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29.10.2020 22:50
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Namaste Technologies Reports Third Quarter 2020 Financial Results
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PR Newswire
TORONTO, Oct. 29, 2020
~Company reports a 49% Q3 year-over-year increase in net revenue for 2020 third quarter revenue~
TORONTO, Oct. 29, 2020 /PRNewswire/ - Namaste Technologies Inc. ("Namaste" or the "Company") (TSXV: N) (FRANKFURT: M5BQ) (OTCMKTS: NXTTF), an online platform for cannabis products, accessories, and responsible education, today reported its financial results for the third quarter ended August 31, 2020. All financial figures are in Canadian dollars unless otherwise indicated.
Namaste's third quarter results continue to build on the revenue growth success on a year-over-year basis as the Company solidifies its position within the cannabis value chain. Namaste's wholly-owned subsidiary, CannMart Inc. ("CannMart"), through its distribution channels, continues to make a significant contribution to Namaste's revenue stream as the Company seeks to expand product lines, improve operational efficiencies, grow revenue, and increase gross margins. In this third quarter, the Company continued to drive internal changes, improvements, and investments to strengthen its foundation for long term growth. As a result of these efforts, and subsequent to quarter end, the Company launched VendorLink, a proprietary platform that connects consumers with cannabis brands, vendors, and retailers forming a true cannabis marketplace experience.
Third Quarter Highlights
- Net Revenue increased 49%, to $5.6 million in the third quarter ended August 31, 2020 compared to $3.8 million in the same period last year.
- The net segment revenue for CannMart, Namaste's core growth engine, increased approximately 1586% to $2.3 million in the third quarter ended August 31, 2020 compared to the comparable period in 2019, excluding excise tax.
- Cannabis revenue represented 40.6% of net consolidated revenues for the third quarter ended August 31, 2020 versus 3.6% for the third quarter ended August 31, 2019.
- Reported third quarter ended August 31, 2020 net loss of $7.8 million compared to $14.7 million in the same quarter last year. The improvement reflects, in part, CannMart Inc.'s introduction of new distribution channels, restructuring efforts, and resulting business improvements. Included in the net loss for the third quarter ended August 31, 2020 was $1.7 million in unrealized, non-cash, foreign exchange losses.
Subsequent to the end of the third quarter, the Company introduced:
- VendorLink, a proprietary scalable platform for brands and vendors to upload and sell their cannabis accessories products through CannMart.com; and
- The facilitation of online recreational sales by a licensed retailer in Saskatchewan.
"We continue to make progress shifting our sales to cannabis as CannMart posted another quarter with significant year-over-year growth of revenue in the third quarter of 2020 versus the same quarter last year," said Meni Morim, CEO of Namaste. "CannMart's distribution channels continue to make a significant contribution to Namaste's revenue stream. The work completed in the third quarter of 2020 around internal changes, improvements, and investments to strengthen its foundation for long term growth including the successful launch of VendorLink, our proprietary scalable platform for brands and vendors to upload and sell their cannabis accessories products through CannMart.com."
"Furthermore, the launch of VendorLink which facilitates sales of licensed retailers' recreational cannabis products available through CannMart.com in the province of Saskatchewan marks an important milestone," added Morim.
Summary of Consolidated Financial Results
Net revenue for the third quarter ended August 31, 2020 was $5.7 million, an improvement of 49% compared to $3.8 million for the third quarter of 2019. Gross margin as a percentage of net revenue (before inventory adjustment) for the third quarter ended August 31, 2020 was 9.7% compared to 20.7% for the same period last year. As illustrated on the chart below, cannabis revenue is demonstrating strong growth on a year-over-year basis and becoming a major component of total revenues.
Operating expenses decreased $999,458 or 13% for the third quarter ended August 31, 2020 in comparison to the same period last year. The change reflects a decrease in professional fees and share based compensation offset by an increase in salaries and office and general costs.
Adjusted EBITDA for the third quarter ended August 31, 2020 was a loss of $5.4 million, compared to a loss of $5.7 million for the third quarter ended August 31, 2019. Net loss for the third quarter ended August 31, 2020 was $7.8 million compared to $14.7 million in the same period last year. The improvement in the net loss is primarily attributed to a decrease in restructuring and impairment charges offset with an increased foreign exchange loss.
During the nine months ended August 31, 2020, the Company's cash and cash equivalents position declined by $24.2 million resulting in $13.6 million cash on hand at the end of the third quarter. Approximately, $14.9 million was used to fund operating losses, while the remainder primarily reflects the Company's investment in inventory and property and equipment ("P&E"). The increased investment in inventory was in preparation for this year's Black Friday and Cyber Monday and to further support the continued growth in cannabis revenue. The P&E primarily represents leasehold improvements for a dedicated facility designed specifically to produce oil, extract, and other products allowing the Company greater control over its input costs while driving increased margins.
For further details, the complete Financial Statements for the third quarter ended August 31, 2020 and the related Management's Discussion & Analysis can be accessed on the Company's SEDAR profile at www.sedar.com.
COVID-19 UPDATE
COVID-19 continues to be an unprecedented challenge for the global community. In response to this very serious health risk, management employed procedures to mitigate its effects on the business and ensure the continued health and safety of its employees, vendors, partners and customers as the first quarter was coming to a close. Although these challenges still persist, management believes that appropriate actions have been taken and the business is well positioned to operate with limited disruption.
NON IFRS FINANCIAL MEASURES
Management evaluates the Company's performance using a variety of measures, including "EBITDA" and "Adjusted EBITDA". The non-IFRS measures discussed below should not be construed as an alternative to other financial measures determined in accordance with IFRS. These measures do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies.
The Company believes these non-IFRS financial measures provide useful information to both management and investors in measuring the financial performance and financial condition of the Company.
Management uses these and other non-IFRS financial measures to exclude the impact of certain expenses recognized under IFRS when analyzing underlying operating performance and cash impact. From time to time, the Company may exclude additional items if it believes doing so would result in a more effective analysis. The exclusion of certain items does not imply they are non-recurring.
| | | Three months ended | Nine months ended | ||||||
| Notes | 31-Aug-20 | 31-Aug-19 | 31-Aug-20 | 31-Aug-19 | |||||
| Net loss | | $ | (7,833,495) | $ | (14,652,118) | $ | (20,067,532) | $ | (33,562,925) |
| Income tax | (i) | 45,309 | (51,582) | 78,057 | (217,354) | ||||
| Depreciation and amortization | (i) | 453,662 | 513,003 | 1,686,131 | 1,687,557 | ||||
| EBITDA | | (7,334,524) | (14,190,697) | (18,303,345) | (32,092,722) | ||||
| Other income | (ii) | (235,487) | (304,329) | (513,612) | (1,060,074) | ||||
| Impairment of goodwill | (iii) | - | - | 322,887 | - | ||||
| Share-based compensation | (iii) | 422,349 | 683,438 | 601,030 | 3,265,647 | ||||
| Restructuring and other costs | (iii) | - | 2,368,737 | (1,300,000) | 9,294,840 | ||||
| Impairment loss on loans receivable | (iii) | - | 3,578,400 | - | 3,578,400 | ||||
| Impairment of investment in associate | (iii) | - | - | 1,016,127 | - | ||||
| Share of associates' loss, net of tax | (iv) | - | 1,464,565 | 329,652 | 1,561,667 | ||||
| Foreign exchange | (i) | 1,737,576 Werbung Mehr Nachrichten zur Next Gen Metals Aktie kostenlos abonnieren
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