Delta 9 Reports Record Revenue for Year End 2018
WINNIPEG, April 22, 2019 /CNW/ - DELTA 9 CANNABIS INC. (TSXV: NINE) (OTCQX: VRNDF) ("Delta 9" or the "Company"), is pleased to announce financial and operating results for the year ending December 31, 2018.
2018 Year End Financial Highlights
- Record operating revenues of $7.57M for the year ending December 31, 2018, up 702%, from $944,114 for the year ending December 31, 2017
- Record gross profit of $5.74M for the year ending December 31, 2018, up 1,200%, from $442,681 for the year ending December 31, 2017
- Net income was a loss of $8.61M for the year ending December 31, 2018, primarily as a result of expanding operations in advance of legalization of recreational use cannabis in the fourth quarter of 2018.
- The Company reported a strong financial position, with working capital of $20.7M and total assets of $46.0M, having raised over $30.7M in debt and equity during the year.
4th Quarter, 2018 Versus 3rd Quarter, 2018 Results
- Record operating revenues of $5.27M for the three-month period ending December 31, 2018, up 321%, from $1.25Mfor the three-month period ending September 30, 2018.
- Record gross profit of $3.34M for the three-month period ending December 31, 2018, up 118%, from $1.53M for the three-month period ending September 31, 2018.
- Prudent cost management narrowed quarterly loss to $2.17M ($0.02 per share) for the three-month period ending December 31, 2018 versus a loss of $2.23M ($0.03 per share) for the three-month period ending September 30, 2018.
- 2018 expansion increased the number of Delta 9 grow pods approved by Health Canada to 154 from 15, increasing anticipated annual production capacity to over 4,200 Kg of dried cannabis flower.
- Delta 9 announced its intention to become a preferred supplier of medical cannabis to Pharmasave, a national pharmacy chain with approximately 650 retail outlets.
- Delta 9 entered into a supply agreement for 2.3M grams of cannabis with the Province of Manitoba.
- Delta 9 entered into an agreement to supply 1,000 Kg of cannabis per year for 10 years to Auxly Cannabis Group Inc.
- Delta 9 now operates three retail stores, two in Winnipeg, Manitoba and one in Brandon, Manitoba. A fourth retail store in Thompson, Manitoba is scheduled to open in June, 2019.
2018 was a transformation year for Delta 9 as we proved our business model of using retrofitted shipping containers (Grow Pods) to grow cannabis successfully and produced a consistent high-quality cannabis product
said John Arbuthnot, CEO.
Our strategy of being one of Canada's only vertically integrated cannabis companies with licences for production, processing, distribution and retail operations is paying off and now producing significant financial results. The legalization of the adult consumer recreational market in October last year is only the beginning of many new and exciting opportunities for the Company
Selected Annual Information:
Summary of Quarterly Results:
A comprehensive discussion of Delta 9's financial position and results of operations is provided in the Company's Management Discussion & Analysis for the year ended December 31, 2018 filed on SEDAR and can be found at www.sedar.com.
Year-End Results 2018 Conference Call
Delta 9 has scheduled a conference call to discuss the results for its fourth quarter and year ended December 31, 2018. The conference call will be hosted April 23, 2018 at 9:00 a.m. Eastern Time by John Arbuthnot, Chief Executive Officer, and Jim Lawson, Chief Financial Officer, followed by a question and answer period.
Delta 9 Cannabis Inc. is a vertically integrated cannabis company focused on bringing the highest quality cannabis products to market. Delta 9's wholly-owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical and recreational cannabis and operates an 80,000 square foot production facility in Winnipeg, Manitoba, Canada. Delta 9 owns and operates a chain of retail stores under the Delta 9 Cannabis Store brand. Delta 9's shares trade on the TSX Venture Exchange under the symbol "NINE" and on the OTCQX under the symbol VRNDF. For more information, please visit www.delta9.ca.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Disclaimer for Forward-Looking Information
Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Company's future business plans and other matters. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Forward looking statements in this news release include statements relating to: (i) increases in Delta 9's cannabis production capacity; (ii) Delta 9's intentions to supply cannabis; and (iii) Delta 9's retail store expansion. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including the Company's actual financial results being different from its estimates as well as all risk factors set forth in the annual information form of Delta 9 dated May 31, 2018 which has been filed on SEDAR. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are urged to consider these factors carefully in evaluating the forward-looking statements contained in this news release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. These forward-looking statements are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.
SOURCE Delta 9 Cannabis Inc.