Experion Holdings Reports Record Revenue and First Quarter of Positive Adjusted EBITDA

Rhea-AI Summary

Experion Holdings Ltd. announced record financial results for Q1 2021, reporting gross revenue of $4.06 million, a 405% increase year-over-year, and a 53% increase from the prior quarter. The company achieved its first positive Adjusted EBITDA of $0.036 million, marking a significant turnaround from previous losses. Despite the challenges posed by COVID lockdowns, Experion processed and sold 481,632 grams of dried flower, representing a 51% growth from the prior quarter. The company plans to expand its product range and market share throughout 2021.

Positive

• Record gross revenue of $4.06 million for Q1 2021, a 405% increase YoY.
• Achieved first positive Adjusted EBITDA of $0.036 million.
• Sixth consecutive quarter of revenue growth.
• Processed and sold 481,632 grams of dried flower, a 51% increase from the previous quarter.
• Increased product SKUs from 8 to 13, including new product launches.

Negative

• Sales were negatively impacted by COVID lockdown measures, particularly in Ontario.

VANCOUVER, BC / ACCESSWIRE / April 28, 2021 / Experion Holdings Ltd. (the "Company" or "Experion") (TSXV:EXP)(OTCQB:EXPFF)(FRANKFURT:MB31), Canada's solution to craft cannabis supply and builder of premium cannabis brands including its sought after and popular brand Citizen Stash is pleased to report its first-quarter financial results for the three-month period ended February 28, 2021.

Mr. Jarrett Malnarich, CEO of Experion stated, "This was a record quarter for Experion, building on the momentum and foundation created in 2020. We continued to rapidly grow our brand presence as a trusted producer of premium cannabis products nationally and even though our sales were negatively impacted by COVID lockdown measures in this quarter ending February 28, 2021, especially in Ontario, we still delivered our sixth consecutive quarter of sequential sales growth. Within the quarter ended February 28, 2021, we realized gross revenue of $4.06 million, representing a 53% increase over the prior quarter, ending November 30, 2020, and a 405% increase over the same three-month period last year. Additionally, we achieved a major milestone recording our first positive adjusted EBITDA quarter in our company's history. With the planned addition of new SKUs and the opening of new markets in the coming quarters, it is expected that our leading premium brand Citizen Stash will continue to increase market share, delivering incremental growth potential throughout 2021."

Key Financial and Corporate Highlights:

• The Company had its first-ever positive Adjusted EBITDA quarter, posting $0.036 million for the quarter ended February 28, 2021 compared to a $(0.305) million loss in the prior quarter ending November 30, 2020 and an $(0.866) million loss in the prior year quarter ending February 29, 2020.
• Experion achieved revenue growth for the sixth consecutive quarter.
• Gross revenue increased 405% to $4.06 million in the quarter ended February 28, 2021 compared to $0.80 million in the prior year quarter ending February 29, 2020.
• Gross revenue of $4.06 million in the quarter ended February 28, 2021 increased 53% over the previous quarter's revenue, ending November 30, 2020, of $2.65 million.
• The Company processed and sold 481,632 grams of premium dried flower through retail distribution in the quarter ended February 28, 2021 compared to 317,933 grams in the previous quarter ending November 30, 2020, an increase of 51%.
• Experion's average price per gram realized of $8.35 in the quarter ended February 28, 2021 continues to be strong and reflect premium pricing in the Canadian market (net of excise tax, $7.23), as compared to $8.64 (net of excise tax, $7.86) for same three-month period in 2020.
• Increased product SKUs from 8 to 13 with the Ontario Cannabis Stores including the launching of the Citizen Stash edible gummy in the face of widespread COVID lockdown measures in Ontario.
• The Company launched two new strains in the quarter ending February 28, 2021; Sundae Driver and Fruity Pebbles (FPOG) to the British Columbia market.
• Experion is recognized as a top 20 supplier to the Ontario Cannabis Stores in total sales and volume within three months of entering the Ontario market.
• Well positioned balance sheet with a total of $13.3 million in assets and a net working capital balance (current assets less current liabilities) of $5.3 million.

Experion Holdings Ltd. Q1 2021 Financial Summary:

*1 Net of excise tax.

*2 Adjusted EBITDA is a non-GAAP measure used by management that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. Management defines adjusted EBITDA as comprehensive loss for the period, as reported, before interest, taxes, depreciation and amortization, and adjusted by removing share-based payments, and other one-time and non-cash items, including impairment losses and inventory write-downs. See reconciliation of "Adjusted EBITDA" in the Company's Management's Discussion & Analysis for the period ended February 28, 2021.

• Gross revenue increased 405% to $4.06 million in the quarter ended February 28, 2021 compared to $0.804 million in the prior year quarter ending February 29, 2020.
• Gross revenue of $4.06 million in the quarter ended February 28, 2021 increased 53% over the previous quarter, ending November 30, 2020 with revenue of $2.65 million.
• In the quarter ending February 28, 2021 the Company sold 481,632 grams of flower, which on its own represents 57% of the total grams sold for the entire fiscal year ending November 30, 2020.
• Gross profit before fair value adjustments was $0.911 million or 27% of net revenue in the quarter ended February 28, 2021, compared to $0.024 million or 3% of net revenue in the prior year quarter ending February 29, 2020.
  • Adjusted gross margin before fair value adjustments would have been 29%, excluding a small $0.072 million inventory write-down within costs of sales for the quarter ended February 28, 2021.
• The Company posted a net loss in the quarter ended February 28, 2021 of $(0.089) million compared to a net loss of $(1.3) million in the prior year quarter ending February 29, 2020.
• Adjusted EBITDA increased $0.341 million in the quarter ended February 28, 2021 to a positive $0.036 million, versus a $(0.305) million loss in the prior quarter ending November 30, 2020.

About Experion Holdings Ltd.

Experion Holdings Ltd. is the parent company of Experion Biotechnologies Inc., a Health Canada licensed cultivator and processor of Cannabis, based in Mission, B.C.

Experion Holdings Ltd. is invested in a portfolio of premium cannabis brands and products and is best known for its' rapidly growing Adult-Use premium brand Citizen Stash. The company's growth strategy incorporates a highly scalable aggregation and distribution business model to drive revenues across its national sales network.

Experion trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol "EXP" on the OTCQB Venture under the symbol "EXPFF" and on the Frankfurt Stock Exchange under the symbol "MB31".

For further information, please visit the Company's website www.experionwellness.com or contact Investor Relations, Email: IR@experionwellness.com.

Disclosure

This news release contains "forward-looking statements" and "forward-looking information" (collectively referred to herein as "forward-looking statements") within the meaning of applicable securities legislation. Such forward-looking statements include, without limitation, forecasts, estimates, expectations and objectives for future operations that are subject to a number of material factors, assumptions, risks and uncertainties, many of which are beyond the control of the Company.

Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "continues", "future", "forecasts", "potential", "outlook" and similar expressions, or are events or conditions that "will", "would", "may", "likely", "could", "should", "can", "typically", "traditionally" or "tends to" occur or be achieved. This news release contains forward-looking statements, pertaining to, among other things, the following: The Company's capital spending forecast and expectations of how it will be funded; near-term impacts from the COVID-19 pandemic; the Company's capital management strategy and financial position; the impact of governmental and Company measures implemented in response to the COVID-19 pandemic; the Company's outlook, activity levels, supply chains and sales channels; loss of markets; further legislative and regulatory developments involving cannabis or otherwise affecting the Company's business or its consumers generally, including delays in the issuance of licenses; competition; currency and interest rate fluctuations; and marketing costs.

Although the Company believes that the material factors, expectations and assumptions expressed in such forward-looking statements are reasonable based on information available to it on the date such statements are made, undue reliance should not be placed on the forward-looking statements because the Company can give no assurances that such statements and information will prove to be correct and such statements are not guarantees of future performance. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties.

Actual performance and results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to: known and unknown risks, including those set forth in the Filing Statement dated September 25, 2017 and/or the most recent annual and interim Management's Discussion and Analysis ("MD&A") (a copy of which can be found under Experion's profile on SEDAR at www.sedar.com); a significant expansion of COVID-19 pandemic and the impacts thereof; the Company's ability to raise the necessary capital or to be fully able to implement its business strategy; integration of acquisitions, competition, and uncertainties resulting from potential delays or changes in plans with respect to acquisitions, development projects or capital expenditures and changes in legislation; stock market volatility and the inability to access sufficient capital from external and internal sources; general economic, market or business conditions including those in the event of an epidemic, natural disaster or other event; global economic events; changes to the Company's financial position and cash flow; the availability of qualified personnel, management or other key inputs; currency exchange fluctuations; changes in political and security stability; potential industry developments; and other unforeseen conditions which could impact the Company. Accordingly, readers should not place undue importance or reliance on the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive and should refer to "Risk Factors" set out in the MD&A.

Statements, including forward-looking statements, contained in this news release are made as of the date they are given and the Company disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: Experion Holdings Ltd.

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FAQ

What were Experion Holdings' Q1 2021 financial results?

Experion Holdings reported a record gross revenue of $4.06 million for Q1 2021, a 405% increase year-over-year.

How did Experion Holdings' Adjusted EBITDA perform in Q1 2021?

Experion Holdings achieved its first positive Adjusted EBITDA of $0.036 million in Q1 2021.

What impact did COVID-19 have on Experion Holdings' sales in Q1 2021?

Sales were negatively impacted by COVID lockdown measures, especially in Ontario.

How much dried flower did Experion Holdings sell in Q1 2021?

Experion processed and sold 481,632 grams of dried flower, a 51% increase from the prior quarter.

What are the future growth plans for Experion Holdings?

Experion plans to expand its product range and increase market share throughout 2021.