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Core One Labs Provides Update on Financial Statements and Management Cease Trade Order

Vancouver, British Columbia, Canada – July 15, 2020 – Core One Labs Inc. (CSE: COOL), (OTCQX: CLABD), (Frankfurt: LD62, WKN: A2P8K3) (the “Company”). The Company wishes to advise its valued shareholders that the new management team (“Management”) is currently working with its auditor and accountants around the clock to finalize its audited financial statements and the related management’s discussion and analysis (“MD&A”) for the year-ended December 31, 2019. With the majority of the Company’s operations being located in California, COVID -19 has caused delays to the audit that are beyond Management’s control due to the ongoing border closure with the United States, travel restrictions arising from the ongoing pandemic, and related lockdowns imposed by the State of California.

Management continues to work closely with its auditor to ensure the audit is completed as close to the July 15th deadline as possible. At the outset, Management was able to identify the areas of the audit which required the most amount of attention, and moved to address those immediately, including deploying funds from the recently completed financing to settle an outstanding account with the auditors. Daily update calls are being done with the auditors and accountants to ensure the auditors have the full support of Management to expedite this process and ensure that shareholder value is not lost due to a prolonged cease trade.

The Company confirms that it has the financial resources necessary to complete the audit, and now anticipates being in a position to file the audited financial statements for the year-ended December 31, 2019, along with the interim financial statements for the three-month period ended March 31, 2020, and their related MD&A (collectively, the “Required Filings”), by July 31, 2020.

“With new management coming on board, our goal is to create shareholder value and build a strong Company. Although there were some clean-up issues when we took over management of the Company, we feel that we have a handle on all items that impact the Company, and are excited about moving the Company forward. The Company is now properly capitalized with two operating assets which are generating monthly revenue. I feel that we are in a strong position to grow the business and create shareholder value, once we get through this challenge,” said Joel Shacker, CEO of the Company.

The Company is currently subject to a management cease trade order (“MCTO”) issued by the British Columbia Securities Commission (“BCSC”) on June 16, 2020. The BCSC has now notified the Company that it will not consent to an extension of the MCTO beyond July 15, 2020, and as a result the Company anticipates that a general cease trade order will be issued by the BCSC. It is anticipated that a general cease trade order will remain in effect, and trading in the securities of the Company will be suspended, until the Required Filings are completed.

About Core One Labs Inc.

Core One Labs Inc. is a technology company that licenses its technology to a state-of- the-art production and packaging facility located in Southern California. The Company’s technology produces infused strips (like breath strips) that are not only a safer, healthier option to other forms of delivery but also superior bioavailability of cannabis constituents. Some strips will also include supplemental co-active ingredients such as nutraceuticals, vitamins and peptides. The technology provides a new way to accurately meter the dosage and assure the purity of selected product.

Core One Labs Inc.
Joel Shacker
Chief Executive Officer

FOR MORE INFORMATION, PLEASE CONTACT:

InvestorRelations@coreonelabs.ca 1-866-347-5058

Cautionary Disclaimer Statement:

The Canadian Securities Exchange, and its Regulation Services Provider, have not reviewed and do not accept responsibility for the adequacy or accuracy of the content of this news release.

Information set forth in this news release contains forward-looking statements that are based on assumptions as of the date of this news release. These statements reflect management’s current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. The Company cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company’s control. Such factors include, among other things: risks and uncertainties relating to the Company’s limited operating history and the need to comply with environmental and governmental regulations. In addition, marijuana remains a Schedule I drug under the United States Controlled Substances Act of 1970. Although Congress has prohibited the US Justice Department from spending federal funds to interfere with the implementation of state medical marijuana laws, this prohibition must be renewed each year to remain in effect. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information.

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Core One Labs Completes Acquisition of Interest in Medical Clinics

Vancouver, British Columbia, Canada – July 10, 2020 – Core One Labs Inc. (CSE: COOL), (OTCQX: CLABF), (Frankfurt: LD6, WKN: A14XHT) (the “Company”) is pleased to announce that it has completed the acquisition (the “Acquisition”) previously announced on June 5, 2020, of all of the outstanding share capital of Rejuva Alternative Medicine Research Centre Inc. (“Rejuva”) and one-quarter of the non-voting participating share capital of Shahcor Health Services Inc. (“Shahcor”),.

Rejuva and Shahcor are privately held companies which operate walk-in medical clinics located in Vancouver and West Vancouver, British Columbia, and maintain a database of over 200,000 patients, combined. The Company intends to further develop its product offerings through research and development in these clinics, including the integration of intellectual property related to psychedelic treatments and novel drug therapies. The Company will aim to prove increased efficacy and bioavailability of existing and novel drugs, including psilocybin, with its proprietary delivery methods currently utilized by its CannaStrip technology. Bioavailability of cannabis constituents in the Company’s CannaStrips infused strip allow for more efficient absorption of the active ingredients, which is an optimum delivery system for microdosing. Medical patients who want to receive alternative health treatments can use this less invasive way of treatment to help alleviate their symptoms and complications. Core One and Rejuva plan to advance psychedelic-derived treatments and establish a portfolio of intellectual property, through human clinical trials, to build a robust drug development platform in the psychedelic medicine space.

The Acquisition was completed pursuant to share exchange agreements, dated effective July 9, 2020, entered into with each of the shareholders of Rejuva and Shahcor. In consideration for all of the outstanding share capital of Rejuva, the Company has issued 23,000,000 common shares to the existing shareholders of Rejuva. In consideration for one-quarter of the non-voting participating share capital of Shahcor, the Company has made a one-time cash payment of $400,000 and has issued 5,555,556 common shares to the existing shareholders of Shahcor.

The existing shareholders of Shahcor will also be eligible to receive a one-time bonus payment of $1,000,000 (the “Bonus Payment”) in the event Shahcor achieves monthly recurring revenue of at least $30,000 in the three months following completion of the Acquisition. At the election of the Company, the Bonus Payment will be payable in cash, or common shares of the Company, based upon the volume-weighted average closing price of the common shares of the Company on the Canadian Securities Exchange in the ten trading days prior to the issuance of the shares.

The Company is at arms-length from each of Rejuva, Shahcor, and their respective shareholders. The Acquisition does not constitute a fundamental change for the Company, nor has it resulted in a change of control of the Company, within the meaning

of applicable securities laws and the policies of the Canadian Securities Exchange. In connection with completion of the Acquisition, the Company has issued 2,300,000 common shares (the “Finders Fee Shares”) to an arms-length third-party that assisted in introducing the Acquisition to the Company. The Company has also issued 571,111 common shares (the “Administrative Fee Shares”) and paid $8,000 as an administrative fee to a consultant who assisted with completion of the Acquisition. The Finders Fee Shares are subject to a statutory hold period, expiring on November 11, 2020, in accordance with applicable securities laws.

About Core One Labs Inc.

Core One Labs Inc. is a technology company that licenses its technology to a state-of-the-art production and packaging facility located in Southern California. The Company’s technology produces infused strips (like breath strips) that are not only a safer, healthier option to other forms of delivery but also superior bioavailability of cannabis constituents. Some strips will also include supplemental co-active ingredients such as nutraceuticals, vitamins and peptides. The technology provides a new way to accurately meter the dosage and assure the purity of selected product.

Core One Labs Inc.

Joel Shacker

Chief Executive Officer

FOR MORE INFORMATION, PLEASE CONTACT:

InvestorRelations@coreonelabs.ca

1-866-347-5058

Cautionary Disclaimer Statement:

The Canadian Securities Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.

Information set forth in this news release contains forward-looking statements that are based on assumptions as of the date of this news release. These statements reflect management’s current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. The Company cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company’s control. Such factors include, among other things: risks and uncertainties relating to the Company’s limited operating history and the need to comply with environmental and governmental regulations. In addition, marijuana remains a Schedule I drug under the United States Controlled Substances Act of 1970. Although Congress has prohibited the US Justice Department from spending federal funds to interfere with the implementation of state medical marijuana laws, this prohibition must be renewed each year to remain in effect. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information.

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Core One Labs Announces Effective Date of Share Consolidation

Vancouver, British Columbia, Canada – July 7, 2020 – Core One Labs Inc. (CSE: COOL), (OTCQX: CLABF), (Frankfurt: LD6, WKN: A14XHT) (the “Company”) is pleased to announce that its common shares will begin trading on a post-consolidated basis at the opening of markets on July 9, 2020 under the existing ticker symbol “COOL”.

As previously announced, the Company will be consolidating (the “Consolidation”) its outstanding common share capital on the basis of two (2) pre-Consolidation shares for every one (1) post-Consolidation share. As of the date of this news release, the Company has 79,081,741 common shares issued and outstanding. Following completion of the Consolidation, it is anticipated that the Company will have approximately 39,540,871 common shares issued and outstanding, not including rounding adjustments for any fractional amounts resulting from the Consolidation. The exercise price and number of common shares issuable upon the exercise of the Company’s outstanding options and warrants will be proportionally adjusted upon completion of the Consolidation in accordance with the terms thereof.

The Consolidation will be completed by way of “pushout”, without a letter of transmittal. Upon completion of the Consolidation, all pre-Consolidation share certificates will be considered null and void and the Company’s shareholders of record will receive Direct Registration Advice (DRS) statements with respect to the number of post-Consolidation shares held by such shareholders of record. Shareholders holding shares through brokers, banks or other intermediaries should consult with their broker, bank or other intermediary with respect to their post-Consolidation shareholdings.

The Company also announces that upon completion of the Consolidation it will grant a series of 2,100,000 incentive stock options (each, an “Option”) to certain consultants and employees of the Company. Each Option will vest immediately upon grant, and will be exercisable to acquire a post-Consolidation common share of the Company, at a price of $0.67 per share, for a period of sixty months.

About Core One Labs Inc.

Core One Labs Inc. is a technology company that licenses its technology to a state-of-the-art production and packaging facility located in Southern California. The Company’s technology produces infused strips (like breath strips) that are not only a safer, healthier option to other forms of delivery but also superior bioavailability of cannabis constituents. Some strips will also include supplemental co-active ingredients such as nutraceuticals, vitamins and peptides. The technology provides a new way to accurately meter the dosage and assure the purity of selected product.

Core One Labs Inc.

Joel Shacker

Chief Executive Officer

FOR MORE INFORMATION, PLEASE CONTACT:

InvestorRelations@coreonelabs.ca

1-866-347-5058

Cautionary Disclaimer Statement:

The Canadian Securities Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.

Information set forth in this news release contains forward-looking statements that are based on assumptions as of the date of this news release. These statements reflect management’s current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. The Company cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company’s control. Such factors include, among other things: risks and uncertainties relating to the Company’s limited operating history and the need to comply with environmental and governmental regulations. In addition, marijuana remains a Schedule I drug under the United States Controlled Substances Act of 1970. Although Congress has prohibited the US Justice Department from spending federal funds to interfere with the implementation of state medical marijuana laws, this prohibition must be renewed each year to remain in effect. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information.

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Vireo Health Appoints John Heller as Chief Financial Officer

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Numinus announces Clinical Advisory Council to advance integrated wellness model

Advisors including Dr. Gabor Maté and Zach Walsh bring training and expertise in psychedelic-assisted therapy and mental health treatment

VANCOUVER (June 24, 2020) – Numinus Wellness Inc. (“Numinus”; TSX-V: NUMI) is pleased to announce its Clinical Advisory Council, chaired by Numinus Chief Medical Officer Dr. Evan Wood. Leveraging the expertise of its members, the council will be responsible for program development, knowledge mobilization and driving policy change in the psychedelic assisted therapy space.

“Our Clinical Advisory Council brings together scientific, mental health and clinical leaders to explore the potential of psychedelic assisted therapies in a safe, controlled therapeutic environment,” says Dr. Wood. “The council will work with company leadership to drive Numinus forward and engage policy makers and legislators to create the conditions where psychedelic therapies can be considered and advanced.”

Joining Dr. Wood as initial members of the Clinical Advisory Council are recognized leaders in research and healthcare, including:

  • Dr. Gabor Maté, Retired Physician and Bestselling Author: Dr. Maté is a mental health and addiction specialist and retired physician who, after 20 years of family practice and palliative care experience, worked for over a decade in Vancouver’s Downtown Eastside with patients challenged by drug addiction and mental illness. Dr. Maté is a bestselling author who has pioneered therapies and innovative, trauma-based approaches to mental health, earning him widespread recognition from the healthcare community. drgabormate.com
  • Dr. Pam Kryskow, Physician and Clinical Instructor, University of British Columbia: Dr. Kryskow is trained in ketamine-assisted psychotherapy, chronic pain management, family medicine, rural emergency medicine and Functional Medicine. She practices medicine in British Columbia and is a clinical instructor in the Department of Medicine at the University of British Columbia. Dr. Kryskow is currently working with other university experts on research related to ketamine-assisted psychotherapy, psychedelic microdosing, MDMA for chronic pain, psilocybin and psychedelic therapy. She is actively involved with colleagues bringing scientific education around psychedelic medicines to the forefront. med.ubc.ca
  • Dr. Devon Christie, Medical Director, Numinus: Dr. Christie is a family physician with a focused practice in Multidisciplinary Pain Management and a Registered Therapeutic Counsellor, emphasizing Relational Somatic Therapy for trauma resolution. She is trained to deliver MDMA-assisted psychotherapy for PTSD (MAPS USA) and ketamine-assisted psychotherapy in a research setting. Dr. Christie is certified in Functional Medicine, Mindfulness-Based Stress Reduction, Interpersonal Mindfulness and Kundalini Yoga. She is a recognized speaker and expert on the potential of incorporating psychedelic-assisted therapies in an integrated healthcare model and is a teacher in the postgraduate ‘Certificate in Psychedelic-Assisted Therapies and Research’ program at the California Institute of Integral Studies (CIIS).
  • Zach Walsh, Associate Professor of Psychology, University of British Columbia: Walsh is a clinical psychologist and Research Affiliate with the BC Centre on Substance Use. As an associate professor of psychology at the University of British Columbia, he directs the Therapeutic, Recreational, and Problematic Substance Use lab. Walsh has published and presented widely on topics related to psychedelics, cannabis, mental health and psychotherapy. He is an investigator for several ongoing studies of the therapeutic use of psychedelics and has worked clinically on trials of psychedelic-assisted psychotherapy. psych.ubc.ca
  • Kate Browning, Registered Nurse and Administrator & Instructor, Holistic Health, Langara College: Browning is a registered nurse specialized in mental health and substance use, psychotherapist, somatic therapist specialized in trauma and attachment, educator and doctoral candidate in clinical psychology. She was trained in ketamine-assisted psychotherapy at the Orenda Institute and with the Center for Transformational Psychotherapy. Browning has worked in a variety of healthcare and educational settings for over 25 years as a clinician, clinical supervisor, consultant, educator and lecturer and is currently an administrator and instructor in Continuing Studies with Langara College’s Holistic Health division. She is a former licensed and registered midwife with extensive training in subtle energy and consciousness-based healing practices. langara.ca
  • Dr. Jason Marr, Founder & Director, Evoke Integrative Medicine Ltd.: Marr is a naturopathic doctor, performance and productivity coach and a health and wellness speaker. His evidence-informed, holistic and integrative approach helps professionals and corporate leadership teams overcome fatigue, anxiety and burnout while maximizing performance, productivity and resilience. evokemedicine.com

 

The Clinical Advisory Council will provide guidance and support on regulatory change, program design and protocol development. Members will leverage connections in the healthcare community to collaborate with leading researchers and groups working in mental illness, addiction and trauma treatment as well as provide their unique lenses of expertise on due diligence for clinic acquisitions and Numinus’s planned flagship wellness centre. The council adds strength to Numinus’s integrative approach to driving accessibility of psychedelic-assisted therapies for all.

“We’re proud to be working with the members of our Clinical Advisory Council to find new approaches to supplement existing treatment options for mental health, addiction and trauma,” says Numinus CEO Payton Nyquvest. “Their expertise will be vital as we work with health officials, leading research organizations, medical and therapeutic governing bodies and others to create an environment where psychedelic-assisted therapies can be made available as part of our healthcare system.”

Advisory Council Members

numinus.ca/team

 

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Contact:

Investor Inquiries:

invest@numinus.ca

Media Inquiries:

Emily Edwards, NATIONAL

eedwards@national.ca

604-842-6490

General Inquiries:

hello@numinus.ca

1-833-NUM-INUS (1-833-686-4687)

Pour investir et obtenir des renseignements généraux en français:

Remy Scalabrini, Maricom

investir@numinus.ca

888-585-6274

About Numinus

Numinus is a Vancouver-based health care company helping to support the universal desire to heal and be well. Through its wholly-owned subsidiary Salvation Botanicals, Numinus has a Health Canada cannabis testing licence that allows the Company to test and analyze cannabis products from licensed producers. In addition, it is a late-stage applicant to receive a Health Canada standard processing licence to produce cannabis products. Numinus, through the same subsidiary, also has a dealer’s licence which allows the Company to test, possess, buy and sell MDMA, psilocybin, psilocin, DMT and mescaline, as well as produce and extract psilocybin from mushrooms. The Health Canada license also allows import/export, testing and R&D of these substances. The expanded licence will allow Numinus to support the growing number of studies on the potential benefits of psychedelic therapies through research projects, product development, and the supply and distribution of these substances. Numinus Wellness is dedicated to therapies that enhance and supplement existing options for people wanting lasting physical, mental and emotional health — with psychedelic treatments at its core when approved for therapeutic and research use. Psychedelics will be part of this offering but will only be available for treatment once approved by regulators and governing bodies — a process Numinus is helping to support. For more information, visit www.numinus.ca.

Forward Looking Statements

This news release contains forward-looking statements within the meaning of applicable securities laws. All statements that are not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs of future performance, are “forward-looking statements.” Forward-looking statements 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 statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward looking statements. Such risks and uncertainties include, among others, dependence on obtaining and maintaining regulatory approvals, including acquiring and renewing federal, provincial, municipal, local or other licenses and any inability to obtain all necessary governmental approvals licenses and permits to operate and expand the Company’s facilities; regulatory or political change such as changes in applicable laws and regulations, including federal and provincial legalization, due to inconsistent public opinion, perception of the medical-use and adult-use marijuana industry, bureaucratic delays or inefficiencies or any other reasons; any other factors or developments which may hinder market growth; the Company’s limited operating history and lack of historical profits; reliance on management; the Company’s requirements for additional financing, and the effect of capital market conditions and other factors on capital availability; competition, including from more established or better financed competitors; and the need to secure and maintain corporate alliances and partnerships, including with research and development institutions, customers and suppliers. These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. Although the Company has attempted to identify important risk factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other risk factors that cause actions, events or results to differ from those anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. The Company has no obligation to update any forward-looking statement, even if new information becomes available as a result of future events, new information or for any other reason except as required by law.

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Vireo Health to Webcast Live at VirtualInvestorConferences.com June 24th

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Vireo Health Announces Sale of Equity in Pennsylvania Medical Solutions to Jushi Holdings Inc. for Total Consideration of $37 Million

– Transaction secures Vireo’s financial future without dilutive impacts to shareholders –
– Purchase price includes $16.3 million in cash and $17 million in future liabilities –
– Jushi receives 18-month option to acquire Equity in Pennsylvania Dispensary Solutions, LLC –

MINNEAPOLIS, June 22, 2020 /PRNewswire/ — Vireo Health International, Inc. (“Vireo” or the “Company”) (CNSX: VREO; OTCQX: VREOF), the science-focused, multi-state cannabis company with active operations in exclusively medical-only markets and licenses in nine states and the Commonwealth of Puerto Rico, today announced that it has reached a definitive agreement with Jushi Inc, a subsidiary of Jushi Holdings, Inc. (“Jushi”) (CSE: JUSH) (OTCQX: JUSHF), to divest equity in its subsidiary company, Pennsylvania Medical Solutions, LLC (“PAMS”), for total consideration of $37 million. The transaction is subject to regulatory approvals.

Vireo Logo (PRNewsfoto/Vireo Health, Inc.)

Pennsylvania Medical Solutions holds a permit for the cultivation and processing of medical cannabis in the state of Pennsylvania. This permit was initially awarded to PAMS through a merit-based application process in 2017. Based in Scranton, PAMS manufactures cannabis-based products in a 90,000 square foot co-located cultivation and processing facility, which recently underwent a significant capacity expansion project in order to meet increasing demand within Pennsylvania’s burgeoning medical cannabis market.

“This transaction secures Vireo’s capital position for the foreseeable future and will enable us to comfortably execute our fiscal year 2020 operating strategy and begin generating positive cash flow in the first half of next year without requiring any additional capital infusions,” said Founder & Chief Executive Officer, Kyle Kingsley, M.D. “We’re especially pleased to achieve this milestone for shareholders without the dilutive impacts of other forms of financing, and we’re also very excited about the opportunities in front of us to re-invest a portion of these proceeds to increase scale in select markets where we see significant opportunities to improve revenue growth and future cash flow generation.”

The transaction’s total consideration of $37 million includes $16.3 million in cash, $3.8 million in the form of a four-year note with an 8 percent coupon rate payable quarterly and $17 million in Right of Use liabilities associated with long-term lease obligations. The transaction also includes an 18-month option for Jushi to purchase equity in another Vireo Health subsidiary, Pennsylvania Dispensary Solutions, LLC, for an additional $5 million in cash.

Vireo management expects to utilize a portion of the transaction proceeds for capital expenditures that will increase scale in its core markets of New York, Minnesota, Maryland, Arizona, and New Mexico. These development projects are expected to significantly improve the Company’s near-term revenue and profitability outlook, and management anticipates discussing these development projects and other impacts of this transaction in more detail during the Company’s upcoming second-quarter earnings conference call in late August.

About Vireo Health International, Inc.

Vireo Health International, Inc. is a physician-led cannabis company focused on building long-term, sustainable value by bringing the best of medicine, science, and engineering to the cannabis industry. With operations strategically located in early-stage, limited-license medical markets, Vireo manufactures pharmaceutical-grade cannabis products in environmentally-friendly greenhouses and distributes its products through its growing network of Green Goods™ retail dispensaries and hundreds of third-party locations. Its current core medical markets of New York, Minnesota, Pennsylvania, Arizona, New Mexico, and Maryland all have the potential to enact adult-use legalization in the next three to 24 months, and two additional markets in Puerto Rico and Massachusetts also have potential for commercialization. Combined with its teams’ focus on driving scientific innovation within the industry and securing meaningful intellectual property, Vireo believes it is well positioned to become a global market leader in the cannabis industry. Today, eight of its 10 markets are operational with 13 of its 32 total retail dispensary licenses open for business. For more information about the company, please visit www.vireohealth.com.

About Jushi Holdings Inc.

Jushi Holdings, Inc. is a globally focused cannabis and hemp company led by an industry leading management team. In the United States, Jushi is focused on building a multi-state portfolio of branded cannabis and hemp-derived assets through opportunistic acquisitions, distressed workouts and competitive applications. Jushi strives to maximize shareholder value while delivering high quality products across all levels of the cannabis and hemp ecosystem. For more information please visit www.jushico.com or the Company’s social media channels on Instagram, Facebook, Twitter and LinkedIn.

Forward-Looking Statement Disclosure

This news release contains “forward-looking information” within the meaning of applicable United States and Canadian securities legislation. To the extent any forward-looking information in this news release constitutes “financial outlooks” within the meaning of applicable United States or Canadian securities laws, such information is being provided as preliminary financial results and the reader is cautioned that this information may not be appropriate for any other purpose and the reader should not place undue reliance on such financial outlooks. Forward-looking information contained in this press release may be identified by the use of words such as “plans,” “expects” or “does not expect,” “is expected,” “look forward to,” “budget” “scheduled,” “estimates,” “forecasts,” “will continue,” “intends,” “anticipates,” “does not anticipate,” “believes,” “should,” “should not,” or variations of such words and phrases or indicates that certain actions, events or results “may,” “could,” “would,” “might,” or “will” “be taken,” “occur,” or “be achieved.”  Forward-looking information may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, milestones, strategies and outlook of Vireo, and includes statements about, among other things, the value of assets, the amount of liabilities, the designation of certain businesses or assets as “core” or “non-core,” decisions about allocation of capital and other resources, future developments, the future operations, potential market opportunities including the potential effects of the approval of adult-use cannabis in one or more markets, potential opportunities to monetize assets, strengths and strategy of the Company. Forward-looking information is provided for the purpose of presenting information about management’s current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements should not be read as guarantees of future performance or results. Forward-looking information includes statements with respect to the opportunities for the Company to leverage increasing scale to improve sales growth and operating performance; the anticipation that the medical-only state markets in which the Company’s subsidiaries operate could enact recreational-use legislation over the near-to mid-term future; the anticipated benefits of strategic initiatives; the effects of reduction of corporate overhead and SG&A expenses; improvement to unit economics; expansion of retail dispensaries in key markets; and the expectation that such expansion will drive stronger revenue growth, operating margins and free cash flow. Forward-looking information includes both known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company 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 including, without limitation, the impact on the Company’s businesses and financial results of epidemics and pandemics, including the COVID-19 pandemic. Financial outlooks, as with forward-looking information generally, are, without limitation, based on the assumptions and subject to various risks as set out herein. Our actual financial position and results of operations may differ materially from management’s current expectations and, as a result, our revenue and cash on hand may differ materially from the revenue and cash values provided in this news release. Forward-looking information is based upon a number of estimates and assumptions of management, believed but not certain to be reasonable, in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors relevant in the circumstances, including assumptions in respect of current and future market conditions, the current and future regulatory environment; and the availability of licenses, approvals and permits.

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, including preliminary financial expectations regarding the annualized reduction of corporate overhead and SG&A expenses. Actual results and developments may differ materially from those contemplated by these statements. Forward-looking information is subject to a variety of risks and uncertainties that could cause actual events or results to differ materially from those projected in the forward-looking information. Such risks and uncertainties include, but are not limited to, risks related to preliminary financial results being subject to the completion of the Company’s financial closing procedures and not being audited or reviewed by the Company’s independent registered public accounting firm; the timing of recreational-use legislation in markets where the Company currently operates; current and future market conditions, including the market price of the subordinate voting shares of the Company; federal, state, local and foreign government laws, rules and regulations, including federal and state laws in the United States relating to cannabis operations in the United States; limited operating history; changes in laws, regulations and guidelines; operational, regulatory and other risks; execution of business strategy; management of growth; difficulty to forecast; conflicts of interest; risks inherent in an agricultural business; liquidity and additional financing; foreign private issuer status and the risk factors set out in the Company’s listing statement dated March 19, 2019, filed with the Canadian securities regulators and available under the Company’s profile on SEDAR at www.sedar.com.

The statements in this news release are made as of the date of this release. The Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

Media Inquiries

Investor Inquiries

Albe Zakes

Sam Gibbons

Vice President, Corporate Communications

Vice President, Investor Relations

albezakes@vireohealth.com

samgibbons@vireohealth.com 

(267) 221-4800

(612) 314-8995

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SOURCE Vireo Health International, Inc.

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Vireo Health Expands Maryland Operations with Purchase of 110,000 Sq. Ft. Greenhouse

– $1.3 million cash transaction expands Vireo’s Maryland cultivation capacity by nearly 12x –
– Vireo to transfer cultivation license to new greenhouse; maintain existing processing facility –

MINNEAPOLIS, June 19, 2020 /PRNewswire/ — Vireo Health International, Inc. (“Vireo” or the “Company”) (CNSX: VREO; OTCQX: VREOF), the science-focused, multi-state cannabis company with active operations in exclusively medical-only markets and licenses in nine states and the Commonwealth of Puerto Rico, today announced that its subsidiary company, MaryMed, LLC, has reached a definitive agreement to acquire the assets and operations of Maryland based Goose Landing Farms, Inc., for total consideration of $1.3 million. The transaction is subject to regulatory approval and customary closing conditions.

Vireo Logo (PRNewsfoto/Vireo Health, Inc.)

Goose Landing Farms owns and operates a 110,200 sq. ft. greenhouse facility in Massey, MD which is currently growing perennials. The site also contains an indoor area for post processing. MaryMed intends to transfer its cultivation license in the state to this newly acquired greenhouse and maintain processing and manufacturing operations at its existing 22,000 sq. ft. facility in Hurlock, MD. This planned license transfer is expected to increase MaryMed’s biomass cultivation capacity in the state by nearly 12 times once the transfer of cultivation operations is complete. Vireo anticipates completing its first harvest in the new facility during the upcoming Fall season.

“This acquisition significantly increases our revenue growth potential in Maryland’s attractive medical cannabis market at a relatively low cost, and it will enable us to drive stronger profitability within this market once our retail dispensary license becomes operational,” said Founder & Chief Executive Officer, Kyle Kingsley, M.D. “This transaction is consistent with our objective of increasing scale in our core markets to improve margins and cash flow generation, and we’re looking forward to seeing the benefits of this acquisition on revenue growth and profitability beginning in the fourth quarter of this year.”

About Vireo Health International, Inc.

Vireo Health International, Inc. is a physician-led cannabis company focused on building long-term, sustainable value by bringing the best of medicine, science, and engineering to the cannabis industry. With operations strategically located in early-stage, limited-license medical markets, Vireo manufactures pharmaceutical-grade cannabis products in environmentally-friendly greenhouses and distributes its products through its growing network of Green Goods™ retail dispensaries and hundreds of third-party locations. Its current core medical markets of New York, Minnesota, Pennsylvania, Arizona, New Mexico, and Maryland all have the potential to enact adult-use legalization in the next three to 24 months, and two additional markets in Puerto Rico and Massachusetts also have potential for commercialization. Combined with its teams’ focus on driving scientific innovation within the industry and securing meaningful intellectual property, Vireo believes it is well positioned to become a global market leader in the cannabis industry. Today, eight of its 10 markets are operational with 13 of its 32 total retail dispensary licenses open for business. For more information about the company, please visit www.vireohealth.com.

Forward-Looking Statement Disclosure

This news release contains “forward-looking information” within the meaning of applicable United States and Canadian securities legislation. To the extent any forward-looking information in this news release constitutes “financial outlooks” within the meaning of applicable United States or Canadian securities laws, such information is being provided as preliminary financial results and the reader is cautioned that this information may not be appropriate for any other purpose and the reader should not place undue reliance on such financial outlooks. Forward-looking information contained in this press release may be identified by the use of words such as “plans,” “expects” or “does not expect,” “is expected,” “look forward to,” “budget” “scheduled,” “estimates,” “forecasts,” “will continue,” “intends,” “anticipates,” “does not anticipate,” “believes,” “should,” “should not,” “looking forward to,” or variations of such words and phrases or indicates that certain actions, events or results “may,” “could,” “would,” “might,” or “will” “be taken,” “occur,” or “be achieved.”  Forward-looking information may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, milestones, strategies and outlook of Vireo, and includes statements about, among other things, the value of assets, the amount of liabilities, the designation of certain businesses or assets as “core” or “non-core,” decisions about allocation of capital and other resources, future developments, the future operations, potential market opportunities including the potential effects of the approval of adult-use cannabis in one or more markets, potential opportunities to monetize assets, strengths and strategy of the Company. Forward-looking information is provided for the purpose of presenting information about management’s current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements should not be read as guarantees of future performance or results. Forward-looking information includes statements with respect to the opportunities for the Company to leverage increasing scale to improve sales growth and operating performance; the anticipation that the medical-only state markets in which the Company’s subsidiaries operate could enact recreational-use legislation over the near-to mid-term future; the anticipated benefits of strategic initiatives; the effects of reduction of corporate overhead and SG&A expenses; improvement to unit economics; expansion of retail dispensaries in key markets; and the expectation that such expansion will drive stronger revenue growth, operating margins and free cash flow. Forward-looking information includes both known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company 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 including, without limitation, the impact on the Company’s businesses and financial results of epidemics and pandemics, including the COVID-19 pandemic. Financial outlooks, as with forward-looking information generally, are, without limitation, based on the assumptions and subject to various risks as set out herein. Our actual financial position and results of operations may differ materially from management’s current expectations and, as a result, our revenue and cash on hand may differ materially from the revenue and cash values provided in this news release. Forward-looking information is based upon a number of estimates and assumptions of management, believed but not certain to be reasonable, in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors relevant in the circumstances, including assumptions in respect of current and future market conditions, the current and future regulatory environment; and the availability of licenses, approvals and permits.

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, including preliminary financial expectations regarding the annualized reduction of corporate overhead and SG&A expenses. Actual results and developments may differ materially from those contemplated by these statements. Forward-looking information is subject to a variety of risks and uncertainties that could cause actual events or results to differ materially from those projected in the forward-looking information. Such risks and uncertainties include, but are not limited to, risks related to preliminary financial results being subject to the completion of the Company’s financial closing procedures and not being audited or reviewed by the Company’s independent registered public accounting firm; the timing of recreational-use legislation in markets where the Company currently operates; current and future market conditions, including the market price of the subordinate voting shares of the Company; federal, state, local and foreign government laws, rules and regulations, including federal and state laws in the United States relating to cannabis operations in the United States; limited operating history; changes in laws, regulations and guidelines; operational, regulatory and other risks; execution of business strategy; management of growth; difficulty to forecast; conflicts of interest; risks inherent in an agricultural business; liquidity and additional financing; foreign private issuer status and the risk factors set out in the Company’s listing statement dated March 19, 2019, filed with the Canadian securities regulators and available under the Company’s profile on SEDAR at www.sedar.com.

The statements in this news release are made as of the date of this release. The Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

 

Media Inquiries

Investor Inquiries

Albe Zakes

Sam Gibbons

Vice President, Corporate Communications 

Vice President, Investor Relations

albezakes@vireohealth.com

samgibbons@vireohealth.com 

(267) 221-4800

(612) 314-8995

 

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SOURCE Vireo Health International, Inc.

Posted on

Vireo Health Announces First Quarter 2020 Financial Results

– First-quarter revenue of $12.1 million increased 34% sequentially and 110% year-over-year –
– Minimal capex requirements position Company for stronger second half compared to 2019 –
– Recent cost reduction initiatives to begin materializing in results during the second quarter –

MINNEAPOLIS, June 16, 2020 /PRNewswire/ — Vireo Health International, Inc. (“Vireo” or the “Company”) (CNSX: VREO; OTCQX: VREOF), the science-focused, multi-state cannabis company with active operations in exclusively medical-only markets and licenses in nine states and the Commonwealth of Puerto Rico, today reported financial results for its first quarter ended March 31, 2020. All currency figures referenced in this release reflect U.S. dollar amounts.

Vireo Logo (PRNewsfoto/Vireo Health, Inc.)

“Our first-quarter results demonstrate the improving trajectory of our business, with sequential revenue growth of 34 percent representing the strongest quarter of growth in Vireo’s history,” said Founder & Chief Executive Officer, Kyle Kingsley, M.D. “As we continue to focus on optimizing our core medical markets, we believe there is significant untapped potential for Vireo to improve revenue growth and profitability as we increase scale in these attractive, limited-license jurisdictions.”

Dr. Kingsley continued, “We have many opportunities to continue growing our business organically through new product introductions, by expanding our footprint of operational dispensaries, and by continuing to improve our overall product and sales channel mix as compared to prior quarters. We’re also cautiously optimistic that recent enhancements to point-of-sale protocols in response to COVID-19 like telemedicine consultations and curbside pick-up may become permanent in several of our markets, and we continue to believe that each of our core medical markets has the potential to enact adult-use legislation over the near- to medium-term future.”

First Quarter 2020 Financial Summary

The Company generated operating revenue in seven states during the first quarter: Arizona, Maryland, Minnesota, New Mexico, New York, Ohio, and Pennsylvania. Total revenue increased 34 percent sequentially and 110 percent year-over-year to $12.1 million versus $5.8 million in the first quarter of 2019.

Retail revenue was approximately $8.2 million in Q1 2020, an increase of 58 percent compared to $5.2 million in Q1 2019. Wholesale revenue of $3.9 million increased by $3.3 million as compared to $610,881 in Q1 2019, with the increase principally due to the acquisitions of wholesale businesses in Arizona in the prior-year quarter and the growth of wholesale operations in Pennsylvania and Maryland.

Gross profit before fair value adjustments was $3.4 million, or 28 percent of revenue, as compared to gross profit of $2.1 million or 37 percent, in the same period last year. The variance in gross profit as compared to the prior year was driven primarily by a temporary increase in the mix of sales in wholesale versus retail markets, a product sales mix shift to address demand for concentrated distillate products, and greater competition across several markets as they mature.

Total operating expenses in the first quarter were $9.7 million, as compared to $3.7 million in the first quarter of 2019, with the increase primarily attributable to increased salaries and wages, professional fees, and general and administrative expenses necessary to support the Company’s growth.

Total other expense was $995,008 during Q1 2020, compared to $4.6 million in Q1 2019. The favorable reduction in other expense was primarily attributable to the non-recurrence of $3.5 million in listing expenses related to the Company’s go-public transaction in the prior-year quarter, and a gain on derivative liability of $1.3 million.

Net loss in Q1 2020 was $2.0 million, as compared to net loss of $3.4 million in Q1 2019. Adjusted net loss for Q1 2020 was $8.1 million, as compared to a loss of $4.8 million in the prior year quarter.  Adjusted EBITDA, as described in accompanying disclosures and footnotes, was a loss of $3.3 million in Q1 2020, as compared to a loss of $1.2 million in Q1 2019. Please refer to the Supplemental Information and Reconciliation of Non-IFRS Financial Measures at the end of this press release for additional information.

Other Developments

There was a global outbreak of a new strain of coronavirus, COVID-19, during the first quarter. Vireo’s medical cannabis businesses were deemed “essential” in each of its operational markets, and to date there has been no material adverse impact on the Company’s financial performance because of the virus.

During the first quarter, the Company implemented several strategic initiatives to optimize its cost structure and operating model. These initiatives included shuttering the Company’s New York corporate office, the related termination of an office lease, the reduction of its workforce by approximately nine percent, and the elimination of certain other costs.

On March 10, 2020, the Company announced that it had closed a non-brokered private placement of CAD $10.0 million of 13,651,574 units of the Company. Each Unit is comprised of one subordinate voting share in the capital of Vireo (a “Share”) and one subordinate voting share purchase warrant of Vireo (a “Warrant”). Each Warrant entitles the holder to purchase one Share (a “Warrant Share”) for a period of three years from the date of issuance at an exercise price of CAD $0.96 per Warrant Share, subject to adjustment in certain events. The Company intends to use the proceeds from the Offering to fund various growth initiatives and for working capital and general corporate purposes.

On April 30, 2020, the Company announced the formation of a wholly-owned subsidiary called Resurgent Biosciences, Inc. Resurgent Biosciences is a Delaware corporation which has been created with the intent to commercialize Vireo’s portfolio of intellectual property and related initiatives in a non-plant-touching entity which may broaden potential partnership opportunities or other strategic outcomes as Vireo seeks to monetize scientific advancements within the cannabis industry and beyond. Vireo currently has several patent applications pending approval by the United States Patent and Trademark Office. Its patent for harm reduction in tobacco products was allowed earlier this year.

Balance Sheet and Liquidity

As of March 31, 2020, total current assets were $62.2 million, including cash on hand of $11.7 million. Total current liabilities were $7.0 million, with zero debt currently due within 12 months.

As of March 31, 2020, the Company had 37,952,477 equity shares issued and outstanding, and 153,463,362 shares outstanding on an as-converted, fully-diluted basis.

Outlook Commentary

Dr. Kingsley concluded, “With most of the major development projects in our core markets effectively complete, we expect minimal capital expenditures during the remainder of fiscal year 2020, and we should also begin to see the benefits of recent cost reduction initiatives materialize more substantially in our second quarter results. The optionality of our valuable collection of state-based cannabis licenses and intellectual property continues to provide substantial opportunities to improve our cash position and future financial performance, and we believe our six core market strategy will enable us to begin generating positive cash flow in the first half of next year.”

Conference Call and Webcast Information

Vireo Health management will host a conference call with research analysts on Tuesday, June 16, 2020 at 8:00 a.m. ET to discuss its financial results for its first quarter ended March 31, 2020. The conference call may be accessed by dialing 833-714-0863 (Toll-Free) or 778-560-2618 (International) and entering conference ID 7783416.

A live audio webcast of this event will also be available in the Events & Presentations section of the Company’s Investor Relations website at https://investors.vireohealth.com/events-and-presentations/default.aspx and will be archived for one year.

Additional Information

Additional information relating to the Company’s first quarter 2020 results is available on SEDAR at www.sedar.com. Vireo Health refers to certain non-IFRS financial measures such as adjusted net income, Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and adjusted EBITDA (defined as earnings before interest, taxes, depreciation, amortization, less certain non-cash equity compensation expense, one-time transaction fees, and other non-cash items. These measures do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other issuers. Please see the Supplemental Information and Reconciliation of Non-IFRS Financial Measures at the end of this news release for more detailed information regarding non-IFRS financial measures.

About Vireo Health International, Inc.

Vireo Health International, Inc. is a physician-led cannabis company focused on building long-term, sustainable value by bringing the best of medicine, science, and engineering to the cannabis industry. With operations strategically located in early-stage, limited-license medical markets, Vireo manufactures pharmaceutical-grade cannabis products in environmentally-friendly greenhouses and distributes its products through its growing network of Green Goods™ retail dispensaries and hundreds of third-party locations. Its current core medical markets of New York, Minnesota, Pennsylvania, Arizona, New Mexico, and Maryland all have the potential to enact adult-use legalization in the next three to 24 months, and two additional markets in Puerto Rico and Massachusetts also have potential for commercialization. Combined with its teams’ focus on driving scientific innovation within the industry and securing meaningful intellectual property, Vireo believes it is well positioned to become a global market leader in the cannabis industry. Today, eight of its 10 markets are operational with 13 of its 32 total retail dispensary licenses open for business. For more information about the company, please visit www.vireohealth.com.

Forward-Looking Statement Disclosure

This news release contains “forward-looking information” within the meaning of applicable United States and Canadian securities legislation. To the extent any forward-looking information in this news release constitutes “financial outlooks” within the meaning of applicable United States or Canadian securities laws, such information is being provided as preliminary financial results and the reader is cautioned that this information may not be appropriate for any other purpose and the reader should not place undue reliance on such financial outlooks. Forward-looking information contained in this press release may be identified by the use of words such as “plans,” “expects” or “does not expect,” “is expected,” “look forward to,” “budget” “scheduled,” “estimates,” “forecasts,” “will continue,” “intends,” “anticipates,” “does not anticipate,” “believes,” “should,” “should not,” or variations of such words and phrases or indicates that certain actions, events or results “may,” “could,” “would,” “might,” or “will” “be taken,” “occur,” or “be achieved.”  Forward-looking information may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, milestones, strategies and outlook of Vireo, and includes statements about, among other things, the value of assets, the amount of liabilities, the designation of certain businesses or assets as “core” or “non-core,” decisions about allocation of capital and other resources, future developments, the future operations, potential market opportunities including the potential effects of the approval of adult-use cannabis in one or more markets, potential opportunities to monetize assets, strengths and strategy of the Company. Forward-looking information is provided for the purpose of presenting information about management’s current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements should not be read as guarantees of future performance or results. Forward-looking information includes statements with respect to the opportunities for the Company to leverage increasing scale to improve sales growth and operating performance; the anticipation that the medical-only state markets in which the Company’s subsidiaries operate could enact recreational-use legislation over the near-to mid-term future; the anticipated benefits of strategic initiatives; the effects of reduction of corporate overhead and SG&A expenses; improvement to unit economics; expansion of retail dispensaries in key markets; and the expectation that such expansion will drive stronger revenue growth, operating margins and free cash flow. Forward-looking information includes both known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company 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 including, without limitation, the impact on the Company’s businesses and financial results of epidemics and pandemics, including the COVID-19 pandemic. Financial outlooks, as with forward-looking information generally, are, without limitation, based on the assumptions and subject to various risks as set out herein. Our actual financial position and results of operations may differ materially from management’s current expectations and, as a result, our revenue and cash on hand may differ materially from the revenue and cash values provided in this news release. Forward-looking information is based upon a number of estimates and assumptions of management, believed but not certain to be reasonable, in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors relevant in the circumstances, including assumptions in respect of current and future market conditions, the current and future regulatory environment; and the availability of licenses, approvals and permits.

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, including preliminary financial expectations regarding the annualized reduction of corporate overhead and SG&A expenses. Actual results and developments may differ materially from those contemplated by these statements. Forward-looking information is subject to a variety of risks and uncertainties that could cause actual events or results to differ materially from those projected in the forward-looking information. Such risks and uncertainties include, but are not limited to, risks related to preliminary financial results being subject to the completion of the Company’s financial closing procedures and not being audited or reviewed by the Company’s independent registered public accounting firm; the timing of recreational-use legislation in markets where the Company currently operates; current and future market conditions, including the market price of the subordinate voting shares of the Company; federal, state, local and foreign government laws, rules and regulations, including federal and state laws in the United States relating to cannabis operations in the United States; limited operating history; changes in laws, regulations and guidelines; operational, regulatory and other risks; execution of business strategy; management of growth; difficulty to forecast; conflicts of interest; risks inherent in an agricultural business; liquidity and additional financing; foreign private issuer status and the risk factors set out in the Company’s listing statement dated March 19, 2019, filed with the Canadian securities regulators and available under the Company’s profile on SEDAR at www.sedar.com.

The statements in this news release are made as of the date of this release. The Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

Supplemental Information

The financial information reported in this news release is based on audited financial statements for the fiscal year ended December 31, 2019 and unaudited condensed interim consolidated financial statements for the fiscal quarter ended March 31, 2020. All financial information contained in this news release is qualified in its entirety with reference to such financial statements. To the extent that the financial information contained in this news release is inconsistent with the information contained in the Company’s audited financial statements, the financial information contained in this news release shall be deemed to be modified or superseded by the Company’s audited financial statements. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation for purposes of applicable securities laws.

 

VIREO HEALTH INTERNATIONAL, INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

As at March 31, 2020 and December 31, 2019

(Unaudited – Expressed in United States Dollars)

March 31,

December 31,

2020

2019

ASSETS

Current Assets

Cash

$               11,729,866

$                    7,641,673

Restricted Cash

1,592,500

1,592,500

Receivables

859,212

1,025,963

Inventories

30,460,205

32,437,308

Biological Assets

16,334,123

6,134,209

Prepaid Expenses

1,151,981

2,285,548

Deferred acquisition costs

28,136

28,136

62,156,023

51,145,337

Non-Current Assets

Right of Use Assets

32,019,710

25,921,603

Property and Equipment

13,533,060

13,326,337

Deposits

2,626,366

2,651,366

Deferred Loss on Sale Leaseback

–

30,481

Goodwill

3,132,491

3,132,491

Intangible Asset

8,847,047

9,001,237

60,158,674

54,063,515

Total Assets

$          122,314,697

$             105,208,852

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current Liabilities

Accounts Payable and Accrued Liabilities

$               4,285,630

$                  3,140,086

Current portion of Right of Use Liability

480,610

619,827

Derivative Liability

2,229,101

–

6,995,341

3,759,913

Long-Term Liabilities

Deferred Income Taxes

6,767,000

4,528,000

Right of Use Liability

35,507,281

28,665,681

Long-Term Debt

1,110,000

1,110,000

Convertible debt

836,644

817,446

51,216,266

38,881,040

Shareholders’ Equity

Share Capital

122,511,602

118,453,142

Reserves

10,698,447

7,962,509

Deficit

(62,111,618)

(60,087,839)

71,098,431

66,327,812

Total Liabilities and Equity

$          122,314,697

$             105,208,852

 

 

VIREO HEALTH INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS

For the Three Months Ended March 31, 2020 and 2019

(Unaudited – Expressed in United States Dollars)

Three Months Ended

Three Months Ended

March 31,

March 31,

2020

2019

REVENUE

$           12,118,567

$                     5,777,792

Production Costs

(8,701,653)

(3,665,869)

Gross Profit Before Fair Value Adjustments

3,416,914

2,111,923

Realized Fair Value Amounts Included in Inventory Sold

(7,768,781)

(3,026,731)

Unrealized Fair Value Gain on Growth of Biological Assets

15,725,754

8,065,726

Gross Profit

11,373,887

7,150,918

EXPENSES

Depreciation

315,278

373,779

Professional fees

729,121

574,260

Salaries and wages

3,564,715

1,152,940

Selling, general and administrative expenses

2,313,506

1,444,749

Share Based Compensation

2,735,938

201,187

9,658,558

3,746,915

OTHER INCOME (EXPENSE)

Loss on sale of property and equipment

(13,800)

(484)

Interest expense

(1,712,656)

(1,023,815)

Accretion expense

(19,198)

(9,671)

Listing expense

–

(3,464,613)

Gain (Loss) on derivative liability

1,325,928

–

Inventory impairment

(139,008)

–

Other expense

(436,274)

(140,179)

Total Other Income (Expense)

(995,008)

(4,638,762)

 INCOME (LOSS) BEFORE INCOME TAXES 

720,321

(1,234,759)

Current income taxes

(505,100)

(745,000)

Deferred income taxes

(2,239,000)

(1,467,000)

PROVISION (RECOVERY) FOR INCOME TAXES

(2,744,100)

(2,212,000)

LOSS AND COMPREHENSIVE LOSS

$         (2,023,779)

$                 (3,446,759)

Weighted Average Shares Outstanding – basic and diluted

88,519,845

59,757,979

Net Loss Per Share – basic and diluted

$                  (0.02)

$                          (0.06)

 

 

VIREO HEALTH INTERNATIONAL, INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

For the Three Months Ended March 31, 2020 and 2019

(Unaudited – Expressed in United States Dollars)

Three Months Ended

Three Months Ended

March 31,

March 31,

2020

2019

Cash Flows from Operating Activities:

     Net income (loss)

$              (2,023,779)

$              (3,446,759)

      Item not affecting cash: 

     Depreciation and amortization

469,467

373,779

     Loss on sale of property and equipment

13,800

484

     Share-based compensation

2,735,938

201,187

     Gain on derivative liability

(1,325,928)

–

     Fair value adjustment on sale of inventory

7,768,781

3,026,731

     Fair value adjustment on growth of biological assets

(15,725,754)

(8,065,726)

     Interest expense

1,723,368

1,033,562

     Deferred income taxes

2,239,000

1,467,000

     Deferred financing costs

–

448,480

     Listing expense

–

2,999,986

     Amortization of deferred tenant improvements

–

(87,143)

     Deferred gain/loss on sale leaseback

30,481

–

     Changes in non-cash working capital

2,768,567

87,710

Cash Flows Used in Operating Activities

(1,326,059)

(1,960,709)

Cash Flows from Investing Activities:

Purchase of property and equipment

(506,336)

(984,732)

Acquisition costs on business combinations and assets

–

(12,715,901)

Deferred acquisition costs

–

(48,162)

Deposits

25,000

–

Cash Flows from Investing Activities

(481,336)

(13,748,795)

Cash Flows from Financing Activities:

Proceeds from sale of stock, net of issuance costs

7,613,490

47,542,878

Lease payments

(183,876)

(126,251)

Interest paid

(1,534,026)

(930,325)

Cash Flows from Financing Activities

5,895,588

46,486,302

Net Change in Cash 

$               4,088,193

$             30,776,798

Cash, Beginning of the Year

7,641,673

9,264,110

Cash, End of the Year

$             11,729,866

$             40,040,908

 

 

Reconciliation of Non-IFRS Financial Measures

EBITDA, Adjusted Net loss EBITDA and Adjusted EBITDA are non-IFRS measures and do not have standardized definitions under IFRS. The following information provides reconciliations of the supplemental non-IFRS financial measures, presented herein to the most directly comparable financial measures calculated and presented in accordance with IFRS. The Company has provided the non-IFRS financial measures, which are not calculated or presented in accordance with IFRS, as supplemental information and in addition to the financial measures that are calculated and presented in accordance with IFRS. These supplemental non-IFRS financial measures are presented because management has evaluated the financial results both including and excluding the adjusted items and believe that the supplemental non-IFRS financial measures presented provide additional perspective and insights when analyzing the core operating performance of the business. These supplemental non-IFRS financial measures should not be considered superior to, as a substitute for or as an alternative to, and should be considered in conjunction with, the IFRS financial measures presented.

Reconciliation of Net Loss to Adjusted Net Loss and Adjusted EBITDA

Three Months Ended

March 31,

2020

2019

Net loss

$         (2,023,779)

$       (3,446,759)

Net fair value adjustments

(7,956,973)

(5,038,995)

Listing expense

–

3,464,613

Gain (Loss) on Derivative Liability

(1,325,928)

–

Inventory adjustment

139,008

–

Share-based compensation

2,735,938

201,187

Severance Expense

339,997

–

Adjusted net loss (non-IFRS)

$         (8,091,737)

$       (4,819,954)

Net loss

$         (2,023,779)

$       (3,446,759)

Interest income

(124)

(76)

Interest expense

1,712,780

1,023,891

Accretion expense

19,198

9,671

Income taxes

2,744,100

2,212,000

Depreciation

315,278

373,779

EBITDA (non-IFRS)

$           2,767,453

$           172,506

Net fair value adjustments

(7,956,973)

(5,038,995)

Listing expense

–

3,464,613

Gain (Loss) on Derivative Liability

(1,325,928)

–

Inventory adjustment

139,008

–

Share-based compensation

2,735,938

201,187

Severance Expense

339,997

–

Adjusted EBITDA (non-IFRS)

$         (3,300,505)

$       (1,200,689)

Net Loss Per Share – basic and diluted for the three months ended March 31, 2020 and 2019 was $(0.02)and $(0.06), respectively.

 

 

Media Inquiries
Albe Zakes
Vice President, Corporate Communications
albezakes@vireohealth.com
(267) 221-4800

Investor Inquiries
Sam Gibbons
Vice President, Investor Relations
samgibbons@vireohealth.com
(612) 314-8995

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SOURCE Vireo Health International, Inc.

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