• Record Q1 2023 gross revenues of $9.5M, increase of 315% from Q1 2022
• Record Q1 2023 cash provided by operations of $1.5M, compared to $104K in Q1 2022
• Q1 2023 gross profit of $1.7M, increase of 102% from Q1 2022

LANGLEY, BC / ACCESSWIRE / May 30, 2023 / Adastra Holdings Ltd. (CSE:XTRX) (FRA:D2EP) (“Adastra” or the “Company“), a leading cannabis processor and producer of two top Canadian concentrates brands, with a focus on product innovation and commercialization for adult-use and medical markets, is pleased to report financial results for the three months ended March 31, 2023.

“Our triple-digit revenue growth from Q1 2022 as compared to Q1 2023 is a testament to the robust market demand for our exceptional products and our strong presence across Canada,” said Michael Forbes, Chief Executive Officer. “Our ownership of both the legendary legacy brand, Phyto Extractions, and the dynamic in-house brand, Endgame Extracts, has solidified our position in the Canadian concentrate market with numerous top-selling products.”

“I am immensely proud of our team’s innovative mindset and unwavering dedication, which have been instrumental in our accomplishments. Their hard work and creativity have been the driving force behind our remarkable results,” added Forbes. “Together, we are poised to continue pushing boundaries and fueling future growth, all with the ultimate goal of creating long-term value for our customers, partners, and shareholders.”

Key Q1 2023 Financial Highlights

• Gross revenues of $9.5M in Q1 2023, compared to $2.3M in Q1 2022, representing an increase of 315%, demonstrating strong demand for Adastra’s cannabis concentrate brands and products.
• Gross revenues experienced a 39% increase from Q4 2022 to Q1 2023.
• Operating expenses as a percentage of gross revenues decreased from 74% in Q1 2022 to 20% in Q1 2023.
• Q1 2023 cash position increased to $1.9M from operations, an increase of $922K from Q4 2022.
• Inventory levels increased to $4.3M at March 31, 2023, due to the recent buyback of Phyto Extractions inventory. These elevated inventory levels are expected to translate to revenue in future periods.
• Operating expenses increased only 11% from $1.7M during Q1 2022 to $1.9M during Q1 2023 which reflects the Company’s ability to maintain consistent operation costs while experiencing triple digit revenue growth.

Key Q1 2023 Corporate and Business Highlights

• In-house brand, Endgame Extracts ranks 3^rd, 4^th & 5^th of the best-selling concentrates in British Columbia, according to Headset¹.
• In-house brand, Endgame Extracts ranks 2^nd, 3^rd, 4^th, & 5^th of the best-selling concentrates in Alberta, according to Headset¹.
• In Q1 2023, new SKUs for in-house brands were accepted for listing in: Ontario – 19; Alberta – 20; Nova Scotia – 1; and Newfoundland – 1.

“With another quarter of record gross revenues, we are more excited than ever with what our team is capable of,” said Lachlan McLeod, Chief Financial Officer. “During the quarter, we incurred higher costs to fuel the record gross revenues and we will continue to work on streamlining the growth as we drive Adastra to future profitability.”

Financial Statements & Management’s Discussion and Analysis

This news release should be read in conjunction with Adastra’s interim financial statements and corresponding MD&A for the three months ended March 31, 2023, which can be found on Adastra’s issuer profile on SEDAR at www.sedar.com.

¹ Source: Headset Data, May 30, 2023

About Adastra Holdings Ltd.

Adastra has become one of Canada’s leaders in the supply and manufacturing of ethnobotanical and cannabis products for lawful adult-use. It serves medical markets and engages in forward-looking therapeutic applications. With cannabis concentrate products sold through retailers at more than 1,600 locations across Canada, Adastra’s Phyto Extractions and Endgame Extracts brands are now well established with a solid distribution presence. As a Health Canada licensed facility, it specializes in extraction, distillation and manufacturing of a range of cannabis-derived products. Adastra partners with healthcare professionals and practitioners within the regulated environment to create products suitable for the medical cannabis market, with the ultimate aim of addressing the needs of patients. For more information, visit: www.adastraholdings.ca.

Contacts

Michael Forbes, CEO, Corporate Secretary & Director
(778) 715-5011
michael@adastraholdings.ca

Investor Relations
ir@adastraholdings.ca

Forward-Looking Information

This news release contains forward-looking information within the meaning of Canadian securities legislation concerning the business of the Company. Forward-looking information is based on certain key expectations and assumptions made by the management of the Company. Although the Company believes that the expectations and assumptions on which such forward looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because the Company can give no assurance that they will prove to be correct. Forward looking information in this news release includes statements regarding, but not limited to the expectation for future growth, the anticipation of creating long-term value for customers, partners and shareholders, the expectation that increased inventory levels will translate into revenue in future periods and the intention to work on streamlining growth as the Company drives toward future profitability. There are numerous risks and uncertainties that could cause actual results and the Company’s plans and objectives to differ materially from those expressed in the forward-looking information. Important factors that could cause actual results to differ materially from those expressed in the forward-looking information include: the availability of a qualified workforce; changes in regulations or licensing affecting the Company’s business; reduced demand for cannabis and cannabis related products; reductions in the Company’s retail space and store locations; changes in consumer brand preferences; and other factors beyond the control of the Company. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, the Company does not intend to update these forward-looking statements.

SOURCE: Adastra Holdings Ltd.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

CALGARY, AB, May 29, 2023 /PRNewswire/ – Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSXV: DB) (OTCQB: DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce its interim financial results for the three month period ending March 31, 2023.

“We’ve started the year off with another strong quarter that represents both significant year over year acceleration as well as sequential growth.” said Paul Wilson, CEO of Decibel. “Our New, Unique and Innovative products, assortments and formats continue to resonate with both new and existing customers. This provides ample momentum as we approach a number of material and additional catalysts this summer, when we expect to build market share and brand position in Canada, and in turn continue to leverage our business internationally”.

First Quarter Highlights

• Record National Market Share⁽¹⁾ of 6.7% in Q1 2023 which placed Decibel as the 3^rd largest licensed producer in Canada by market share.
• Record Net Revenue was $27.1 million in the first quarter of 2023, with sequential growth of 5% over the prior quarter, despite seasonal weakness, and year over year growth of 63%. Net revenue improvement was driven by continued growth in demand for derivative products, expanded operational capacity, and expanded distribution.
• Gross Margin Before Fair Value Adjustments was 49% in the first quarter of 2023, compared to 43% in the prior quarter and 35% in the first quarter of 2022. The increase year over year was the result of significant cost savings which began in the third quarter of 2022 from initiatives including operational efficiencies, automation equipment commissioned, and sourcing of more cost-effective components related to the manufacturing of cannabis products.
• Adjusted EBITDA⁽²⁾ of $6.8 million in the first quarter of 2023, with a sequential decline of 4% over the prior quarter and year over year growth of 175%. This marks Decibel’s eleventh quarter of consecutive quarterly positive adjusted EBITDA.
• Record Adjusted Net Income⁽²⁾ of $3.3 million in the first quarter of 2023, with sequential growth of 87% over the prior quarter and a year over year improvement of $5.0 million.
• Record Adjusted Earnings Per Share (“Adjusted EPS”)⁽³⁾: of $0.01 Adjusted EPS in the first quarter, with a sequential improvement of $0.01 over the prior quarter and a year over year improvement of $0.01.

Summary Highlights

Link to Decibel’s Investor Presentation

Decibel’s interim financial statements for the three month period ending March 31, 2023 (“Financial Statements”) and related Management’s Discussion & Analysis for three month periods ending March 31, 2023, are available under the Company’s profile at www.sedar.com.

As of March 31, 2023, Decibel was in compliance with all of its financial covenants under its credit facilities and expects to remain in compliance for the remainder of its twelve-month forecast period.

About Decibel

Decibel is uncompromising in the process and craftsmanship needed to deliver the highest quality cannabis products and retail experiences. Decibel has three operating production houses along with its wholly owned retail business, Prairie Records. The Qwest Estate in Creston, BC is a licensed and operating 26,000 square foot cultivation space which produces the widely championed, rare cultivar-focused brands Qwest and Qwest Reserve, which are sold in six provinces across Canada. Thunderchild Cultivation, is a licensed and operating 80,000 square foot indoor cultivation facility in Battleford, Saskatchewan. The Plant, Decibel’s extraction facility, in Calgary, Alberta, has 15,000 square feet of Health Canada licensed extraction and product development space. This production house will fuel the growth of our brands Qwest, Qwest Reserve, Blendcraft, and General Admission, into new and innovative product formats like concentrates, vapes, edibles and beyond.

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

Cautionary Statements

Non-GAAP Measures

This press release contains certain financial performance measures that are not recognized or defined under IFRS (termed “Non-GAAP Measures”). As a result, this data may not be comparable to data presented by other licensed producers and cannabis companies. For an explanation of these measures to related comparable financial information presented in the Financial Statements prepared in accordance with IFRS, refer to the discussion below. The Company believes that these Non-GAAP Measures are useful indicators of operating performance and are specifically used by management to assess the financial and operational performance of the Company. Accordingly, these Non-GAAP Measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Non-GAAP Financial Measures

Adjusted EBITDA is a non-GAAP financial measure that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets, change in fair value of biological assets realized through inventory sold, depreciation and amortization expense, share-based compensation, other income, finance costs, foreign exchange loss, non-cash production costs and severance payments. Non-cash production costs relate to amortization expense allocations included in production costs. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.

Adjusted Net Income is a non-GAAP financial measure that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold. Adjusted EPS is a non-GAAP financial measure that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold, divided by the weighted average common shares outstanding. This non-GAAP financial measures should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.

Supplementary Financial Measures

Retail Sales is a supplementary financial measure that is intended to provide a more accurate depiction of the revenue earned by the Company’s retail operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is removed from Retail Revenue as presented in the Company’s Financial Statements.

Gross Sales of Flower is a supplementary financial measure intended to provide a more accurate depiction of gross revenue earned by the Company’s wholesale flower operations. Inventory transferred directly from the Company’s wholesale flower operations to the Company’s retail operations is added to Gross Wholesale Revenue of Flower as found in the Company’s Financial Statements to arrive at Gross Sales of Flower.

Net Sales of Flower is a supplementary financial measure intended to provide a more accurate depiction of net revenue earned by the Company’s wholesale flower operations. Excise taxes associated with flower sales are subtracted from Gross Sales of Flower to arrive at Net Sales of Flower.

Gross Sales of Extracts is a supplementary financial measure intended to provide a more accurate depiction of gross revenue earned by the Company’s wholesale extracts operations. Inventory transferred directly from the Company’s wholesale extracts operations to the Company’s retail operations is added to Gross Wholesale Revenue of Extracts as found in the Company’s Financial Statements to arrive at Gross Sales of Extracts.

Net Sales of Extracts is a supplementary financial measure intended to provide a more accurate depiction of net revenue earned by the Company’s wholesale extracts operations. Excise taxes associated with extracts sales are subtracted from Gross Sales of Extracts to arrive at Net Sales of Extracts.

Forward Looking Information

This news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements.

In this news release, forward-looking statements relate to, among other things: that the Company has strong momentum heading into 2023; expectations that demand for Decibel’s products will grow; the Company’s ability to meet consumer demand; Decibel’s expectations that it will build its position in Canada and turn leverage into international opportunities; anticipated growth in Decibel’s net revenue, growth in demand for Decibel’s products, and improvements made to Decibel’s operational capacity in the first quarter of 2023; anticipated future volatility in gross margin related to price competition; Decibel’s targeted gross margin; Decibel’s expectations that it will remain in compliance with its financial covenants for the remainder of its twelve-month forecast period; and the Company’s ability to grow Qwest, Qwest Reserve and Blendcraft brands into new and innovative product formats, variations and its other business plans and expectations. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, the Company assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.

Forward-looking statements and FOFI (as defined herein) are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: risks relating to delays, regulatory changes and impacts, capital requirements, construction impacts, the ability to obtain and maintain licences to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licences (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; timing and completion of construction and expansion of the Company’s production facilities and retail locations; the risk that the Company may not be able to meet consumer demand; the risk that the Company may not improve its operational capacity when anticipated, or at all; the risk that Decibel may not remain in compliance with its financial covenants for the remainder of its twelve-month forecast period; and the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable.

With respect to forward-looking statements and FOFI contained in this press release, Decibel has made assumptions regarding, but not limited to: growth of the brand and recognition in Canada will lead to growth internationally; demand for Decibel‘s products; Decibel’s ability to realize operational efficiencies and effect certain cost saving measures (including in the impact thereof); Decibel’s ability to enter new markets and industry verticals; Decibel’s ability to attract, develop and retain key personnel; Decibel’s ability to raise additional capital and to execute on its expansion plans; the timelines for new product launches, Decibel’s ability to continue investing in infrastructure and implement scalable controls, systems and processes to support its growth; the impact of competition; the changes and trends in Decibel’s industry or the global economy; the Company’s ability to generate sufficient cash flow from operations and obtain financing, if needed, on acceptable terms or at all; the general economic, financial market, regulatory and political conditions in which the Company operates; the ability of the Company to ship its products and maintain supply chain stability; consumer interest in the Company’s products; anticipated and unanticipated costs; government regulation of the Company’s activities and products; the timely receipt of any required regulatory approvals; the Company’s ability to conduct operations in a safe, efficient and effective manner; the Company’s construction plans and timeframe for completion of such plans; and the changes in laws, rules, regulations, and global standards.

Any financial outlook or future oriented financial information (in each case “FOFI”) contained in this news release regarding prospective financial position, including, but not limited to: anticipated future volatility in gross margin; Decibel‘s targeted gross margin; and Decibel’s expectations that it will remain in compliance with its financial covenants for the remainder of its twelve-month forecast period, is based on reasonable assumptions about future events, including those described above, based on an assessment by management of the relevant information that is currently available. The actual results will likely vary from the amounts set forth herein and such variations may be material.

Readers are cautioned that the foregoing list of assumptions and risk factors is not exhaustive. The forward-looking statements and FOFI contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements and FOFI included in this news release are made as of the date hereof and Decibel does not undertake any obligation to publicly update such forward-looking statements and FOFI to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

Market, Independent Third Party and Industry Data

Certain market, independent third party and industry data contained in this news release is based upon information from government or other independent industry publications and reports or based on estimates derived from such publications and reports. Government and industry publications and reports generally indicate that they have obtained their information from sources believed to be reliable, but Decibel has not conducted its own independent verification of such information. This news release also includes certain data derived from independent third parties. While Decibel believes this data to be reliable, market and industry data is subject to variations and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey. Decibel has not independently verified any of the data from independent third party sources referred to in this news release or ascertained the underlying assumptions relied upon by such sources.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

Achieved Ninth Consecutive Quarter of Positive Adjusted EBITDA

Received Shareholder Approval for Strategic Arrangement with Canopy and Canopy USA

Gained Access to Additional Funding Through Amendments to Credit Facility

NEW YORK, May 22, 2023 (GLOBE NEWSWIRE) — Acreage Holdings, Inc. (“Acreage” or the “Company”) (CSE: ACRG.A.U, ACRG.B.U) (OTCQX: ACRHF, ACRDF), a vertically integrated, multi-state operator of cannabis cultivation and retailing facilities in the U.S., today reported its financial results for the first quarter ended March 31, 2023 (“Q1 2023”).

First Quarter 2023 Financial Highlights

• Consolidated revenue of $56.0 million for Q1 2023.
• Gross margin was 48% for Q1 2023, an increase from 35% in the fourth quarter of 2022 (“Q4 2022”). Excluding the impact of non-cash inventory adjustments, gross margin for Q1 2023 was 51%.
• Adjusted EBITDA* was $10.6 million and Adjusted EBITDA* as a percentage of consolidated revenue was 19% for Q1 2023.

First Quarter and Recent Operational Highlights

• Received the required approval of the holders of Class D subordinate voting shares of Acreage (the “Floating Shareholders”), at a special meeting of Floating Shareholders held on March 15, 2023, in connection with the Company’s previously announced arrangement agreement dated October 24, 2022, as amended on March 17, 2023 (the “Floating Share Arrangement Agreement”) with Canopy Growth Corporation (“Canopy”) and Canopy USA, LLC (“Canopy USA”). Additionally, the Company obtained a final order from the Supreme Court of British Columbia on March 20, 2023, approving the Floating Share Arrangement Agreement under section 288 of the Business Corporations Act (British Columbia). Upon the satisfaction or waiver of all other conditions set out in the Floating Share Arrangement Agreement, which the parties continue to work towards, the parties will complete the ‎Floating Share Arrangement.
• Launched adult-use retail operations in Connecticut, among an inaugural group of operators permitted to begin adult-use sales in the state. Sales initially commenced at The Botanist store in Montville followed later by The Botanist Danbury location.
• Secured approval to relocate the Acreage’s existing Atlantic City medical dispensary to Pennsauken, New Jersey, along with the approval of the Company’s annual renewal of its license in the state. The Company anticipates commencing adult-use sales at the new Pennsauken location before the end of 2023.
• Introduced new line of dose-able fast-acting gummies in Illinois, Maine, Massachusetts, and Ohio under the flagship The Botanist brand.

Management Commentary

“Our focus on our core footprint while upholding strict cost controls has enabled us to maintain strong margins and continue to deliver positive Adjusted EBITDA despite continued volatility within the market,” said Peter Caldini, CEO of Acreage. “Over the first quarter, we were thrilled to have expanded our addressable market in Connecticut with the launch of adult-use sales at our thriving The Botanist Montville location, and just most recently in the second quarter, began serving adult-use consumers at our Danbury store. Additionally, continuing our commitment to diversifying our product portfolio, we debuted our innovative fast-acting gummies to consumers in Illinois, Maine, Massachusetts, and Ohio under our flagship brand The Botanist.”

Mr. Caldini continued, “Notably, during the quarter, we received shareholder approval for our strategic arrangement with Canopy and Canopy USA, bringing us one step closer to satisfying what is required to close the transaction. We have experienced numerous transformative achievements to bring Acreage to where it is today, and we could not be more excited for its expected bright future under Canopy USA. As we work to complete our arrangement with Canopy and Canopy USA, we will continue to focus on driving our business forward with a priority on managing cash flows in a volatile trading environment.”

Q1 2023 Financial Summary
(in thousands)

Total revenue for Q1 2023 was $56.0 million compared to $56.9 million in the first quarter of 2022 (“Q1 2022”) and $57.5 million in Q4 2022. The year-over-year and sequential decreases were primarily due to continued industry headwinds and decreased pricing as a result of competitive pressures across various markets. Additionally, the year-over-year decrease was also due to the divestiture of the Company’s operations in Oregon and was somewhat offset by the acquisition of a Maine dispensary in 2022. After adjusting for acquisitions and divestitures, revenue for Q1 2023 was relatively consistent with Q1 2022.

Total gross profit for Q1 2023 was $26.6 million, compared to $29.5 million in Q1 2022. Total gross margin was 48% in Q1 2023 compared to 52% in Q1 2022. Margin was impacted by cost increases due to inflation as well as price compression during the quarter. Additionally, cost of goods sold for Q1 2023 included $2.3 million of non-cash inventory adjustments as a result of excess inventory in select markets and carrying values of inventory exceeding net realizable value. Excluding these non-cash inventory adjustments, gross margin for Q1 2023 was 51%.

Total operating expenses for Q1 2023 were $25.4 million, compared to $32.2 million in Q1 2022. Operating expenses in the current quarter included a one-time bad debt charge of $1.3 million and a reversal of prior period bonus accruals of $2.5 million. Operating expenses in Q1 2022 included impairment charges and write-downs of assets held for sale that were not incurred in Q1 2023. Additionally, total operating expense for Q1 2023 benefitted from reduced equity-based compensation expenses and depreciation and amortization when compared to Q1 2022.

Adjusted EBITDA* for Q1 2023 was $10.6 million compared to Adjusted EBITDA* of $8.6 million in Q1 2022 and Adjusted EBITDA* of $7.0 million in Q4 2022.

Net loss attributable to Acreage for Q1 2023 was $(14.6) million, compared to $(12.7) million in Q1 2022.

Amendment to Credit Facility

Subsequent to quarter end, on April 28, 2023, Acreage further amended its existing credit facility (the “Credit Facility”) such that $15.0 million was available for immediate draw, but such funds would be maintained in a segregated account until dispersed and be restricted for use to only eligible capital expenditures. Additionally, the Company has agreed to limit the total amounts outstanding under the Credit Facility to $140.0 million and to, at all times subsequent to April 28, 2023, maintain collateral (as defined in the Credit Facility) equal to or greater than the outstanding amount under the Credit Facility.

Balance Sheet and Liquidity

Acreage ended Q1 2023 with $14.3 million in cash and cash equivalents. As of March 31, 2023, $125.0 million was drawn under the Amended Credit Facility, with a further $15.0 million of long-term debt available from its committed debt facilities, but such funds are restricted for use to only eligible capital expenditures. Additionally, in April 2023, the Company sold, with recourse, the rights to receive certain Employee Retention Tax Credits with an aggregate receivable value of $14.3 million for total proceeds of $12.1 million.

About Acreage Holdings, Inc.

Acreage is a multi-state operator of cannabis ‎cultivation and retailing facilities in the U.S., including the Company’s national retail store ‎brand, The Botanist. With its principal address in New York City, Acreage’s wide range of national and regionally available cannabis products include the award-winning brands The Botanist and Superflux, the Tweed brand, the Prime medical brand in Pennsylvania, the Innocent brand in Illinois and others. Since its founding in 2011, Acreage has focused on building and scaling operations to create a seamless, consumer-focused, branded experience. Learn more at www.acreageholdings.com and follow us on Twitter, LinkedIn, Instagram, and Facebook.

Forward Looking Statements

This news release and each of the documents referred to herein contains “forward-looking information” and ‎‎“forward-looking statements” within the meaning of applicable Canadian and United States securities legislation, ‎respectively. All statements, other than statements of historical fact, included herein are forward-looking ‎information. ‎Often, but not always, forward-looking statements and information can be identified by the use of words such as ‎‎“plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, ‎or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, ‎‎‎“would”, “might” or “will” be taken, occur or be achieved. ‎

Forward-looking statements or information involve known and unknown risks, uncertainties, and other ‎factors which may cause the actual results, performance or achievements of Acreage or its ‎subsidiaries to be materially different from any future results, performance or achievements expressed or ‎implied by the forward-looking statements or information contained in this news release.

Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information, including, but not limited to: the occurrence of changes in U.S. federal Laws regarding the cultivation, distribution or possession of marijuana; ‎the ability of the parties to receive, in a timely manner and on satisfactory terms, the necessary regulatory, court ‎and Floating Shareholder approvals; the ability of the parties to satisfy, in a timely manner, the other conditions to the completion of the Floating Share ‎Arrangement Agreement; the ability of Canopy, Canopy USA and Acreage to satisfy, in a timely manner, the closing conditions to the Floating Share Arrangement; risks relating to the value and liquidity of the Floating Shares and the common shares of Canopy; Canopy maintaining compliance with the Nasdaq Global Stock Market (the “Nasdaq”) and Toronto Stock Exchange listing requirements; the rights of the Floating ‎Shareholders may differ materially from those of shareholders in Canopy; expectations regarding future investment, growth and ‎expansion of Acreage’s operations; the possibility of adverse U.S. or Canadian tax consequences upon completion of the Floating Share Arrangement; if Canopy USA acquires the Fixed Shares pursuant to the Existing Arrangement Agreement without structural amendments to Canopy’s interest in Canopy ‎USA, the listing of the Canopy Shares on the Nasdaq may be jeopardized; the risk of a change of ‎control of either Canopy or Canopy USA; restrictions on Acreage’s ability to pursue certain business ‎opportunities and other restrictions on Acreage’s business; the impact of material non-recurring expenses in ‎connection with the Floating Share Arrangement on Acreage’s future results of operations, cash flows and ‎financial condition; the possibility of securities class action or derivatives lawsuits; in the event that the Floating ‎Share Arrangement is not completed, but the acquisition by Canopy of the Fixed Shares (the “Acquisition”) is completed pursuant to Existing Arrangement Agreement and Canopy becomes the majority ‎shareholder in Acreage, the likelihood that the Floating Shareholders will have little or no influence on the conduct ‎of Acreage’s business and affairs; risk of situations in which the interests of Canopy USA and the interests of ‎Acreage or shareholders of Canopy may differ;‎ Acreage’s compliance with Acreage’s business plan for the fiscal years ending December 31, 2020 through December 31, 2029 pursuant to the Existing Arrangement Agreement; in the event that the Floating Share Arrangement is ‎completed, the likelihood of Canopy completing the Acquisition in accordance with the Existing Arrangement Agreement; ‎risks relating to certain directors and executive officers of Acreage having interests in the transactions ‎contemplated by the Floating Share Arrangement Agreement and the connected transactions that are different ‎from those of the Floating Shareholders; risks relating to the possibility that holders of more than 5% of the ‎Floating Shares may exercise dissent rights; other expectations and assumptions concerning the transactions ‎contemplated between Canopy, Canopy USA and Acreage; the available funds of Acreage and the anticipated ‎use of such funds; the availability of financing opportunities for Acreage and Canopy USA and the risks ‎associated with the completion thereof; regulatory and licensing risks; the ability of Canopy, Canopy USA and ‎Acreage to leverage each other’s respective capabilities and resources; changes in general economic, business ‎and political conditions, including changes in the financial and stock markets; risks relating to infectious diseases, ‎including the impacts of the COVID-19; legal and regulatory risks inherent in the cannabis industry, including the ‎global regulatory landscape and enforcement related to cannabis, political risks and risks relating to regulatory ‎change; risks relating to anti-money laundering laws; compliance with extensive government regulation and the ‎interpretation of various laws regulations and policies; public opinion and perception of the cannabis industry‎; and such other risks disclosed in the Circular, the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, dated May 1, 2023 and the Company’s other public filings, in each case filed with the SEC on the EDGAR website at www.sec.gov and with Canadian securities regulators and available under Acreage’s profile on SEDAR at www.sedar.com. Although Acreage has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended.

Although Acreage believes that the assumptions and factors used in preparing the forward-looking information or forward-looking statements in this news release are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed time frames or at all. The forward-looking information and forward-looking statements included in this news release are made as of the date of this news release and Acreage does not undertake any obligation to publicly update such forward-looking information or forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities laws.

Neither the Canadian Securities Exchange nor its Regulation Service Provider, nor any securities regulatory authority in Canada, the United States or any other jurisdiction, has reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.‎

For more information, contact:

Steve Goertz
Chief Financial Officer
investors@acreageholdings.com

Courtney Van Alstyne
MATTIO Communications
acreage@mattio.com

*NON-GAAP MEASURES, RECONCILIATION AND DISCUSSION (UNAUDITED)

This release includes Adjusted EBITDA, which is a non-GAAP performance measure that we use to supplement our results presented in accordance with U.S. GAAP. The Company uses Adjusted EBITDA to evaluate its actual operating performance and for planning and forecasting future periods. The Company believes that 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 our results with those of other companies and allow investors to review performance in the same way as our management. Since these measures are not calculated in accordance with U.S. GAAP, they should not be considered in isolation of, or as a substitute for, net loss or our other reported results of operations as reported under U.S. GAAP as indicators of our performance, and they may not be comparable to similarly named measures from other companies.

The Company defines Adjusted EBITDA as net income before interest, income taxes and, depreciation and amortization and excluding the following: (i) income from investments, net (the majority of the Company’s investment income relates to remeasurement to net asset value of previously-held interests in connection with our roll-up of affiliates, and the Company expects income from investments to be a non-recurring item as its legacy investment holdings diminish), (ii) equity-based compensation expense, (iii) non-cash impairment losses, (iv) transaction costs, (v) non-cash inventory adjustments and (vi) other non-recurring expenses (other expenses and income not expected to recur).

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

Synergy targets related to the Valens acquisition increased  to more than $30 million through 2024

CALGARY, AB, May 15, 2023 /PRNewswire/ – SNDL Inc. (NASDAQ: SNDL) (“SNDL” or the “Company“) reported its financial and operational results for the first quarter ended March 31, 2023. All financial information in this press release is reported in millions of Canadian dollars unless otherwise indicated. The results for the first quarter of 2023 include the operating results of The Valens Company Inc. (“Valens“) subsequent to the acquisition on January 17, 2023, and the results for the first quarter of 2022 include one day of Alcanna Inc. (“Alcanna“) operations subsequent to the acquisition closing on March 31, 2022.

SNDL has also posted a supplemental investor presentation on its website, which can be found at https://sndl.com.

FIRST QUARTER 2023 FINANCIAL AND OPERATIONAL HIGHLIGHTS

• Net revenue for the first quarter of 2023 of $202.5 million, compared to $240.4 million in the fourth quarter of 2022, and $17.6 million in the first quarter of 2022, representing a 1,050% increase year-over-year. The increase over the comparative quarter in the prior year is due to the acquisitions of Alcanna, Valens and Zenabis. The decrease in revenue in the first quarter of 2023, as compared to the fourth quarter of 2022, can be attributed to seasonality in the Liquor Retail segment, as the fourth quarter is traditionally the strongest and the first quarter is typically the weakest. This was partially offset by an increase in revenue from the Cannabis Operations segment due to the partial quarter contribution of Valens in 2023.
• Net loss of $36.1 million for the first quarter of 2023, compared to a $161.6 million net loss in the fourth quarter of 2022, and a $38.0 million net loss in the first quarter of 2022. The loss for the first quarter was impacted by the seasonal downturn in Liquor Retail sales and inventory and asset impairments of $10 million.
• Adjusted EBITDA of $7.4 million for the first quarter of 2023, compared to a loss of $7.5 million in the fourth quarter of 2022, and a loss of $0.7 million from the first quarter of 2022.
• Gross margin was $32.5 million in the first quarter of 2023, compared to $43.6 million in the fourth quarter of 2022 and up 856% from the first quarter of 2022. Seasonality of liquor sales impacted gross margin for the first quarter of 2023 compared to the prior sequential quarter.
• Closed the acquisition of Valens in January of 2023. The combined entities create a low-cost vertically integrated Canadian company with the capability of potentially generating over a billion dollars annually in pro forma revenue. Through the combination of a diverse portfolio of brands, a 197 store multi-banner cannabis retail network, low-cost biomass sourcing, premium indoor cultivation and low-cost manufacturing facilities, SNDL is one of the largest adult-use cannabis manufacturers and retailers in Canada.
• Since the close of the Valens acquisition, SNDL has achieved more than $13 million in annual cost savings and has identified $5 million in additional annual cost savings to be achieved in 2023, exceeding management’s original $10 million total target. By 2024, run-rate synergies are expected to exceed $30 million annually, and proceeds from asset sales are expected to total $9 million.
• On May 5, 2023, SNDL announced that the proposed strategic partnership (the “Nova Restructuring“) with its 63% owned subsidiary Nova Cannabis Inc. (“Nova“) was approved by Nova’s shareholders. The Nova Restructuring is designed to create a well-capitalized cannabis retail platform through a vertical integration model leveraging SNDL’s upstream and midstream capabilities. The Nova Restructuring is expected to close before the end of June 2023.
• SNDL currently has six credit exposures in the SunStream portfolio, including two under active negotiations regarding potential restructuring.
• $793 million of unrestricted cash, marketable securities and long-term investments, and no outstanding debt at March 31, 2023, resulting in a net book value per share of $5.26; and $189.8 million of unrestricted cash at May 12, 2023. SNDL has not raised cash through share offerings since June 2021.

“We are pleased to report progress towards key milestones in all of our operative segments against the backdrop of expected seasonally moderate sales in our retail networks,” said Zach George, Chief Executive Officer of SNDL. “The integration of Valens is proceeding with pace, and we are actively identifying new revenue streams and cost reduction opportunities. The first quarter was impacted by a number of one-time items including $13.5 million to replenish liquor inventory following the seasonal holiday draw in the fourth quarter of 2022, $2.7 million in severance and restructuring costs, and $17.5 million to stabilize Valens and bring overdue accounts payable up to date. We expect additional restructuring charges to impact the second quarter and the results of our team’s hard work to become clear in late 2023. We are focused on improving all aspects of our business with the objective of generating strong free cash flow. The relocation of all cannabis processing activities to our Kelowna complex will drive improved capacity utilization, and we are aggressively reducing our exposure to higher-cost cultivation as we seek low-cost producer status in all relevant product categories. In our retail segments, we are carving a path to higher margins and are excited about the recent launch of our data service programs and the potential for improved consumer engagement through new e-commerce and loyalty capabilities. We look forward to updating investors on our intended dividend of Nova shares, and events related to our SunStream portfolio in the coming weeks. 2023 is shaping up to be another transformational year for our company.”

FIRST QUARTER 2023 KEY FINANCIAL METRICS

FIRST QUARTER 2023 RESULTS

SNDL’s business is operated and reported in four segments: Liquor Retail, Cannabis Retail, Cannabis Operations and Investments.

Liquor Retail

SNDL is Canada’s largest private sector liquor retailer, operating 170 locations, predominantly in Alberta, under its three retail banners: “Wine and Beyond”, “Liquor Depot” and “Ace Liquor”.

• Gross revenue for Liquor Retail sales for the three banners combined was $115.9 million for the first quarter of 2023, a decrease of 27% compared to the fourth quarter of 2022. The first quarter of 2022 had results from only one day subsequent to the Alcanna acquisition.
• Gross margin in the Liquor Retail segment was $26.3 million, or 23% of sales in the first quarter of 2023, compared to $36.9 million, or 23% of sales, in the fourth quarter of 2022. Through strategic planning and effective execution, the Company actively managed its margin during the first quarter by strongly emphasizing its preferred label program. As a result, preferred label sales make up 10% of total sales in the first quarter of 2023. Preferred label sales were $11.2 million in the first quarter of 2023, compared to $14.0 million in the fourth quarter of 2022. Preferred label margin continues to be incrementally higher than the Company’s baseline margin, and the current preferred label margin is $3.2 million, or 29% of sales. The Company is seeing the continued benefits of this strategy subsequent to quarter end, with the margin on all products reaching 24% in April of 2023.
• SNDL’s liquor banners’ market share in Alberta was approximately 18% in the first quarter of 2023, with Wine and Beyond representing approximately 3% from only 11 stores in the province, showcasing the continued success of the banner. Sales at the Wine and Beyond in Kelowna, British Columbia continue to increase year-over-year, further validating the banner’s expansion strategy into new markets.
• SNDL successfully obtained two liquor retail licenses in Regina and Saskatoon through the Saskatchewan Liquor and Gaming Authority auction. The Company will leverage these licenses to further expand its premium liquor banner, Wine and Beyond, into the final stage of the liquor retail transition to the private sector in Saskatchewan.
• As of May 12, 2023, the Ace Liquor store count is 138, the Liquor Depot store count is 20, and the Wine and Beyond store count is 12.

Cannabis Retail

With its ownership interest in Nova, SNDL is Canada’s largest private sector cannabis retailer, operating 197 locations under its four retail banners: Value Buds, Spiritleaf, Superette and Firesale Cannabis. SNDL’s Cannabis Retail strategy is based on several factors, including the quality of its store locations, the range of products it offers, and the unique experiences it provides customers. Using data and insights from a large volume of monthly transactions enables SNDL to leverage technology and analytics to inform and improve its retail strategy.

• Gross revenue from the Cannabis Retail segment for the first quarter of 2023 was $67.4 million, compared to $68.4 million in the fourth quarter of 2022, showing a modest seasonal dip, and up from $7.5 million in the first quarter of 2022. The Nova acquisition and Value Buds sales were the material driver of the increase relative to the first quarter of 2022, with $60.2 million of revenue during the first quarter of 2023.
• Gross margin of $15.8 million, or 23% of sales, consistent with the fourth quarter of 2022 gross margin. The increase in gross margin compared to the first quarter of 2022 was primarily due to the acquisition of Nova and the addition of new Value Buds locations during those 12 months, combined with a more aggressive pricing strategy.
• In the first quarter of 2023, SNDL took proactive steps to optimize its proprietary data licensing program for the Cannabis Retail segment, aiming to create mutually beneficial results for its retail operations and licensed producer partners. The Company is optimistic that the optimized data licensing program will support the growth of the segment and create additional margin accretive opportunities. By leveraging the volume of Nova’s retail locations and the Company’s access to high-quality analytics, it expects to deliver successful outcomes for its partners and drive top-line growth.
• In the first quarter of 2023, Value Buds, Spiritleaf, and Superette’s combined market share represents approximately 9.6% in the privatized provincial markets, solidifying SNDL’s position as a leading national multi-banner cannabis retail operator in an increasingly competitive market.
• The Company partnered with Nova for Value Buds’ private label products, and sales of Value Buds products represented approximately 8.1% of total 28-gram sales and 36.3% of 14-gram sales in Alberta Value Buds stores for the period ended March 31, 2023. Private label margins are approximately 5% higher than margins on comparable competitor products.
• On May 5, 2023, SNDL’s proposed strategic partnership with Nova was approved by Nova shareholders to create a well-capitalized cannabis retail platform through a vertical integration model leveraging SNDL’s upstream and midstream capabilities.
• In February 2023, SNDL announced the acquisition of five Superette stores in Ontario.
• The Company entered into an agreement with Lightbox Enterprises Ltd. (“Lightbox”) to acquire four cannabis retail stores operating under the Dutch Love Cannabis banner (“Dutch Love”). The transaction is anticipated to close by the end of June 2023.
• As of May 12, 2023, the Spiritleaf store count is 99 (22 corporate stores and 77 franchise stores), the Superette store count is five corporate stores, the Firesale store count is two corporate stores, and the Value Buds store count is 92 corporate stores.

Cannabis Operations

SNDL has a diverse brand portfolio from value to premium, emphasizing premium inhalable formats and a full suite of 2.0 products. With enhanced procurement capabilities, premium cultivation facilities and the newly acquired Kelowna and Bolton manufacturing facilities, the Cannabis Operations segment is a key enabler of SNDL’s vertical integration strategy.

• Gross revenue from the Cannabis Operations segment for the first quarter of 2023 was $29.6 million, a 58% increase compared to the fourth quarter of 2022 and a 162% increase compared to the first quarter of 2022.
• Gross Margin was negative $9.5 million including a $9.2 million inventory impairment provision, compared to negative $9.0 million in the fourth quarter of 2022 and negative $0.2 million in the first quarter of 2022. The current quarter’s inventory impairment is a direct consequence of the ongoing refocusing and reorganization of the segment with the Valens expansion.
• Following the Valens acquisition, SNDL announced changes to its operations through a rightsizing of cannabis cultivation in Olds, Alberta, to focus the facility on premium products and brands and to better address market saturation, oversupply and efficiency. The Company’s ongoing focus on high-quality cannabis cultivation operations and its low-cost biomass procurement capabilities enhance SNDL’s ability to offer a wide range of customized, innovative products to meet customer demand and current market conditions.
• Effective May 1, SNDL has successfully transitioned all midstream production operations to the Company’s facility in Kelowna, including processing, labelling and excising activities. By reducing reliance on high-cost cannabis production and centralizing operations, the Company expects to increase efficiency and manage cash flow more effectively.
• As part of SNDL’s commitment to effectively address market demand, the Company is in the process of rationalizing its SKU portfolio. By focusing on high-margin products and continuing to drive innovation, the Company expects to see better margins for the Cannabis Operations segment in the upcoming quarters. This approach is designed to allow the Company to optimize its resources and achieve its long-term goals while maintaining a competitive edge in the market.
• In the first quarter of 2023, SNDL has realized an increase in its business-to-business (“B2B“) revenue and has established partnerships with most of the major Canadian licensed producers. SNDL is actively exploring opportunities for international export business and is committed to identifying new SKUs to meet the unique demands of its global partners. The Company is investing in process improvements and testing capabilities to ensure it can meet the rigorous standards of its international partners.

Investments

• As of the end of the first quarter of 2023, the Company had deployed capital on a portfolio of cannabis-related investments with a carrying value of $579.9 million, including $535.9 million through the SunStream Bancorp Inc. joint venture (“SunStream“).
• For the first quarter of 2023, the investment portfolio generated interest and fee revenue of $4.2 million, share of profit of equity-accounted investees generated from investments by SunStream of $9.5 million, and an investment loss of $5.2 million, on marketable securities, which includes unrealized losses on its publicly disclosed strategic investment in Village Farms International, Inc.
• SunStream’s credit portfolio currently consists of six investments: Jushi Holdings, SKYMINT Brands, Ascend Wellness Holdings, Parallel, Inc., Columbia Care Inc. and AFC Gamma, Inc.
• The Company continues to explore the potential monetization or equitization of some of its US senior credits. The Company is proactively pursuing opportunities to enhance its assets and generate higher earnings through strategic initiatives, recognizing their significant potential to create value.

Consolidated Financial Results

• General and administrative expenses for the three months ended March 31, 2023, were $48.6 million compared to $10.7 million for the three months ended March 31, 2022. The increase of $37.9 million was mainly due to increases in salaries and wages, office and general expenses, professional fees and merchant processing fees as a result of the Valens and Alcanna acquisitions.
• Net loss from continuing operations for the three months ended March 31, 2023, was $34.8 million compared to $38.0 million for the three months ended March 31, 2022. The decrease in net loss from continuing operations of $3.2 million was largely due to an increase in gross margin ($29.2 million), lower investment losses ($12.5 million), increased share of profit of equity-accounted investees ($5.4 million), lower transaction costs ($4.4 million) and change in fair value of derivative warrants ($13.1 million), partially offset by higher general and administrative expenses ($37.9 million), depreciation and amortization ($15.7 million) and finance costs ($5.2 million).

Liquidity Position

• As at March 31, 2023, and May 12, 2023, the Company had unrestricted cash balances of $213.3 million and $189.8 million, respectively, and a total of 260 million shares outstanding as at May 12, 2023.
• During the first quarter of 2023, a total of $48.9 million cash was used in operating activities, which included $13.5 million to replenish liquor inventory following the seasonal holiday draw in the fourth quarter of 2022, $2.7 million in severance and restructuring costs, and $17.5 million to stabilize Valens’ cash position and bring overdue accounts payable up to date. This included addressing unpaid liabilities, such as $4.9 million in excise tax, which had accumulated prior to the acquisition date. The lower gross profit from the liquor segment in the first quarter also contributed to the use of cash during the quarter.
• The Company’s share repurchase program continues to be available to lower the outstanding share float and increase the earnings per share for shareholders. However, due to an ongoing blackout period, the Company has been unable to repurchase shares in recent months. As SNDL comes out of the blackout period, it will assess opportunities to utilize the program to the extent that management believes SNDL’s shares are undervalued. For the three months ended March 31, 2023, the Company purchased and cancelled 0.5 million common shares at a weighted average price of $2.78 (US$2.04) per common share for a total cost of $1.5 million. SNDL’s management team is committed to creating value for its shareholders and will continue to assess opportunities to repurchase shares in the future.

STRATEGIC AND ORGANIZATIONAL UPDATE

SNDL remains focused on building long-term shareholder value through vertical integration, accretive deployment of cash resources, expansion of its retail distribution network, further streamlining of the Company’s operating structure and enhanced offerings of high-quality brands within both the Cannabis Operations and Cannabis Retail segments.

Integration Initiatives

The Company is pleased to report that the integration initiatives and cost synergies are progressing well, with more than $13 million in annual cost savings made in just five months since the Valens acquisition. SNDL has also identified over $5 million in additional annual cost savings that are expected to be realized in 2023. These initiatives place the Company on track to surpass its original $10 million cost savings target. Most of the cost savings have been realized through SG&A and public company costs, while the remainder will be achieved through supply chain consolidation and COGS. By 2024, run-rate synergies are expected to exceed $30 million annually, and proceeds from assets sales are expected to total $9 million.

The management team expects these cost savings will positively impact operating expenses and drive margin expansion in the third and fourth quarters of 2023. SNDL remains committed to its integration initiatives and will continue to update shareholders on its progress.

SPECIFIED FINANCIAL MEASURES

Certain specified financial measures in this news release are non-IFRS measures. These terms are not defined by IFRS and, therefore, may not be comparable to similar measures provided by other companies. These non-IFRS financial measures should not be considered in isolation or as an alternative for or superior to measures of performance prepared in accordance with IFRS. These measures are presented and described to provide shareholders and potential investors with additional measures in understanding the Company’s operating results in the same manner as the management team.

ADJUSTED EBITDA

Adjusted EBITDA is a non-IFRS measure which the Company uses to evaluate its operating performance. Adjusted EBITDA provides information to investors, analysts, and others to aid in understanding and evaluating the Company’s operating results in a manner similar to its management team. Adjusted EBITDA is defined as net income (loss) from continuing operations before finance costs, depreciation and amortization, accretion expense, income tax recovery and excluding changes in fair value of biological assets, changes in fair value realized through inventory, unrealized foreign exchange gains or losses, unrealized gains or losses on marketable securities, realized gains or losses on investments resulting from business combinations, changes in fair value of derivative warrants, share-based compensation expense, asset impairment, gain or loss on disposal of property, plant and equipment and certain one-time non-operating expenses, as determined by management.  The Company presents both consolidated, total Adjusted EBITDA and Adjusted EBITDA by operating segment.

This press release is intended to be read in conjunction with the Company’s Financial Statements and Notes for the period ended March 31, 2023, and the accompanying Management’s Discussion and Analysis (“MD&A“). These reports are available under the Company’s profile on SEDAR at www.sedar.com and EDGAR at www.sec.gov/edgar.shtml.

CONFERENCE CALL

The Company will hold a conference call and webcast at 1 p.m. EST (11 a.m. MST) on Monday, May 15, 2023.

WEBCAST ACCESS

To access the live webcast of the call, please visit the following link:
https://services.choruscall.ca/links/sndl2023q1.html

REPLAY

A telephone replay will be available for one month. To access the replay, dial:
Canada/USA Toll Free: 1-800-319-6413 or International Toll: +1-604-638-9010
When prompted, enter Replay Access Code: 0166#
The webcast archive will be available for three months via the link provided above.

ABOUT SNDL INC. 

SNDL is a public company whose shares are traded on the Nasdaq under the symbol “SNDL.”

SNDL is the largest private-sector liquor and cannabis retailer in Canada with retail banners that include Ace Liquor, Wine and Beyond, Liquor Depot, Value Buds, Spiritleaf, and Firesale Cannabis. SNDL is a licensed cannabis producer and one of the largest vertically integrated cannabis companies in Canada specializing in low-cost biomass sourcing, premium indoor cultivation, product innovation, low-cost manufacturing facilities, and a cannabis brand portfolio that includes Top Leaf, Contraband, Citizen Stash, Sundial Cannabis, Palmetto, Bon Jak, Spiritleaf Selects, Versus Cannabis, Value Buds, Vacay, Grasslands and Superette. SNDL’s investment portfolio seeks to deploy strategic capital through direct and indirect investments and partnerships throughout the global cannabis industry. For more information on SNDL, please go to www.sndl.com.

Forward-Looking Information Cautionary Statement

This news release includes statements containing certain “forward-looking information” within the meaning of applicable securities law (“forward-looking statements“), including, but not limited to, statements regarding the Company’s operational goals, demand for the Company’s products, the Company’s ability to achieve profitability or its goal of sustainable, positive gross margin and positive free cash flow, the development of the legal cannabis industry, performance of the Company’s investments, including through the SunStream joint venture, any potential forms of shareholder value creation, the ability to realize expected cost savings and the expansion of product offerings, brand and market share and retail networks, and the closing, integration and realization of expected benefits of, as applicable, the acquisition of The Valens Company, Zenabis and Superette. Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “likely”, “outlook”, “forecast”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Please see “Item 3.D.—Risk Factors” in the Company’s annual report on Form 20-F, filed with the Securities and Exchange Commission (“SEC“) on April 24, 2023, and the risk factors included in our other SEC filings for a discussion of the material risk factors that could cause actual results to differ materially from the forward-looking information. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

HYLA Investment Soars Booking $456,000 in First 90 Days With Six Million in Purchase Orders

CAVE CREEK, AZ, March 01, 2023 (GLOBE NEWSWIRE) — via NewMediaWire – Endexx Corporation (OTC: EDXC), a provider of innovative Hemp-derived wellness and skincare products, announced its Form 10Q, fiscal first quarter ending December 31, 2022.  Endexx continues to grow its CBD wellness and Skincare revenues. Supply chain issues continue to impact production, packaging and individual ingredient availability and may continue to delay some production runs in key product sets during 2023/2024. Competition in the industry is dwindling as the economic impact over the last two years has financially distressed many companies in the Hemp and CBD industries.  Endexx reported $320,369 in revenues in its first quarter of fiscal 2023 versus $274,591 in the first quarter of fiscal 2022.

2023 First Quarter Highlights: 

Endexx Investment in HYLA US

• HYLA shipped new product into four countries in Q1 realizing $456,400 in revenue
• HYLA sales are accelerating internationally and gaining early traction in the US
• HYLA has shipped into Italy generating revenues on purchase orders announced in Q1

“The first quarter showed continued growth in revenues in the CBD space and Skincare categories,” stated CEO Todd Davis.  Davis added, “Endexx is not currently consolidating the HYLA revenues into the Endexx financial statements. Endexx is excited and encouraged by the early success in its HYLA US investment.”

www.endexx.com & www.cbdunlimited.com

About Endexx Corporation 

Endexx Corporation, through its operating division CBD Unlimited, develops and distributes all-natural CBD products derived from cannabis sativa plant (Hemp), containing less than 0.01% THC. Its products range from oils, capsules, topicals, and pet products, all with the shared purpose of therapeutic and pain relief for humans and pets. Phyto-Bites are CBD soft chews for animal use that are formulated to promote health and support the reduction of separation anxiety, pain, and inflammation. The science behind these products involves over half a decade of clinical research in the field and lab work to provide accuracy in dosage and delivery of optimal absorption per serving.

Safe Harbor Notice

This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future development activities and are thus prospective. Forward-looking statements include all statements that are not statements of historical fact regarding intent, belief or current expectations of the company, its directors or its officers. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the company’s ability to control. Actual results may differ materially from those projected in the forward-looking statements. Among the factors that could cause actual results to differ materially from those indicated in the forward-looking statements are risks and uncertainties associated with the company’s business and finances in general, including the ability to continue and manage its growth, competition, global economic conditions and other factors discussed in detail in the Company’s periodic filings with the Securities and Exchange Commission. The company undertakes no obligation to update any forward-looking statements.

Contact:
For further investor and media information, contact:
Endexx Corporation
Todd Davis
Chairman & CEO
Endexx@endexx.com
480-595-6900

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About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.