IM Cannabis Reports Fourth Quarter and Fiscal Year 2022 Financial Results; Revenues in 2022 Increased 60% Year-over-Year
IM Cannabis Corp. (NASDAQ: IMCC) reported strong financial results for Q4 and the full year 2022, with a 60% revenue increase year-over-year, totaling $54.3 million. Q4 revenue reached $14.5 million, up 46%. Dried flower sales grew significantly, with 6,794kg sold in 2022 at an average price of $7.12 per gram. The company focused on streamlining operations by exiting Canada and strengthening its position in Israel and Germany. Despite these gains, operating losses increased to $30.8 million in 2022. Net loss from continuing operations was $24.9 million. The firm ended the year with $2.4 million in cash and significant goodwill impairment totaling $107.8 million.
- Revenue increased by 60%, totaling $54.3 million in 2022.
- Q4 2022 revenue reached $14.5 million, a 46% increase year-over-year.
- Dried flower sales in 2022 were 6,794kg, with an average price of $7.12 per gram.
- Operating loss increased to $30.8 million in 2022.
- Net loss from continuing operations was $24.9 million.
- Goodwill impairment of $107.8 million was recorded.
Company to continue its focus on the Israeli and German markets with a primary goal of sustainably increasing revenue in each of these core markets and accelerating path to profitability, while actively managing costs and margins
TORONTO, and GLIL YAM, Israel, March 29, 2023 /PRNewswire/ -- IM Cannabis Corp. (the "Company" or "IMC") (NASDAQ: IMCC) (CSE: IMCC), an international medical cannabis company, today announced its financial results for the fourth quarter and full year ended December 31, 2022. All amounts are reported in Canadian dollars unless otherwise stated.
Management Commentary
"The fourth quarter marked another pivotal moment on our trajectory to growth and profitability," said Oren Shuster, Chief Executive Officer of IMC. "By commencing our exit from Canada, and the restructuring initiatives announced a few weeks back, we will be able to better focus our resources on growth opportunities in Israel, Germany and elsewhere in Europe. We are determined to continue with our strategic plan by maximizing efficiencies to create a leaner and more flexible organization to better suit the current market environment and our short- to mid-term objectives. We will continue building on the increasing demand and positive momentum in Israel and Germany, supported by strategic alliances with Canadian suppliers and a highly skilled sourcing team, to cement our leadership position in the markets we operate in."
Q4 & Full Year 2022 Financial Results
- Revenues from Continuing Operations[1] for the year ended December 31, 2022 were
$54.3 million , compared to$34.1 million in 2021, an increase of60% . Revenues from Continuing Operations for Q4 2022 were$14.5 million , compared to$9.9 million in Q4 2021, an increase of46% . The increase in revenues is primarily attributed to the increase in the quantity of medical cannabis products sold, as well as from a higher average selling price per gram the Company realized from its portfolio of premium branded cannabis products in Israel. Additional increases were derived from the Company's organic growth and related synergies in the areas where it operates.
- Total Dried Flower sold in 2022 was 6,794kg at an average selling price of
$7.12 per gram, compared to 4,278kg sold in 2021 at an average selling price of$6.18 per gram. This is mainly attributable to the higher average selling price per gram the Company recognized through the acquisition of Israeli pharmacies. Total dried flower sold in Q4 2022 was 2,334kg at an average selling price of$5.19 per gram, compared to 1,220kg in Q4 2021, at an average selling price of$6.87 per gram.
- Gross profit from Continuing Operations for the year ended December 31, 2022 was
$9.2 million , compared to$6.3 million in 2021, an increase of46% . Gross profit from Continuing Operations for Q4 2022 was$2.6 million , compared to$0.98 million in Q4 2021, an increase of165% .
- Gross Margin [2] from Continuing Operations in 2022 was
21% , compared to25% in 2021. Gross Margin in Q4 2022 was19% , compared to11% in Q4 2021.
- General and Administrative Expenses from Continuing Operations in 2022 were
$21.5 million , compared to$17.2 million in 2021, an increase of25% . General and Administrative Expenses from Continuing Operations in Q4 2022 were$9.8 million , compared to$5.4 million in Q4 2021, an increase of81% . The increase in the general and administrative attributable mainly to non-recurring costs related to fair value adjustment of Company's purchase option of a pharmacy.
- Selling and Marketing Expenses from Continuing Operations in 2022 were
$11.5 million , compared to$6.7 million in 2021, an increase of72% . Selling and marketing expenses from Continuing Operations in Q4 2022 were$3.1 million , compared to$2.9 million in Q4 2021, an increase of7% . The increase was mainly attributed to the Company's increased marketing efforts in Israel, increased distribution expenses related to the growth in sales, and consolidation of selling and marketing expenses of entities acquired in 2021.
- Total operating expenses from Continuing Operations in 2022 were
$40 million , compared to$29.4 million in 2021. Total operating expenses in Q4 2022 were$13.3 million , compared to$9.7 million in Q4 2021.
- Operating Loss from Continuing Operations in 2022 was
$30.8 million , compared to$23 million in Q4 2021. Operating Loss from Continuing Operations in Q4 2022 was$10.7 million , compared to$8.7 million in Q4 2021.
- Non-IFRS Adjusted EBITDA loss from Continuing Operations in 2022 was
$11.5 million , compared to an Adjusted EBITDA loss of$14.3 million in 2021. Non-IFRS Adjusted EBITDA loss from Continuing Operations in Q4 2022 was$1.9 million , compared to an Adjusted EBITDA loss of$9.0 million in Q4 2021. The decrease is mainly attributable to improved performance of the Company's general and administrative expenses such as insurance cost reduction, cost efficiencies from synergies and other corporate expenses reduction.
- Net Loss from Continuing Operations in 2022 was
$24.9 million , compared to$0.7 million in 2021. Net Loss from Continuing Operations in Q4 2022 was$9.7 million , compared to$8.4 million in Q4 2021.
- Basic Loss per Share from Continuing Operations in 2022 was
$3.13 , compared to a gain of$0.02 per Share in 2021. Basic Loss per Share in Q4 2022 was$1.32 , compared to$0.19 in Q4 2021.
- Diluted Loss per Share from Continuing Operations in 2022 was
$3.81 , compared to a loss of$3.62 per Share in 2021. Diluted Loss per Share in Q4 2022 was$1.28 , compared to$0.19 per share in Q4 2021.
- Net loss from Discontinued Operations[3] in 2022 was
$166.4 million , compared to$17.9 million in 2021. Net Loss from Discontinued Operations in Q4 2022 was$23.8 million , compared to$4.1 million in Q4 2021.
- Basic and Diluted Loss per Share from Discontinued Operations in 2022 was
$23.2 , compared to a loss of$3.08 per Share in 2021. Basic and Diluted Loss per Share in Q4 2022 was$4.7 , compared to$0.19 in Q4 2021.
- Cash and Cash Equivalents as of December 31, 2022 were
$2.4 million , compared with$13.9 million in December 31, 2021.
- Total assets as of December 31, 2022 were
$60.7 million , compared to$287.4 million in December 31, 2021, a decrease of79% . The decrease is mainly attributed to a goodwill impairment of$107.8 million relating to Trichome acquisition and the deconsolidation of Trichome groups assets of$54.7 million .
- Liabilities as of December 31, 2022 were
$36.9 million , compared to$82.4 in December 31, 2021, a decrease of approximately55% .
Q4 & Full Year 2022 Business Highlights
- On March 14, 2022, pursuant to an agreement entered into on August 16, 2021, IMC Holdings Ltd. ("IMC Holdings"), a subsidiary of the Company, completed the acquisition of
51% of the issued and outstanding ordinary shares of Revoly Trading and Marketing Ltd. dba Vironna Pharm, a pharmacy licensed to dispense and sell medical cannabis and is one of the leading pharmacies serving patients in the Arab population in Israel.
- On March 14, 2022, pursuant to an agreement entered into on July 28, 2021, IMC Holdings completed the acquisition of
100% of the issued and outstanding shares of R.A. Yarok Pharm Ltd., a leading medical cannabis pharmacy located in central Israel, and Rosen High Way Ltd., a trade and distribution center providing medical cannabis storage, distribution services and logistics solutions for cannabis companies and pharmacies in Israel.
- On March 14, 2022, IMC Holdings acquired a medical cannabis storage and distribution license (trading house) from from Panaxia Pharmaceutical Industries Israel Ltd. and Panaxia Logistics Ltd., part of the Panaxia Labs Israel, Ltd. group of companies (collectively, "Panaxia"), as part of the Panaxia transaction entered into on May 1, 2021.
- On March 28, 2022, pursuant to an agreement entered into on December 1, 2021, IMC Holdings completed the acquisition of
51.3% of the outstanding ordinary shares of Oranim Plus Pharm Ltd, who holds99.5% of the rights in the partnership "Oranim Pharm", resulting in IMC Holdings owning51% of the rights in "Oranim Pharm", which is one of the largest pharmacies selling medical cannabis in Israel and the largest pharmacy selling medical cannabis in the Jerusalem area.
- In Q2 2022, the Company closed its cultivation facility in Sde Avraham, Israel to concentrate on leveraging its skilled sourcing team and strategic alliances with Canadian suppliers. In July 2022, Focus Medical received a license which allows it to continue to import cannabis products and supply medical cannabis to patients through licensed pharmacies despite the closure of the facility in Sde Avraham.
- During Q4, 2022, the Company announced that it closed a private placement, consisting of 599,999 common shares of the Company at a price of US
$5.00 per common share for aggregate proceeds of approximately US$3,000,000 .
- On November 7, 2022, the Company announced that it was commencing an exit of the Canadian cannabis market to focus its resources on pursuing growth opportunities in Israel, Germany and Europe. Trichome filed for and obtained creditor protection under the Canadian Companies' Creditors Arrangement Act ("CCAA"). The CCAA proceedings are solely in respect of Trichome. As such, the Company's other assets or subsidiaries, including those in Israel and Germany, are not parties to the CCAA proceedings. The sale and investment solicitation process conducted by the Ontario Superior Court of Justice did not result in any bids for the going-concern business of Trichome. As such, Trichome and the monitor appointed under the CCAA will proceed with the wind-down of the operations of Trichome and the liquidation of its remaining assets.
The Company's financial statements as of December 31, 2022 includes a note regarding the Company's ability to continue as a going concern. The Company's Q4 2022 financial results do not include any adjustments relating to the recoverability and classification of assets or liabilities that might be necessary should the Company be unable to continue as a going concern. For more information, please refer to the "Liquidity and Capital Resources" and "Risk Factors" sections in the Company's management's discussion and analysis for the fiscal year ended December 31, 2022.
The Company's audited consolidated financial statements for the fiscal year ended December 31, 2022 and related management's discussion and analysis, together with its Annual Report on Form 20-F, are available electronically under the Company's SEDAR profile at www.sedar.com and will be available on EDGAR at www.sec.gov/edgar.
Q4 & Full Year 2022 Conference Call
The Company will host a zoom web conference call today at 9:00 a.m. ET to discuss the results, followed by a question-and-answer session for the investment community. Investors are invited to register by clicking here. All relevant information will be sent upon registration.
If you are unable to join us live, a recording of the call will be available on our website at https://investors.imcannabis.com/ within 24 hours after the call.
About IM Cannabis Corp.
IMC (Nasdaq: IMCC) (CSE: IMCC) is an international cannabis company that provides premium cannabis products to medical patients in Israel and Germany, two of the largest medical cannabis markets. The Company has recently commenced exiting operations in Canada to pivot its focus and resources to achieve sustainable and profitable growth in its highest value markets, Israel and Germany. The Company leverages a transnational ecosystem powered by a unique data-driven approach and a globally sourced product supply chain. With an unwavering commitment to responsible growth and compliance with the strictest regulatory environments, the Company strives to amplify its commercial and brand power to become a global high-quality cannabis player.
The IMC ecosystem operates in Israel through its commercial relationship with Focus Medical Herbs Ltd. ("Focus Medical"), which imports and distributes cannabis to medical patients, leveraging years of proprietary data and patient insights. The Company also operates medical cannabis retail pharmacies, online platforms, distribution centers, and logistical hubs in Israel that enable the safe delivery and quality control of IMC products throughout the entire value chain. In Germany, the IMC ecosystem operates through Adjupharm GmbH, where it distributes cannabis to pharmacies for medical cannabis patients. Until recently, the Company also actively operated in Canada through Trichome Financial Corp. and its wholly-owned subsidiaries Trichome JWC Acquisition Corp. and MYM Nutraceuticals Inc., where it cultivated, processed, packaged, and sold premium and ultra-premium cannabis at its own facilities under the WAGNERS and Highland Grow brands for the adult-use market in Canada. The Company is exiting operations in Canada and considers these operations discontinued. For more information, please visit www.imcannabis.com.
Company Contact:
Oren Shuster, CEO
IM Cannabis Corp.
info@imcannabis.com
Forward-Looking Statements
This press release contains forward-looking information or forward-looking statements under applicable Canadian and U.S. securities laws (collectively, "forward-looking statements"). All information that addresses activities or developments that we expect to occur in the future are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect", "likely" and "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions. Forward-looking statements are based on the estimates and opinions of management on the date the statements are made. In the press release, such forward-looking statements include, but are not limited to, statements relating to the Company leaving the Canadian cannabis market to focus on Israel, Germany and Europe; achieving profitability and shareholder value; expectations related to demand, growth opportunities in Israel, Germany and Europe; demand and momentum in the Company's Israeli operations; the restructuring of Trichome under CCAA and the expected wind up of Trichome; statements regarding the Company's ongoing restructuring of its operations, including the reduction in its Israeli workforce and the strategic plans of the Company.
Forward-looking statements are based on assumptions that may prove to be incorrect, including but not limited to: the development and introduction of new products; continuing demand for medical and adult-use recreational cannabis in the markets in which the Company operates; the Company's ability to reach patients through both e-commerce and brick and mortar retail operations; the Company's ability to maintain and renew or obtain required licenses; the effectiveness of its products for medical cannabis patients and recreational consumers; and the Company's ability to market its brands and services successfully to its anticipated customers and medical cannabis patients.
The above lists of forward-looking statements and assumptions are not exhaustive. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated or implied by such forward-looking statements due to a number of factors and risks. These include: any failure of the Company to maintain "de facto" control over Focus Medical in accordance with IFRS 10; the failure of the Company to comply with applicable regulatory requirements in a highly regulated industry; unexpected changes in governmental policies and regulations in the jurisdictions in which the Company operates; the Company's ability to continue to meet the listing requirements of the Canadian Securities Exchange and the NASDAQ Capital Market; any unexpected failure to maintain in good standing or renew its licenses; the ability of the Company and Focus Medical (collectively, the "Group") to deliver on their sales commitments or growth objectives; the reliance of the Group on third-party supply agreements to provide sufficient quantities of medical cannabis to fulfil the Group's obligations; the Group's possible exposure to liability, the perceived level of risk related thereto, and the anticipated results of any litigation or other similar disputes or legal proceedings involving the Group; the impact of increasing competition; any lack of merger and acquisition opportunities; adverse market conditions; the inherent uncertainty of production quantities, qualities and cost estimates and the potential for unexpected costs and expenses; risks of product liability and other safety-related liability from the usage of the Group's cannabis products; supply chain constraints; reliance on key personnel; the risk of defaulting on existing debt and war, conflict and civil unrest in Eastern Europe and the Middle East.
Any forward-looking statement included in this press release is made as of the date of this press release and is based on the beliefs, estimates, expectations and opinions of management on the date such forward-looking information is made. The Company does not undertake any obligation to update forward-looking statements except as required by applicable securities laws. Investors should not place undue reliance on forward-looking statements. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
Non-IFRS Measures
This press release makes reference to "Gross Margin" and "Adjusted EBITDA", which are financial measures that are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. These measures are provided as complementary information to the Company's IFRS measures by providing further understanding of our results of operations from management's perspective. Accordingly, these measures should neither be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS.
For an explanation of how management defines Gross Margin and Adjusted EBITDA, see the Company's management's discussion and analysis for the period ended December 31, 2022, available under the Company's SEDAR profile at www.sedar.com on EDGAR at www.sec.gov/edgar.
We reconcile these non-IFRS financial measures to the most comparable IFRS measures as set out below.
For the year ended | For the three months | |||||||
2022 | 2021 | 2022 | 2021 | |||||
Operating Loss | $ (23,035) | |||||||
Add: Depreciation & Amortization | $ 2,815 | $ 2,125 | $ 873 | $ 1,022 | ||||
EBITDA (Non-IFRS) | $ (20,910) | $ (9,836) | ||||||
Add: IFRS Biological assets fair value adjustments, net (1) | $ 2,129 | $ 1,448 | $ 188 | $ (638) | ||||
Add: Share-based payments | $ 2,637 | $ 3,305 | $ 428 | $ (650) | ||||
Add: Costs related to the Nasdaq listing (2) | $ - | $ 1,261 | $ - | $ - | ||||
Add: Restructuring cost (3) | $ 4,383 | $ - | $ - | $ - | ||||
Add: Other non-recurring costs (4) | $ 7,336 | $ 570 | $ 7,336 | $ - | ||||
Adjusted EBITDA (Non-IFRS) | $ (11,491) | $ (14,326) | $ (1,884) | |||||
Year ended | Year ended | Three months | Three months | |
Net Revenue | ||||
Cost of sales | ||||
Gross profit before fair value adjustments | $ 8,595 | |||
Gross margin before fair value adjustments (Non-IFRS) | 21 % | 25 % | 19 % | 11 % |
[1] Continuing Operations are the ongoing activities of the Company, excluding the segments that are discontinued.
[2] Gross Margin and Adjusted EBITDA are non-IFRS financial measures with no standardized meaning under IFRS, and therefore they may not be comparable to similar measures presented by other issuers. The closest IFRS measure to Adjusted EBITDA is "operating loss". For further information and detailed reconciliations of non-IFRS financial measures to the most directly comparable IFRS measures, see "Non-IFRS Measures" in this press release.
[3] Discontinued Operations are Trichome Financial Corp. and its wholly-owned subsidiaries.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||||
Canadian Dollars in thousands | ||||||
December 31, | ||||||
2022 | 2021 | |||||
ASSETS | ||||||
CURRENT ASSETS: | ||||||
Cash and cash equivalents | $ 2,449 | $ 13,903 | ||||
Trade receivables | 8,684 | 16,711 | ||||
Advances to suppliers | 1,631 | 2,300 | ||||
Other accounts receivable | 3,323 | 14,482 | ||||
Loans receivable | - | 2,708 | ||||
Biological assets | - | 1,687 | ||||
Inventory | 16,585 | 29,391 | ||||
32,672 | 81,182 | |||||
NON-CURRENT ASSETS: | ||||||
Property, plant and equipment, net | 5,221 | 30,268 | ||||
Investments in affiliates | 2,410 | 2,429 | ||||
Advance payment for intangible assets of pharmacy | - | 3,129 | ||||
Derivative assets | - | 14 | ||||
Right-of-use assets, net | 1,929 | 18,162 | ||||
Deferred tax assets, net | 763 | 16 | ||||
Intangible assets, net | 7,910 | 30,885 | ||||
Goodwill | 9,771 | 121,303 | ||||
28,004 | 206,206 | |||||
Total assets | $ 60,676 | $ 287,388 | ||||
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||||
Canadian Dollars in thousands | ||||||
December 31, | ||||||
2022 | 2021 | |||||
LIABILITIES AND EQUITY | ||||||
CURRENT LIABILITIES: | ||||||
Trade payables | $ 15,312 | $ 13,989 | ||||
Bank loans and others | 9,246 | 9,502 | ||||
Other accounts payable and accrued expenses | 6,013 | 20,143 | ||||
Accrued purchase consideration liabilities | 2,434 | 6,039 | ||||
Current maturities of operating lease liabilities | 814 | 1,554 | ||||
33,819 | 51,227 | |||||
NON-CURRENT LIABILITIES: | ||||||
Warrants measured at fair value | 8 | 6,022 | ||||
Operating lease liabilities | 1,075 | 17,820 | ||||
Long-term loans | 399 | 392 | ||||
Employee benefit liabilities, net | 246 | 391 | ||||
Deferred tax liability, net | 1,332 | 6,591 | ||||
3,060 | 31,216 | |||||
Total liabilities | 36,879 | 82,443 | ||||
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY: | ||||||
Share capital and premium | 245,775 | 237,677 | ||||
Treasury Stock | (660) | (660) | ||||
Translation reserve | 1,283 | 2,614 | ||||
Reserve from share-based payment transactions | 15,167 | 12,348 | ||||
Accumulated deficit | (238,913) | (50,743) | ||||
Total equity attributable to shareholders of the Company | 22,652 | 201,236 | ||||
Non-controlling interests | 1,145 | 3,709 | ||||
Total equity | 23,797 | 204,945 | ||||
Total equity and liabilities | $ 60,676 | $ 287,388 | ||||
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS | ||||||||
AND OTHER COMPREHENSIVE INCOME | ||||||||
Canadian Dollars in thousands | ||||||||
Year ended December 31, | ||||||||
2022 | 2021 (*) | 2020 | ||||||
Revenues | $ 54,335 | $ 34,053 | $ 15,890 | |||||
Cost of revenues | 43,044 | 25,458 | 7,081 | |||||
Gross profit before fair value adjustments | 11,291 | 8,595 | 8,809 | |||||
Fair value adjustments: | ||||||||
Unrealized change in fair value of biological assets | (315) | 6,308 | 11,781 | |||||
Realized fair value adjustments on inventory sold in the year | (1,814) | (8,570) | (10,122) | |||||
Total fair value adjustments | (2,129) | (2,262) | 1,659 | |||||
Gross profit after fair value adjustments | 9,162 | 6,333 | 10,468 | |||||
General and administrative expenses | 21,459 | 17,221 | 11,549 | |||||
Selling and marketing expenses | 11,473 | 6,725 | 3,782 | |||||
Restructuring expenses | 4,383 | - | - | |||||
Share-based compensation | 2,637 | 5,422 | 3,382 | |||||
Total operating expenses | 39,952 | 29,368 | 18,713 | |||||
Operating loss | (30,790) | (23,035) | (8,245) | |||||
Finance income | 6,703 | 23,544 | 277 | |||||
Finance expenses | (1,972) | (673) | (20,504) | |||||
Finance income (expense), net | 4,731 | 22,871 | (20,227) | |||||
Loss before income taxes | (26,060) | (164) | (28,472) | |||||
Income tax expense (benefit) | (1,138) | 500 | 262 | |||||
Net loss from continuing operations | (24,922) | (664) | (28,734) | |||||
Net loss from discontinued operations, net of tax | (166,379) | (17,854) | - | |||||
Net loss | $ (191,301) | $ (18,518) | $ (28,734) | |||||
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS | |||||||||
AND OTHER COMPREHENSIVE INCOME | |||||||||
Canadian Dollars in thousands, except per share data | |||||||||
Year ended December 31, | |||||||||
2022 | 2021 (*) | 2020 | |||||||
Other comprehensive income that will not be reclassified to profit or loss in subsequent periods: | |||||||||
Remeasurement gain (loss) on defined benefit plans | 59 | 21 | (30) | ||||||
Exchange differences on translation to presentation currency | (1,238) | 858 | 1,144 | ||||||
Total other comprehensive income that will not be reclassified to profit or loss in subsequent periods | (1,179) | 879 | 1,114 | ||||||
Other comprehensive income that will be reclassified to profit or loss in subsequent periods: | |||||||||
Adjustments arising from translating financial statements of foreign operation | (246) | 530 | (124) | ||||||
Total other comprehensive income (loss) | (1,425) | 1,409 | 990 | ||||||
Total comprehensive loss | (192,726) | (17,109) | (27,744) | ||||||
Net loss attributable to: | |||||||||
Equity holders of the Company | (188,890) | (17,763) | (28,698) | ||||||
Non-controlling interests | (2,411) | (755) | (36) | ||||||
(191,301) | (18,518) | (28,734) | |||||||
Total comprehensive income (loss) attributable to: | |||||||||
Equity holders of the Company | (190,162) | (16,357) | (27,808) | ||||||
Non-controlling interests | (2,564) | (752) | 64 | ||||||
$ (192,726) | $ (17,109) | $ (27,744) | |||||||
Earnings (loss) per share attributable to equity holders of the Company from continuing operations: | |||||||||
Basic earnings (loss) per share (in CAD) | $ (3.13) | $ 0.02 | $ (1.9) | ||||||
Diluted loss per share (in CAD) | $ (3.81) | $ (3.62) | $ (1.9) | ||||||
Loss per share attributable to equity holders of the Company from discontinued operations: | |||||||||
Basic and diluted loss per share (in CAD) | $ (23.17) | $ (3.08) | $ - | ||||||
Loss per share attributable to equity holders of the Company from net loss: | |||||||||
Basic earnings (loss) per share (in CAD) | $ (26.30) | $ (3.06) | $ (1.9) | ||||||
Diluted loss per share (in CAD) | $ (26.98) | $ (6.7) | $ (1.9) | ||||||
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||||||||||||||
Canadian Dollars in thousands | ||||||||||||||||
Share capital and premium*) | Treasury Stock | Reserve from share-based payment transactions | Translation reserve | Accumulated deficit | Total | Non-controlling interests | Total equity | |||||||||
Balance as of January 1, 2020 | $ 25,947 | $ - | $ 2,677 | $ 309 | $ (4,273) | $ 24,660 | $ 1,449 | |||||||||
Net loss | - | - | - | - | (28,698) | (28,698) | (36) | (28,734) | ||||||||
Total other comprehensive income (loss) | - | - | - | 920 | (30) | 890 | 100 | 990 | ||||||||
Total comprehensive income (loss) | - | - | - | 920 | (28,728) | (27,808) | 64 | (27,744) | ||||||||
Exercise of warrants and compensation options | 10,251 | - | - | - | - | 10,251 | - | 10,251 | ||||||||
Exercise of options | 834 | - | (222) | - | - | 612 | - | 612 | ||||||||
Share-based compensation | - | - | 3,382 | - | - | 3,382 | - | 3,382 | ||||||||
Expired options | 8 | - | (8) | - | - | - | - | - | ||||||||
Balance as of January 1, 2021 | $ 37,040 | $ - | $ 5,829 | $ 1,229 | $ (33,001) | $ 11,097 | $ 1,513 | |||||||||
Net loss | - | - | - | - | (17,763) | (17,763) | (755) | (18,518) | ||||||||
Total other comprehensive income | - | - | - | 1,385 | 21 | 1,406 | 3 | 1,409 | ||||||||
Total comprehensive income (loss) | - | - | - | 1,385 | (17,742) | (16,357) | (752) | (17,109) | ||||||||
Issuance of common shares, net of issuance costs of | 195,259 | - | - | - | - | 195,259 | 2,948 | 198,207 | ||||||||
Purchase of treasury common shares | - | (660) | - | - | - | (660) | - | (660) | ||||||||
Exercise of warrants and compensation options | 4,293 | - | - | - | - | 4,293 | - | 4,293 | ||||||||
Exercise of options | 1,053 | - | (920) | - | - | 133 | - | 133 | ||||||||
Share-based compensation | - | - | 7,471 | - | - | 7,471 | - | 7,471 | ||||||||
Expired options | 32 | - | (32) | - | - | - | - | - | ||||||||
Balance as of December 31, 2021 | $ 237,677 | $ (660) | $ 12,348 | $ 2,614 | $ (50,743) | $ 201,236 | $ 3,709 | |||||||||
*) Including the effect of Share Consolidation (See note 18a). | ||||||||||||||||
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||||||||||||||
Canadian Dollars in thousands | ||||||||||||||||
Share capital and premium*) | Treasury Stock | Reserve from share-based payment transactions | Translation reserve | Accumulated deficit | Total | Non-controlling interests | Total equity | |||||||||
Balance as of January 1, 2022 | $ 237,677 | $ (660) | $ 12,348 | $ 2,614 | $ (50,743) | $ 3,709 | ||||||||||
Net loss | - | - | - | - | (188,890) | (188,890) | (2,411) | (191,301) | ||||||||
Total other comprehensive income (loss) | - | - | - | (1,331) | 59 | (1,272) | (153) | (1,425) | ||||||||
Total comprehensive loss | - | - | - | (1,331) | (188,831) | (190,162) | (2,564) | (192,726) | ||||||||
Issuance of treasury common shares |
- | 660 | - | - | - | 660 | - | 660 | ||||||||
Issuance of shares, net of issuance costs of | 6,818 | - | - | - | - | 6,818 | - | 6,818 | ||||||||
Exercise of options | 992 | - | (659) | - | - | 333 | - | 333 | ||||||||
Share-based compensation | - | - | 3,767 | - | - | 3,767 | - | 3,767 | ||||||||
Expired options | 289 | - | (289) | - | - | - | - | - | ||||||||
Balance as of December 31, 2022 | $ 245,776 | $ - | $ 15,167 | $ 1,283 | $ (239,574) | $ 22,652 | $ 1,145 | $ 23,797 | ||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
Canadian Dollars in thousands | ||||||
Year ended December 31, | ||||||
2022 | 2021 | 2020 | ||||
Cash provided from operating activities: | ||||||
Net loss | $ (191,301) | $ (18,518) | $ (28,734) | |||
Adjustments for non-cash items: | ||||||
Unrealized gain on changes in fair value of biological assets | (84) | (7,210) | (11,781) | |||
Fair value adjustment on sale of inventory | 4,342 | 8,796 | 10,122 | |||
Fair value adjustment on Warrants, Investments, and Accounts Receivable | (6,000) | (21,638) | 20,155 | |||
Depreciation of property, plant and equipment | 3,044 | 3,021 | 690 | |||
Amortization of intangible assets | 2,343 | 1,158 | 31 | |||
Depreciation of right-of-use assets | 1,944 | 1,550 | 209 | |||
Impairment of goodwill | 107,854 | 275 | - | |||
Impairment of property, plant and equipment | 2,277 | - | - | |||
Impairment of intangible assets | 7,199 | - | - | |||
Impairment of right-of-use assets | 1,914 | - | - | |||
Finance income, net | 6,532 | 1,262 | 72 | |||
Deferred tax payments (benefit), net | (3,004) | 278 | (66) | |||
Share-based payments | 3,767 | 7,471 | 3,382 | |||
Share based acquisition costs related to business combination | - | 807 | - | |||
Revaluation of other accounts receivable | 3,982 | - | - | |||
Restructuring expenses | 8,757 | - | - | |||
144,867 | (4,230) | 22,814 | ||||
Changes in non-cash working capital: | ||||||
Increase (decrease) in trade receivables, net | 6,058 | (6,602) | (3,534) | |||
Increase (decrease) in other accounts receivable and advances to suppliers | 3,622 | 845 | (1,029) | |||
Decrease in biological assets, net of fair value adjustments | 565 | 6,412 | 11,771 | |||
Increase (decrease) in inventory, net of fair value adjustments | 883 | (19,707) | (12,729) | |||
Increase in trade payables | 11,284 | 5,573 | 2,135 | |||
Changes in employee benefit liabilities, net | (63) | 28 | 59 | |||
Increase in other accounts payable and accrued expenses | 12,126 | 2,661 | 1,929 | |||
34,475 | (10,790) | (1,398) | ||||
Taxes paid | (681) | (834) | (601) | |||
Net cash used in operating activities | (12,640) | (34,372) | (7,919) | |||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
Canadian Dollars in thousands | ||||||
Year ended December 31, | ||||||
2022 | 2021 | 2020 | ||||
Cash flows from investing activities: | ||||||
Purchase of property, plant and equipment | $ (1,562) | $ (4,578) | $ (2,617) | |||
Proceeds from sales of property, plant and equipment | 210 | - | - | |||
Proceeds from loans receivable | 350 | 7,796 | - | |||
Purchase of intangible assets | - | (17) | (93) | |||
Acquisition of businesses, net of cash acquired | - | (12,536) | - | |||
Deconsolidation of subsidiary (see Note 24) | (406) | - | - | |||
Investments in financial assets | - | (13) | (1,347) | |||
Proceeds from sale of investment | - | 319 | - | |||
Proceeds from (investment in) restricted deposits | - | 17 | (18) | |||
Net cash used in investing activities | (1,408) | (9,012) | (4,075) | |||
Cash provided by financing activities: | ||||||
Proceeds from issuance of share capital, net of issuance costs | 3,756 | 28,131 | - | |||
Proceeds from issuance of warrants measured at fair value | - | 11,222 | - | |||
Proceeds from exercise of warrants | - | 3,682 | 6,378 | |||
Proceeds from exercise of options | 333 | 133 | 612 | |||
Repayment of lease liability | (1,656) | (633) | (182) | |||
Payment of lease liability interest | (1,429) | (1,347) | (68) | |||
Proceeds from loans | 9,636 | 7,804 | - | |||
Repayment of loans | (4,976) | - | - | |||
Interest paid | (902) | (261) | - | |||
Net cash provided by financing activities | 4,762 | 48,731 | 6,740 | |||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||
Canadian Dollars in thousands | ||||||||||||
Year ended December 31, | ||||||||||||
2022 | 2021 | 2020 | ||||||||||
Effect of foreign exchange on cash and cash equivalents | $ (2,168) | $ (329) | $ 213 | |||||||||
Increase (decrease) in cash and cash equivalents | (11,454) | 5,018 |
(5,041) | |||||||||
Cash and cash equivalents at beginning of year | 13,903 | 8,885 |
13,926 | |||||||||
Cash and cash equivalents at end of year | $ 2,449 | $ 13,903 | $ 8,885 | |||||||||
Supplemental disclosure of non-cash activities: | ||||||||||||
Right-of-use asset recognized with corresponding lease liability | $ 613 | $ 1,678 | $ 107 | |||||||||
Conversion of warrant and compensation options into common shares | $ - | $ 611 | $ - | |||||||||
Issuance of shares in payment of purchase consideration liability |
$ 3,061 |
$ - |
$ - | |||||||||
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SOURCE IM Cannabis Corp
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