Christina Lake Cannabis Provides Financial Results for the Third Quarter of its Fiscal 2021 Year

0
22

VANCOUVER, British Columbia, Nov. 01, 2021 (GLOBE NEWSWIRE) — Christina Lake Cannabis Corp. (the “Company” or “CLC” or “Christina Lake Cannabis”) (CSE: CLC) (OTCQB: CLCFF) (FRANKFURT: CLB) is pleased to provide a summary overview of financial and operational results for its fiscal Q3 2021 (three and nine months ended August 31, 2021). During this period, the Company had its highest sales quarter since inception with repeat orders coming from key industry buyers and producers of consumer products including vape and edible manufacturers. For a comprehensive overview of the Company’s disclosed developments in its fiscal Q3 2021 including the Management’s Discussion and Analysis (“MD&A”) dated October 29, 2021, please access the Company’s profile on SEDAR.

All monetary figures in this press release are in Canadian dollars unless specified otherwise.

Primary Highlights for Christina Lake Cannabis in Q3 of Fiscal 2021 (ended Aug. 31, 2021)

  • Gross Revenue increased +495% in Q3 2021 to $1,290,000 compared to $216,738 in Q2 2021;
  • General and Administrative Expenses decreased 10.4% in Q3 2021 to $1,666,031 compared to $1,858,867 in Q2 2021;
  • Total of $24,808,196 in assets and a net working capital balance (current assets less current liabilities) of $9,556,801;
  • Currently engaged in the processing of its stock of dried cannabis biomass into various extracts including distilled and winterized oils, kief, and additional extracted products for sale to other Licensed Producers;
  • Sales in the quarter were primarily derived from distillate and kief as production continued to ramp up for both product lines;
  • The gross margin percentage for the three-month period was 59% before fair value adjustment. In the comparative period, the Company was not in a revenue-generating position; and
  • ​​On October 26, 2021, the Company successfully completed harvesting its second crop which has already proven to be a higher yield than the inaugural crop with better quality biomass through enhanced harvesting techniques.

Joel Dumaresq, Chief Executive Officer and Director of Christina Lake Cannabis commented, “This was a productive quarter for the Company as we continued our revenue growth with the support of steady demand for our cannabis extracts. The needs of Licensed Producers have become increasingly sophisticated as product offerings under ‘Cannabis 2.0’ are creating greater demand for both medicinal and recreational use cases. Under CLC’s commercial sales leadership, we’ve been able to align a healthy supply of distillate oils and kief with the needs of a diverse base of Licensed Producer accounts across Canada. Now that our 2021 crop has been completely harvested, our second growing season has proven to have a greater yield than the inaugural crop with a higher quality of biomass that can be attributed to advanced harvesting techniques.”

Christina Lake Cannabis Fiscal Q3 2021 Financial Summary

    Three months ended Nine months ended
Three and nine months period ended, Notes August 31,
2021
$
August 31,
2020
$
August 31,
2021
$
August 31,
2020
$
           
Revenue          
Revenue from sale of goods     1,290,722         1,569,881      
Cost of sales     (532,428 )       (623,933 )    
Gross profit before fair value adjustments   758,294         945,948      
           
Changes in fair value of inventory sold     (742,593 )       (918,074 )    
Gross profit from sale of goods     15,701         27,874      
           
Fair value change on growth of biological asset   5,430,173     3,046,237     5,430,173     3,046,237  
           
General and administrative expenses          
Accretion 8,9,11   188,880     79,129     382,214     134,989  
Consulting fees 12   122,133     343,973     328,733     450,367  
Communication expense     1,975         69,021      
Corporate development             365,872      
Depreciation 4   77,080     7,166     381,028     14,331  
Foreign exchange     (4 )       (451 )    
Interest expense 9   182,066     109,189     452,711     176,902  
Insurance     21,478     10,088     62,370     30,422  
Management fees 12   36,000         108,000      
Marketing     1,574         403,884      
Nursery expenses     30,156     (73,385 )   36,864     65,466  
Office and miscellaneous     49,589     50,227     229,784     236,653  
Professional fees     240,963     106,941     398,095     222,266  
Property taxes             30,566     25,144  
Salaries 12   318,237     145,431     1,037,998     652,711  
Share based compensation 12,13   372,531     1,272,522     924,935     1,429,777  
Repairs and maintenance     17,475         35,579      
Regulatory fees     5,898     117,193     84,155     155,205  
Total general and administrative expenses     (1,666,031 )   (2,168,474 )   (5,331,358 )   (3,594.233 )
           
Other items          
Accounts payable write down             (38,528 )   32,817  
Fair value preferred shares 13           510,521      
Loss on sale of equipment             4,900      
Total other items             (476,893 )    
           
Net and comprehensive income (loss) for the period

$

3,779,843

 

$

877,763

  $ (350,204 ) $ (515,179 )
Gain (loss) per share – basic and diluted   $ 0.03   $ 0.01   $ (0.00 ) $ (0.01 )
Weighted average number of common shares outstanding     112,607,372     81,004,447     105,639,215     78,071,770  

Notable Business Updates

Attaining Key Benchmark of Tetrahydrocannabinol (“THC”) Concentration

In a press release dated June 29, 2021, the Company announced that its distillate oils had attained an average THC concentration of 90.4%, a threshold considered to be desirable in the cannabis industry. With high-concentration distillate oils, Licensed Producers can manufacture a wide variety of goods in categories to include food and beverage, personal care, vaping, and medicinal products.

Performance of Experimental Cannabis Strains Under Natural Sunlight

In addition to the Company’s seven “proven” cannabis strains comprising the majority of its 2021 crop, more than 90 “experimental” strains have also progressed to the outdoor testing phase and performed exceptionally when grown under natural sunlight. The Company intends to incorporate certain “experimental” strains grown outdoors this year into its strain selection for the 2022 growing season.

About Christina Lake Cannabis Corp.

Christina Lake Cannabis Corp. is a licensed producer of cannabis under the Cannabis Act. It has secured a standard cultivation licence and corresponding processing/sales amendment from Health Canada (March 2020 and August 2020, respectively) as well as a research and development licence (early 2020). CLC’s facility consists of a 32-acre property, which includes over 950,000 square feet of outdoor grow space, offices, propagation and drying rooms, research facilities, and a facility dedicated to processing and extraction. CLC also owns a 99-acre plot of land adjoining its principal 32-acre site, which enables the Company to grow at a much larger scale. CLC cultivates cannabis using strains specifically developed for outdoor cultivation and in its inaugural harvest year produced 32,500 kg (71,650 lb) on its existing facility before developing an adjacent 99-acre expansion property. Such an expansion will ultimately bring CLC’s annual cultivation footprint to over 4.35 million square feet, which could enable at least 150,000 kg (330,693 lb) of low-cost, high-quality, sun-grown cannabis to be produced annually by the Company.

On behalf of Christina Lake Cannabis Corp.:

“Joel Dumaresq”

Joel Dumaresq, CEO and Director

For more information about CLC, please visit: www.christinalakecannabis.com

Jamie Frawley
Investor Relations and Media Inquiries
jamie@clcannabis.com
416-268-9432

THE CANADIAN SECURITIES EXCHANGE (“CSE”) HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE, NOR HAS OR DOES THE CSE’S REGULATION SERVICES PROVIDER.

Forward-Looking Information: This news release includes certain statements that may be deemed “forward-looking statements.” The use of any of the words “anticipate,” “continue,” “estimate,” “expect,” “may,” “will,” “would,” “project,” “should,” “believe” and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. These statements speak only as of the date of this News Release. Actual results could differ materially from those currently anticipated due to a number of factors and risks including various risk factors discussed in the Company’s disclosure documents which can be found under the Company’s profile on http://www.sedar.com.

Statement Regarding Third-Party Investor Relations Firms

Disclosures relating to investor relations firms retained by Christina Lake Cannabis Corp. can be found under the Company’s profile on http://sedar.com.

LEAVE A REPLY

Please enter your comment!
Please enter your name here