CubicFarm Systems Corp. Announces Filing of First Quarter Financial Statements and Provides Update on Cease Trade Order

Rhea-AI Summary

CubicFarm Systems Corp. (TSXV: CUB) has filed its Q1 2024 financial results. Key highlights include:

- Revenue of $0.02 million, down from $0.5 million in Q1 2023
- Corporate overhead reduced by 54% to $3.8 million
- Net loss of $4.7 million, improved from $9.0 million in Q1 2023
- Two significant sales agreements signed for HydroGreen machines

The company is operating under a cease trade order issued by the BCSC on July 15, 2024. CubicFarms expects to file Q2 2024 results by October 25, 2024, and will then apply to revoke the cease trade order.

Positive

• 54% reduction in corporate overhead expenses to $3.8 million
• Net loss decreased from $9.0 million to $4.7 million year-over-year
• Two significant sales agreements signed for HydroGreen machines

Negative

• Revenue decreased from $0.5 million to $0.02 million year-over-year
• Company is operating under a cease trade order issued by the BCSC
• Delayed filing of financial statements leading to cease trade order

Vancouver, British Columbia--(Newsfile Corp. - October 17, 2024) - CubicFarm® Systems Corp. (TSXV: CUB) ("CubicFarms" or the "Company"), a leading local chain agricultural technology company, announces that, further to its previous press release of October 2, 2024, the Company is pleased to announce that is has filed its first quarter financial and operating results for the three months ended March 31, 2024, and the related management's discussion and analysis for the three months ended March 31, 2024 and related filings (collectively, the "Q1 Filings"). The Q1 Filings can be accessed under the Company's profile at www.sedarplus.ca and will be available on the same day on CubicFarms' website at https://cubicfarms.com/investors/.

First Quarter Operational Highlights

• Revenue for the three months ended March 31, 2024, was $0.02 million, compared to $0.5 million in the prior year. As none of the ongoing projects were completed in the period, there was no significant revenue recognized. In the first quarter, however, the Company signed two significant sales agreements for the sale of eleven HydroGreen GLS 808 and two DGS machines as announced in the January 3, 2024, and March 20, 2024 press releases .

• Corporate overhead, which included general and administrative, selling, and research and development expenses was $3.8 million for the three months ended March 31, 2024, reduced by $4.4 million or 54% compared to $8.1 million in the prior year due to the Company's cost reduction plan that has continued through the year 2024.

• Net loss for the three months ended March 31, 2024 was $4.7 million, compared to $9.0 million in the prior year. The lower net loss in Q1 2024 was primarily due to the lower operating expenses as mentioned above.

"As we move forward, CubicFarms is committed to continue operating as a lean, efficient business focused on disciplined growth," said Interim CEO of CubicFarms and President of HydroGreen, John de Jonge. "We continue to explore all options. With HydroGreen, we are well-positioned to serve the dairy and cattle industries, which have a strong demand for our technology and feed solution. The world continues to face challenges such as climate change, drought, and land scarcity, and so we remain dedicated to providing innovative indoor growing solutions that conserve agricultural resources and provide superior nutritious feed to benefit dairy and beef animals."

The Company anticipates filing the interim financial statements for the three and six-month period ended June 30, 2024, the related management's discussion and analysis for the three-month period ended June 30, 2024, and related filings in respect of the period ended June 30, 2024 on or about October 25, 2024 (the "Q2 Filings").

The British Columbia Securities Commission (the "BCSC") as the principal regulator of the Company issued a failure-to-file cease trade order (the "FFCTO") against the Company on July 15, 2024, under Multilateral Instrument 11-103 - Failure-To-File Cease Trade Orders In Multiple Jurisdictions, prohibiting the trading in or the purchasing of any securities of the Company by any person or company in Canada, including trades in the Company's common shares made through the TSX Venture Exchange, except in accordance with the following conditions for so long as the FFCTO order remains in effect: a beneficial securityholder of the Company who is not, and was not at the date of the FFCTO an insider or control person of the Company, may sell securities of the Company acquired before the date of July 15, 2024 if both of the following apply: (a) the sale is made through a "foreign organized regulated market", as defined in section 1.1 of the Universal Market Integrity Rules of the Canadian Investment Regulatory Organization; and (b) the sale is made through an investment dealer registered in a jurisdiction of Canada in accordance with applicable securities legislation. A copy of the FFCTO has been posted to the BCSC website.

Following the filing of the Q2 Filings, the Company will file a revocation application to revoke the FFCTO. The Company will provide further updates as they become available.

About HydroGreen

HydroGreen's Automated Vertical Pastures™ technology utilizes a unique process to sprout grains, such as barley and wheat, in a controlled environment with minimal use of land, labour and water. HydroGreen's fully automated indoor growing technology performs all growing functions including seeding, watering, lighting, harvesting, and re-seeding-all with the push of a button-to deliver nutritious fresh forage for livestock without the typical investment in fertilizer, chemicals, fuel, field equipment, and transportation. Automated Vertical Pastures™ not only provide superior nutritious feed to benefit the animal but also enable significant environmental benefits to the farm.

About CubicFarms

CubicFarms is a leading local chain agricultural technology company developing and deploying technology to feed a changing world. Its proprietary ag-tech solutions enable growers to produce high quality, predictable produce and fresh livestock feed with HydroGreen Nutrition Technology, a division of CubicFarm Systems Corp. The CubicFarms™ system contains patented technology for growing leafy greens and other crops onsite, indoors, all year round. CubicFarms provides an efficient, localized food supply solution that benefits our people, planet, and economy.

For more information, please visit https://cubicfarms.com.

Contact info@cubicfarms.com for media or investors@cubicfarms.com for investor inquiries.

Forward-looking and other cautionary statements

Certain statements in this release constitute "forward-looking statements" or "forward-looking information" within the meaning of applicable securities laws, including, without limitation, statements with respect to: statements regarding the timing, review, completion and filing of the Q2 Filings, the revocation of the FFCTO, the two significant sales agreements for the sale of eleven HydroGreen GLS 808 and two DGS machines, potential growth, a strong and future prospects and demand for our technology and solutions. Such statements involve known and unknown risks, uncertainties, and other factors and assumptions which may cause the actual results, performance, or achievements of CubicFarm Systems Corp., or industry results, to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements or information including, without limitation, the risk of the Company not filing the Q2 Filings on time and the other factors disclosed under "Risk Factors" in the Company's annual information form for the year ended December 31, 2022, and those risks described in other documents incorporated or deemed to be incorporated by reference in the prospectus. Such statements can be identified by the use of words such as "intend", "expect", "believe", "plan", "anticipate", "estimate", "scheduled", "forecast", "predict", and other similar terminology, or state that certain actions, events, or results "may", "can", "could", "would", "might", or "will" be taken, occur, or be achieved.

These statements reflect the Company's current expectations regarding future events, performance, and results and speak only as of the date of this news release. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Except as required by securities disclosure laws and regulations applicable to the Company, the Company undertakes no obligation to update these forward-looking statements if the Company's expectations regarding future events, performance, or results change.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/227032

FAQ

What was CubicFarm Systems Corp's (CUBXF) revenue for Q1 2024?

CubicFarm Systems Corp's revenue for Q1 2024 was $0.02 million, compared to $0.5 million in the same period of the previous year.

How much did CubicFarm Systems Corp (CUBXF) reduce its corporate overhead in Q1 2024?

CubicFarm Systems Corp reduced its corporate overhead by 54% or $4.4 million, from $8.1 million in Q1 2023 to $3.8 million in Q1 2024.

When does CubicFarm Systems Corp (CUBXF) expect to file its Q2 2024 financial results?

CubicFarm Systems Corp anticipates filing its Q2 2024 financial results on or about October 25, 2024.

What is the current status of CubicFarm Systems Corp's (CUBXF) stock trading?

CubicFarm Systems Corp is currently under a failure-to-file cease trade order issued by the British Columbia Securities Commission on July 15, 2024, prohibiting trading of its securities in Canada.