VANCOUVER, British Columbia, April 29, 2019
VANCOUVER, British Columbia, April 29, 2019 /CNW/ — Sunniva Inc. (“Sunniva”, the “Company”, “we”, “our” or “us”) (CSE: SNN) (OTCQB: SNNVF), a North American provider of cannabis products and services, today released its financial results and management’s discussion and analysis for the three months and year ended December 31, 2018 and provided an operational update and outlook for its US and Canadian operations. All figures are reported in Canadian dollars ($), unless otherwise indicated. Sunniva’s financial statements are prepared in accordance with International Financial Reporting Standards.
“While we were faced with some challenges in 2018, our existing businesses continued to see revenue growth and we now have strategic verticals assembled in California which have allowed us to leverage our core assets and to launch brands covering numerous cannabis product categories,” said Dr. Anthony Holler, CEO of Sunniva.
“Hard work by our team in California throughout 2018 has begun to bear fruit in early 2019. The extraction facility became operational in Q3 2018 and, in conjunction with the acquisition of our distribution company, has enabled us to successfully launch two of our first three product brands into the California market in March 2019. Strong initial sales of our cannabis brands contributed over $10.0 million of revenue to our total preliminary revenue estimate of $14.0 million for Q1 2019 which is almost as much revenue as we generated all of last year.”
Corporate Strategy Update
In 2019, Sunniva plans to focus primarily on the ongoing development of our California assets and brands in California. In Canada, we continue to expand our Natural Health Services (“NHS”) operations with new leadership from Dr. Mark Kimmins. We have suspended operations on our Okanagan Falls property (the “Sunniva Canada Campus”) as we focus efforts on US operations, and we continue to review strategic initiatives in respect of our Canadian assets.
California Operations Update
Canada Operations Update
Financial Highlights – Year Ended December 31, 2018
Consolidated Financial Highlights expressed in 000’s of $, except per share amounts
Year Ended December 31, |
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2018 |
2017 Restated |
Change |
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Revenue |
$ 18,789 |
$ 16,072 |
$ 2,717 |
Cost of Goods Sold |
10,990 |
9,389 |
1,601 |
Gross Margin |
7,799 |
6,683 |
1,116 |
Selling, General and Administrative |
24,749 |
14,390 |
10,359 |
Share-based Payments |
8,247 |
3,981 |
4,266 |
Amortization Expense |
2,934 |
2,526 |
408 |
Loss from Operations |
(28,131) |
(14,214) |
(13,917) |
Net Loss |
$ (29,048) |
$ (17,513) |
$ (11,535) |
Basic Loss Per Share |
$ (0.91) |
$ (0.70) |
$ (0.21) |
Weighted Average Number of Shares |
31,805,910 |
25,128,623 |
6,677,287 |
Total Number of Shares Outstanding |
38,083,780 |
26,636,073 |
11,447,707 |
Results of Operations – Year Ended December 31, 2018
For the year ended December 31, 2018, the Company generated $18.8 million in revenue as compared to $16.1 million during the year ended December 31, 2017. NHS contributed $10.6 million, FSD contributed $8.1 million and CPL contributed $0.1 million during 2018. Net loss for the year ended December 31, 2018 was $29.0 million as compared to $17.5 million during the year ended December 31, 2017.
The key components contributing to the change in net loss from the year ended December 31, 2018 compared to the year ended December 31, 2017 comprise the following:
Recent Operating Developments Subsequent to December 31, 2018
Copies of our consolidated financial statements for the year ended December 31, 2018 and related management’s discussion and analysis of financial results are available on SEDAR at www.sedar.com.
The Company’s executive management will discuss the results during a conference call on Tuesday, April 30, 2019 at 11:00 am Eastern Time / 8:00 am Pacific Time. To participate in the call please dial 1-800-319-4610, or (604) 638-5340. An audio replay will be available shortly after the call by dialing 1-855-669-9658 or (604) 674-8052 and entering code 3178. The replay will be available for two weeks following the call.
For more information please visit: www.sunniva.com
To be added to the Sunniva email distribution list please register at www.sunniva.com/email-alerts
Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.
About Sunniva Inc.
Sunniva, through its subsidiaries, is a vertically integrated cannabis company operating in the world’s two largest cannabis markets – California and Canada. In Canada, Sunniva’s wholly owned subsidiary NHS operates medical cannabis clinics that provide educational and clinical services to patients. In California, Sunniva is focused on creating sustainable premium cannabis brands supported by our large-scale, purpose-built cGMP designed greenhouse and extraction facilities. We offer a steadfast commitment to safety and quality assurance providing cannabis products free from pesticides, which positions Sunniva in California as a leading provider of safe, high quality, reproducible products at scale. Through production from Phase One of our strategically positioned 325,000 square foot high technology greenhouse which is nearing completion and our fully operational Extraction Facility in California, we are launching Sunniva branded products in various product categories and price points including flower, pre-rolls, vape cartridges and premium concentrates. Sunniva branded products will be showcased within our flagship dispensary to be located at the greenhouse and our in-house marketing and distribution team will strive to ensure the placement of Sunniva branded products at licensed dispensaries throughout the state. Sunniva’s management and board of directors have a proven track record for creating significant shareholder value both in the healthcare and biotech industries.
This press release contains forward-looking statements within the meaning of applicable securities laws. All statements that are not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs of future performance, statements regarding the Company’s operations and growth opportunities, the expected capital costs and timing of completion of the Sunniva California Campus in late Q3, 2019 and projected production capacity for the Sunniva California Campus, the timing of completion of the Sunniva onsite dispensary in Q1 2020, the determination that the Company’s supply agreement with Canopy Growth Corporation will not proceed, the reduction in reliance on purchases of third-party biomass for the Extraction Facility as anticipated production from the Sunniva California Campus becomes available and the Company’s plans to launch Sunniva-branded products in various product categories including high quality distillate, premium concentrates, vape cartridges, flower, pre-rolls, and beverages, and the expansion of the Company’s distribution capabilities in California as a result of the recent acquisitions are “forward-looking statements.” Forward-looking statements can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others, the risk factors included in the Sunniva’s continuous disclosure documents available on www.sedar.com. These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. Although Sunniva has attempted to identify important risk factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other risk factors that cause actions, events or results to differ from those anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. Sunniva assumes no obligation to update any forward-looking statement, even if new information becomes available as a result of future events, new information or for any other reason except as required by law.
Company Contacts: |
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Sunniva Inc. |
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Dr. Anthony Holler |
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Chairman and Chief Executive Officer |
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Phone: (866) 786-6482 |
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Investor Contact: |
Media Contact: |
Phil Carlson / Erika Kay |
Katelyn Tumino / Tony Forde |
KCSA Strategic Communications |
KCSA Strategic Communications |
Phone: (212) 896-1233 |
Phone: (212) 896-1252 |
Email: [email protected] / [email protected] |
Email: [email protected] / [email protected] |