer.
Selected Summary of Quarterly Results
Statement of Loss
and Comprehensive Loss
|
Q1
2019
|
Q1
2018
|
$
|
%
|
(in thousands of
dollars, except per share amounts)
|
Ended
|
Ended
|
Change
|
change
|
|
4-May-19
|
5-May-18
|
|
|
Revenue
|
$
9,538
|
$ -
|
$ 9,538
|
NM
|
Cost of goods
sold
|
5,870
|
-
|
5,870
|
NM
|
Gross
margin
|
3,668
|
-
|
3,668
|
NM
|
Expenses
|
8,962
|
2,470
|
6,492
|
>100%
|
Other
expenses
|
(11,763)
|
-
|
(11,763)
|
NM
|
Net loss and
comprehensive loss
|
(17,058)
|
(2,470)
|
(14,587)
|
>100%
|
Net loss per
share, basic and diluted
|
$
(0.17)
|
$
(0.05)
|
|
|
NM – Not
meaningful
|
|
|
|
|
During the thirteen weeks ended May 4,
2019, the Company generated revenue of $9.5 million including cannabis and
cannabis-related accessory sales of $9.0
million and digital development revenue of $0.5 million. Revenues are expected to continue
to increase as the Company acquires new licences and opens
additional retail cannabis stores, subject to the issuance of new
licenses and the entry of the Company into markets that permit
private cannabis retail stores.
Total gross profit for the thirteen weeks ended May 4, 2019 was $3.7
million or 38.5% of revenue with retail and wholesale
operations delivering $3.2M, or
35.6%, gross profit. Excluding digital development revenue, gross
profit for the thirteen weeks ended May 4,
2019 was $3.2 million or 35.6%
of the corresponding revenue.
The Company's major expenses incurred during the thirteen weeks
ended May 4, 2019 are related to
salaries and benefits of $3.3
million, depreciation and amortization of $1.5 million, share based payment of $1.3 million, consulting and professional fees of
$1.3 million and $0.7 million in other operating costs.
Included in other expense primarily is a $9.0 million charge related to the amendment of
the Company's convertible debentures in order to maintain
compliance with various provincial regulations relating to the
ownership of a cannabis retail licensee by a cannabis licensed
producer and $1.8 million for costs
associated with the Qualifying Transaction.
The Company recorded a net comprehensive loss of $17.1 million, or a net loss per share of
$0.17.
Retail Operations Update
The Company intends to establish the leading brand of cannabis
retail stores in provinces across Canada where private retail is permitted.
There are currently 21 licensed Fire & Flower branded stores
operating across Alberta,
Saskatchewan and Ontario. The Company will continue to refine
its retail experience using consumer insights collected within the
Hifyre digital cannabis platform.
Hifyre Digital Cannabis Retail Platform
The Company continues to develop and commercialize the Hifyre
digital cannabis platform that collects and analyzes consumer data
to develop insights around purchase preferences. The Hifyre
platform provides real time reporting and analysis to the Company's
marketing, retail experience and merchandising teams and is
supplied to Licensed Producers to assist in demand forecasting,
product development and sales reporting.
Fire & Flower's financial statements and management
discussion and analysis for the period are available on Fire &
Flower's SEDAR profile at www.sedar.com and on Fire &
Flower's website at www.fireandflower.com/investor-relations/.
About Fire & Flower
Fire & Flower is a leading purpose-built, independent
adult-use cannabis retailer poised to capture significant
Canadian market share. Fire & Flower guides consumers through
the complex world of cannabis through education-focused,
best-in-class retailing while the HiFyre digital platform connects
consumers with cannabis products. Fire & Flower's leadership
team combines extensive experience in the cannabis industry with
strong capabilities in retail operations.
Fire & Flower Holdings Corp. owns all issued and outstanding
shares in Fire & Flower Inc., a licensed cannabis retailer in
the provinces of Alberta and
Saskatchewan and is a consultant
and licensor to Fire & Flower-branded retail locations in
province of Ontario.
(1) From the February 2 to February
9, 2019, Fire & Flower was known as Cinaport Acquisition
Corp. II. On February 13, 2019 Fire
& Flower completed its Qualifying Transaction by way of a
three-cornered amalgamation, pursuant to which 11048449 Canada
Inc., a wholly-owned subsidiary of Fire & Flower amalgamated
with Fire & Flower Inc. ("Pre QT F&F") to form the company
now known as Fire & Flower Inc. ("Post QT F&F"). All
references herein to the "Company" or "Fire & Flower" refer to
Fire & Flower, Pre QT F&F, Post QT F&F and all
subsidiaries thereof on a consolidated basis.
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 Fire & Flower at the date the
statements are made based on information then available to the
Fire & Flower. Various factors and assumptions are
applied in drawing conclusions or making the forecasts or
projections set out in forward-looking statements.
Forward-looking statements are subject to and involve a number of
known and unknown risks and uncertainties, many of which are beyond
the control of the Fire & Flower, which may cause
Fire & Flower's actual performance and results to differ
materially from any projections of future performance or results
expressed or implied by such forward-looking statements. No
assurance can be given that the expectations reflected in
forward-looking statements will prove to be correct.
Fire & Flower assumes no obligation to publicly update or
revise forward-looking statements to reflect new information,
future events or otherwise, except as expressly required by
applicable law.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
SOURCE Fire & Flower Holdings Corp.