JohnCM
3 years ago
Cansortium Inc. Reports 2020 Third Quarter Financial Results
PR Newswire
MIAMI, Nov. 23, 2020
Another strong quarter highlighted by $3.6M of Adjusted EBITDA on $14.3M of revenue
MIAMI, Nov. 23, 2020 /PRNewswire/ - Cansortium Inc. (CSE: TIUM.U) (OTCQB: CNTMF) ("Cansortium" or the "Company"), a vertically-integrated provider of premium-quality medical cannabis, today announced financial results for its third quarter and nine months ended September 30, 2020. The Company's unaudited condensed interim consolidated financial statements and accompanying notes, along with the Management Discussion and Analysis (MD&A) are available under the Company's profile on SEDAR at www.sedar.com and are also accessible through a link on the Investor Relations section of the Company's website at www.cansortium.com.
Selected Third Quarter 2020 Financial Highlights
Consolidated revenue of $14.3 million, an increase of 94 percent or $6.9 million compared with consolidated revenue of $7.4 million in the third quarter of 2019.
Consolidated loss from operations of $(1.9) million, compared to loss from operations of $(8.1) million in the third quarter of 2019.
Consolidated Adjusted EBITDA(1) of $3.6 million, compared to Adjusted EBITDA(1) loss of $(2.1) million in the third quarter of 2019.
Consolidated net loss of $(8.9) million, or $(0.04) per diluted share, compared to consolidated net loss of $(11.3) million, or $(0.06) per diluted share for the same period last year.
During the third quarter of 2020, the Company opened its 21st medical marijuana dispensary in Coral Springs, FL. It operated 16 dispensaries during the comparable period in 2019. In October and November of 2020, the Company opened its 22nd and 23rd Florida dispensary in Coral Gables, FL and Kendall, FL, respectively.
Adjusted EBITDA is a non-IFRS financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. The Company calculates adjusted EBITDA from EBITDA plus (minus) unrealized loss (gain) on embedded derivatives, plus (minus) certain one-time non-operating expenses, as determined by management. Reconciliations from EBITDA and Adjusted EBITDA to Net Loss are included in the accompanying financial schedules.
Selected Year-to-Date 2020 Financial Highlights
Consolidated revenue of $37.7 million, an increase of 50 percent or $18.7 million compared with consolidated revenue of $19.0 million during the nine months ended September 30, 2019.
Consolidated income from operations of $1.3 million, compared to loss from operations of $(28.7) million during the nine months ended September 30, 2019.
Consolidated Adjusted EBITDA(1) of $7.0 million, compared to Adjusted EBITDA(1) loss of $(7.2) million during the nine months ended September 30, 2019.
Consolidated net loss of $(28.3) million, or $(0.14) per diluted share, compared to consolidated net loss of $(33.1) million, or $(0.18) per diluted share for the same period last year.
Adjusted EBITDA is a non-IFRS financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. The Company calculates adjusted EBITDA from EBITDA plus (minus) unrealized loss (gain) on embedded derivatives, plus (minus) certain one-time non-operating expenses, as determined by management. Reconciliations from EBITDA and Adjusted EBITDA to Net Loss are included in the accompanying financial schedules.
Full Year 2020 Outlook
The Company has continued to make progress on its targeted initiatives focused on growth and long-term shareholder value creation. In its home state of Florida, the Company secured an additional cultivation and production facility during the second quarter of 2020 with minimum capital outlay, with operations anticipated to commence in the fourth quarter of 2020, and has opened five of the six dispensaries planned for 2020.
In Pennsylvania, the Company is actively pursuing two additional dispensary locations to augment the strong sales of its existing Hanover dispensary. In Michigan, the Company enhanced the cultivation team on the ground with the engagement of Freedom Town.
Finally, in Texas, the Company recently secured an extension of its convertible notes to allow the Company to continue to seek longer-term solutions there.
The Company reiterates its full year 2020 outlook for consolidated revenues in the range of $55 million to $60 million and Adjusted EBITDA of approximately $14 million.
The forecast is based on projected revenues of at least $45 million for Cansortium's Florida operations with additional revenue from the Michigan, Pennsylvania and Texas markets.
JohnCM
3 years ago
FAST FORWARD TO ...
Bright Cannabis Outlook Leads to Bigger Estimates for 2022
The fundamentals of the cannabis industry continue to improve.
Jan 25, 2021
Real Money - The Street
by Deborah Borchardt
Stocks quotes in this article: JUSHF, TLLTF, CNTMF, SLGWF, TCNNF, INDXF, FLOOF
There are many reasons why the cannabis industry is looking brighter and as analysts sharpen their pencils, investors can begin to feel better about their investments.
The fundamentals of the cannabis industry continue to improve, leading to new estimates for 2022. Demand is strong in mature markets and expanding in nascent states. In addition to those markets, states such as Arizona have just begun selling legal adult-use cannabis, while New Jersey and New York take steps to create adult-use programs within 2021.
Canaccord Genuity has introduced 2022 estimates for the cannabis companies it covers. The analysts cite an improving regulatory backdrop at the federal level as Democrats have taken a majority position. They also point to cannabis being deemed an essential service during the pandemic, which has strengthened demand.
"The Canaccord Genuity U.S. Cannabis Index is up 121% vs. the S&P/TSX Venture Composite Index, which is up 51.6% over the year," wrote the analyst Bobby Burleson. "We nevertheless see room for further appreciation for stock prices, driven in part by generally improving execution to growth plans and potential for upside revisions in certain cases." He even said he believes multiples have room to expand.
All of these stocks, below, have a "Speculative Buy" rating.
Jushi Holdings
Burleson wrote, "While our 2022 estimates rank Jushi Holdings (JUSHF) within the top tier of MSO's on the EV/EBITDA basis (13.0x vs. 13.3x average) we believe there is headroom for the stock to appreciate." He cites the company's focus on limited license markets and believes that with the recent cash infusion, the company is poised to make acquisitions. "We expect cash flow generation and a solid net cash position along with outsized growth and high potential for upside, should continue to drive healthy stock performance and premium multiples for Jushi," said the analyst. His revenue estimate for 2022 is $350 million and he has an $8 price target.
The stock was recently trading at around $7.12.
Tilt Holdings
Burleson lowered his 2021 estimates for Tilt (TLLTF) , but that doesn't mean he thinks less of the company. He noted the current year's decline is due to its sale of the software company Blackbird, which was actually a loss leader for the company.
The analyst thinks the company's struggles are behind it and that it is positioned for profitable growth. "We are also taking a conservative view on vape hardware demand and plant touching assets this year, although both segments are still modeled to deliver health growth," he wrote. His revenue estimate for 2022 is C$260 million ($204 million) and his price target is C$1.00 ($0.79).
The stock was recently trading at around 45 cents.
Cansortium
Burleson likes Cansortium's (CNTMF) exposure to the Florida market with its 24 stores. "For 2022, we look for top line growth to be driven by a full year of output from broadened cultivation and retail footprint, including Michigan wholesale and expanded Pennsylvania retail," said the analyst. The company also has a first mover advantage in Texas, which has an extremely limited medical market.
His revenue estimate for 2022 is C$140 million ($109 million) and his price target is C$1.20 ($0.94), which was increased from C$0.70.
Slang Worldwide
"We see Slang (SLGWF) benefiting from recent expansion initiatives and improvements for demand in its core markets," said Burleson. He thinks partnerships should continue to offer a low cost means for market expansion like the company's partnership with Trulieve (TCNNF) for Massachusetts.
His revenue estimate for 2022 is for C$57.7 million ($45 million) and his price target is C$0.55 ($0.43).
Indus Holdings
"On the heels of an equity raise, the company's recently announced intention to build a new cultivation facility (online by 1H2022) has the potential to more than double the company's annual flower capacity, while subject to a much lower tax burden," wrote Burleson about Indus Holdings (INDXF) . His new estimates actually exclude the impact from the new facility because the terms haven't been completely ironed out.
His price target is C$2.75 ($2.16) and his revenue estimate for 2022 is C$111 million ($87 million).
The stock was recently trading at around $1.20.
Flower One
Burleson likes the opening of a Cookies dispensary (along with other notable stores) in Las Vegas for Flower One (FLOOF) and believes this will drive an uptick in weekly revenue. However, he was also lowering estimates for 2021 based on the effects of the pandemic on the Vegas market.
He has a revenue estimate for 2022 of C$117 million ($91 million) and a price target of C$0.50 ($0.39).
The stock was recently trading at around $0.19.
Final Thoughts
New legislation in the U.S. is already being proposed under the new Biden administration. Rep. Greg Steube (R-FL) filed a proposal last week, which Marijuana Moment described as being "Identical to a measure he sponsored last session. It would simply move marijuana from Schedule I to Schedule III of the Controlled Substances Act (CSA)."
Rescheduling is backed by President Biden, even though this isn't exactly what activists want. However, it would undoubtedly improve the way cannabis companies operate. They would probably become more profitable since they would be able to claim 280e business expenses, which they can't do with cannabis as a schedule 1 drug. It would also remove some restrictions that federal agencies face when working with cannabis.
JohnCM
3 years ago
TIME CAPSULE
Cansortium Inc. Reports Third Quarter 2019 Financial Results; Revises Full Year 2019 Outlook
Fri November 29, 2019
Cansortium (CNTMF) Inc. (CSE:TIUM.U) (OTCQB: CNTMF) ("Cansortium" or the "Company"), a vertically-integrated provider of premium-quality medical cannabis, today announced financial results of the third quarter and nine months ended September 30, 2019. The Company's unaudited condensed interim consolidated financial statements and accompanying notes, along with the Management Discussion and Analysis (MD&A) are available under the Company's profile on SEDAR at www.sedar.com and are also accessible through a link on the Investor Relations section of the Company's website.
Selected Third Quarter 2019 Financial Highlights Versus Pro-Forma Third Quarter 2018 Results(1)
Consolidated revenue increased 151 percent to $7.4 million, compared with pro-forma revenues of $2.9 million for the third quarter of 2018
Consolidated net loss totaled $(11.3) million, or $(0.05) per diluted share, compared to pro-forma net loss of $(6.8) million, or $(0.05) per diluted share for the third quarter of 2018
Consolidated EBITDA(2) totaled $(4.5) million, compared to pro-forma EBITDA(2) of $(5.4) million for the third quarter of 2018
Consolidated Adjusted EBITDA(2) totaled $(2.7) million, compared to Adjusted pro-forma EBITDA(2) of $(4.3) million for the third quarter of 2018
Selected Year-to-Date 2019 Financial Highlights Versus Year-to-Date 2018 Pro-Forma Results(1)
Consolidated revenue for the nine months ended September 30, 2019 increased 36 percent to $19.0 million, compared with pro-forma revenue of $14.0 million for the same period of 2018
Consolidated net loss for the nine months ended September 30, 2019 totaled $(33.1) million, or $(0.15) per diluted share, compared to pro-forma net loss of $(8.4) million, or $(0.06) per diluted share for the same period of 2018
Consolidated EBITDA(2) for the nine months ended September 30, 2019 totaled $(11.9) million, compared to pro-forma EBITDA(2) of $(5.3) million for the same period of 2018
Consolidated Adjusted EBITDA(2) for the nine months ended September 30, 2019 totaled $(9.3) million, compared to Adjusted pro-forma EBITDA(2) of $(5.7) million for the same period of 2018
Selected Events Subsequent to September 30, 2019
Opened 1 additional medical cannabis dispensary in Florida, for a total of 17 in Florida
Formed a Special Committee of the Board of Directors to develop and work with management to implement strategic reorganization and capital allocation initiatives to focus the Company's capital on sustainable profitable growth opportunities
Reached an agreement with co-founders José Hidalgo and Henry Batievsky, along with two other former senior executives, for their immediate return of shares representing more than 26 million common shares of the Company, in aggregate, representing approximately 14 percent of Cansortium's outstanding shares on an as-converted basis.
On November 14, 2019, the Company entered into a share purchase agreement with Brian Lagerwerf, Jennifer Weessies and 2638116 Ontario Inc. (their holding company) pursuant to which the Company agreed to sell 1931074 Ontario Inc. (the "Corporation") for an undisclosed amount (the "Transaction"). Brian Lagerwerf and Jennifer Weessies were the former owners of the Corporation and the Company's in-market partners in Canada. Closing of the Transaction is subject to obtaining approval from Health Canada as well as approval pursuant to the secured trust indenture dated May 23,2019.
Cansortium's Chief Executive Officer Jose Hidalgo commented, "Management is working closely with the Special Committee of the Board to ensure that the company is adequately capitalized and allocating its resources towards the opportunities with the most potential for near-term returns. We believe that the successful execution of our strategic reorganization plan will further serve to set a stronger foundation for long-term growth."
Revised Full Year 2019 Outlook
All projections related to anticipated future results are forward-looking in nature and are subject to risks and uncertainties that may cause actual results to differ, perhaps materially. Projections are predicated on the Company's ability to continue successfully implementing the strategic growth and cost-saving initiatives identified by the Special Committee of the Board. In addition, projections are based on the Company's ability to secure and effectively deploy its capital resources toward those initiatives.
Effective March 22, 2019, the Company became subject to U.S. IRS Tax Code Section 280E, under which gross profit from the Company's U.S. retail operations is taxed at U.S. federal corporate tax rates, without the opportunity to deduct any selling, general & administrative expenses attributable to the Company's U.S. operations. The Company's 2019 outlook also assumes that legal, regulatory and tax policies in key markets remain largely unaltered for the balance of the year.
As indicated in the accompanying financial statements, year-to-date Consolidated Net Loss is approximately $33 million, which includes over $10 million of expenses associated with the Company's Initial Public Offering completed in late March and subsequent financing activities completed during 2019. These expenses are not anticipated to re-occur in 2020.
The Company now anticipates full year 2019 revenue of approximately $30.0 million, compared to its prior 2019 revenue outlook of approximately $40.0 million, and full year 2019 operating loss of approximately $(30.0) million, unchanged from its prior 2019 operating loss outlook. This updated outlook primarily reflects a timing shift in the commencement of revenues from its Michigan business, from the fourth quarter of 2019 to the first quarter of 2020; lower revenues in Florida due to delays in new dispensary openings; and losses on the disposal of manufacturing assets in Puerto Rico and cultivation operations in Polk City, Florida that are expected to be recognized in the fourth quarter, offset by the estimated benefits of cost saving initiatives implemented during the fourth quarter.
The Company also announced that Marcos Pedreira, who had previously been chosen by the Board to become CFO of the Company so that Henry Batievsky could focus on production, has decided to remain Head of Finance. Mr. Batievsky will therefore continue to serve as the Company's CFO, as well as oversee production.
ABOUT CANSORTIUM INC.
Headquartered in Miami, Florida, and operating under the Fluent™ brand, Cansortium is focused on being the highest quality cannabis company in the State of Florida driven by unrelenting commitment to operational excellence from seed to sale. Cansortium has developed strong proficiencies in each of cultivation, processing, retail, and distribution activities, the result of successfully operating in the highly regulated cannabis industry. In addition to Florida, Cansortium is seeking to create significant shareholder value in the attractive markets of Texas, Michigan and Pennsylvania, where the Company has secured licenses and established operations.
Cansortium Inc.'s common shares and warrants trade on the CSE under the symbol "TIUM.U" and "TIUM.WT.U", respectively, and on the OTCQB Venture Market under the symbol (OTCQB: CNTMF).
nowwhat2
3 years ago
Investor Note: In addition to the 113,803,920 Common Shares that are listed and trading, there are 7,411,183 Proportionate Voting Shares, convertible into Common Shares at a ratio of 1:10, that are issued and outstanding but not listed. The total number of issued shares, assuming all are converted into the listed class, would be 187,915,750.
https://thecse.com/en/listings/life-sciences/cansortium-inc
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