Sunniva Announces Record Preliminary Q1 2019 Revenue Of CAD $14.0 Million (USD $10.5 Million), Representing Growth Of 169% Over Q1 2018
VANCOUVER, British Columbia, April 5, 2019 /CNW/ -- Sunniva Inc. ("Sunniva", the "Company", "we", "our" or "us") (CSE: SNN) (OTCQB: SNNVF), a North American provider of cannabis products and services, is pleased to announce preliminary revenue of $14.0 million for the three month period ended March 31, 2019. This represents a 169% increase over the $5.2 million in revenue generated in the comparative three-month period from 2018. All figures are reported in Canadian dollars ($), unless otherwise indicated.
In California, Sunniva began selling cannabis products in the first three months of 2019 through its wholly-owned subsidiary, CP Logistics, LLC ("CPL") with preliminary revenue of $10.0 million (USD $7.5 million). Revenue was comprised of product sales from premium flower, vape cartridges and concentrates. In March, Sunniva unveiled its first three in-house brands, Sun Fire, KYNDNESS and Herbella, and announced that additional super premium brands will be launched in conjunction with production from the 325,000 sq. ft. purpose-built greenhouse under construction in Cathedral City, California (the "Sunniva California Campus").
The Company's other wholly owned subsidiaries, Full-Scale Distributors, LLC ("FSD") and Natural Health Services Ltd. ("NHS"), contributed first quarter 2019 revenue of $2.3 million and $1.7 million, respectively.
In California, we now have the strategic pillars in place to ensure scalability and growth for our newly announced brands and we are very proud of our entire team for the execution and delivery of a very strong first quarter
said Dr. Anthony Holler, CEO of Sunniva.
Our $14.0 million in revenue during the first quarter is close to the total revenue generated by Sunniva in all of 2018. With strong leadership and operating assets producing premium cannabis products, supported by our recent distribution company acquisition, we continue to demonstrate our ability to achieve significant revenue growth and secure shelf space for our Sunniva brands throughout the state
Gross profit margin for the first quarter is expected to be between 30-35% due to operational ramp up costs in California. However, Sunniva reiterates its 2019 revenue estimate in California through CPL of $72-$78 million (USD $55-$60 million), with an estimated gross margin of 40-50%. This estimate does not include revenue from FSD, the Sunniva California Campus and NHS.
Sunniva will be providing a full corporate update on its Canadian and US operations along with its fourth quarter 2018 and fiscal 2018 financial results to be released on April 29, 2019. First quarter 2019 financial results will be reported before May 30, 2019.
For more information please visit: www.sunniva.com
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.
Sunniva, through its subsidiaries, is a vertically integrated cannabis company operating in the world's two largest cannabis markets – California and Canada. 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 uniquely 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 located at the greenhouse and our in-house marketing and distribution team will 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 news release includes statements containing certain "forward-looking information" within the meaning of applicable securities law ("forward-looking statements"), including, but not limited to, Sunniva's revenue and gross profit margin projections and the launch of Sunniva's house of brands and the completion of the Sunniva California Campus. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Preliminary Q1 2019 revenues and gross margin and estimated full year 2019 revenues and gross margin is based on current wholesale market price estimates for vape cartridges, disposable pens, concentrates and flower. Management believes that disclosing its current estimates and expectations regarding Q1 2019 and full-year 2019 revenue and gross margin will better allow investors to understand the current expected growth and development of Sunniva's business and that such information is particularly useful in the current year given that Sunniva has not previously reported significant revenues. Investors are cautioned that these estimates and expectations may not be appropriate, and should not be used, for other purposes. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.
SOURCE Sunniva Inc.