C21 Investments Reports Audited Financial Results for the Two Month Transition Period Ending March 31, 2024
-
In connection with C21's transition from a
January 31 fiscal year end to aMarch 31 fiscal year end, C21 reports the audited financial results for the two-month stub period fromFebruary 1, 2024 toMarch 31, 2024 -
Stub period Revenue of
$4.5 million and Cash Flow from Operations of$0.9 million -
Subsequent to the stub period end, C21 completed the acquisition of its third Silver State Relief dispensary in
Nevada , a 6,500 square-foot, purpose-built dispensary inSouth Reno
The Company's financial statements are prepared in accordance with
Audited Two-Month Stub Period Financial Highlights (
- Revenue of
$4.5 million - Gross Profit of 40%
- Earnings (Loss) Per Share of (
$0.00 ) - Operating Cash Flow of
$0.9 million ; positive Free Cash Flow1 of$0.9 million
Chief Executive Officer and President of C21,
Subsequent to the period end, the Company closed an acquisition of a third dispensary in
MCTO Status Update
As previously announced on
The MCTO prohibits the Company's management from trading in the securities of the Company until such time as the Annual Filings and Annual Stub Filings are filed. The MCTO does not affect the ability of any other shareholders of the Company to trade securities of the Company.
With the filing of the Annual Filings by the Company on
Non-GAAP Measures:
C21 reports its financial results in accordance with GAAP and uses a number of financial measures when assessing its results and measuring overall performance. Some of these financial measures and ratios are not calculated in accordance with GAAP. The Company refers to certain Non-GAAP financial measures such as "Free Cash Flow" in this news release. These measures do not have any standardized meanings prescribed by GAAP and may not be comparable to similar measures presented by other issuers. The Company considers these measures to be an important indicator of the financial strength and performance of its business. The Company believes the adjusted results presented provide relevant and useful information for investors because they clarify the Company's actual operating performance, make it easier to compare the Company's results with those of other companies and allow investors to review performance in the same way as the management of the Company. Since these measures are not calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, the Company's reported results as indicators of the Company's performance, and they may not be comparable to similarly named measures from other companies. The table below provides a reconciliation of Non-GAAP financial measures to the most directly comparable GAAP measures.
"Free Cash Flow" is defined as Cash Provided by Operating Activities from Continuing Operations in a period minus capital expenses of property and equipment. Management believes that Free Cash Flow, which measures the Company's ability to generate additional cash from our continuing business operations, is an important financial measure for use in evaluating the Company's financial performance. Free Cash Flow should be considered in addition to, rather than as a substitute for, consolidated net income as a measure of the Company's performance and net cash provided by operating activities as a measure of liquidity.
Free Cash Flow:
Fiscal Period Ended |
Two Months Ended |
Year Ended |
Cash Provided by Operating Activities |
|
|
Purchase of Property and Equipment |
(51,483) |
(521,579) |
Free Cash Flow |
|
|
Balance Sheet Summary:
(US$) |
Two Months Ended |
Year Ended |
|
||
Assets |
|
|
|
||
Cash |
3,260,568 |
2,408,526 |
|
||
Inventory |
2,866,054 |
2,708,721 |
|
||
Other current |
2,011,700 |
2,125,107 |
|
||
Current Assets |
8,138,322 |
7,242,354 |
|
||
Fixed Assets/ |
47,087,514 |
47,286,580 |
|
||
Total Assets |
55,225,836 |
54,528,934 |
|
||
|
|
|
|
||
Liabilities |
|
|
|
||
Accounts payable |
2,593,195 |
2,215,956 |
|
||
Income taxes payable |
10,230,423 |
9,719,872 |
|
||
Other notes, current lease |
2,223,539 |
2,229,312 |
|
||
Current Liabilities |
15,047,157 |
14,165,140 |
|
||
Lease liabilities |
9,120,396 |
9,192,588 |
|
||
Derivative liability and other |
84,871 |
124,198 |
|
||
Total Liabilities |
24,252,424 |
23,481,926 |
|
||
|
|
|
|
||
Shareholders' Equity |
30,973,412 |
31,047,008 |
|
||
Total Liabilities and Shareholders' Equity |
55,225,836 |
54,528,934 |
|
||
|
|
|
|
|
|
Summary Income Statement:
|
(US$) |
Two Months Ended |
Year Ended |
|
Revenue |
|
4,464,950 |
28,285,200 |
|
Cost of Sales |
|
2,688,650 |
17,135,434 |
|
Gross Profit |
|
1,776,300 |
11,149,766 |
|
|
Gross Margin% |
39.8 % |
39.4 % |
|
Total Expenses |
|
1,486,394 |
9,677,738 |
|
Income from Operations |
|
289,906 |
1,472,028 |
|
Income Tax Expense |
|
372,304 |
3,482,125 |
|
Net Income (Loss) |
|
(74,404) |
(3,305,285) |
|
|
|
|
|
|
About
Cautionary Note Regarding Forward-Looking Information and Statements:
This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "Forward-Looking Statements"). Forward-Looking Statements in this news release include, but are not limited to: the Company's belief that its change in fiscal year end will better align the Company with the reporting schedule of its peers and better equip our auditors to complete their work in a timely manner moving forward; the Company's focus on ramping its new store and continuing to pursue additional opportunities in the market; and the Company's belief that it has satisfied the conditions of the MCTO in order to have the MCTO revoked. Such Forward-Looking Statements represent the Company's beliefs and expectations regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Company's control.
Forward-Looking Statements are based on assumptions, estimates, analyses and opinions of management of the Company at the time they were provided or made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, including: achieving the anticipated results of the Company's strategic plans; and general economic, financial market, regulatory and political conditions in which the Company operates.
A variety of factors, including known and unknown risks, many of which are beyond the Company's control, could cause actual results to differ materially from the Forward-Looking Statements in this news release. Such factors include, without limitation: risks and uncertainties arising from: the inability to effectively manage growth; inputs, suppliers and skilled labour being unavailable or available only at uneconomic costs; the adequacy of the Company's capital resources and liquidity, including but not limited to, availability of sufficient cash flow to execute the Company's business plan (either within the expected timeframe or at all); changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws generally and adverse future legislative and regulatory developments involving medical and recreational marijuana; the risks of operating in the marijuana industry in
Although the Company believes that the assumptions and factors used in preparing, and the expectations contained in, the Forward-Looking Statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such Forward-Looking Statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Should assumptions underlying the Forward-Looking Statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
The Forward-Looking Statements contained in this news release are made as of the date of this news release, and the Company does not undertake to update any Forward-Looking Statements that are contained or referenced herein, except in accordance with applicable securities laws.
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.
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SOURCE