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Nutrien’s First Quarter Impacted by Harsh Weather; Maintains Guidance

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All amounts are in US dollars

SASKATOON, Saskatchewan–(BUSINESS WIRE)–Nutrien Ltd. (Nutrien) announced today its 2019 first-quarter results,
with net earnings from continuing operations of $41 million ($0.07
diluted earnings per share). First-quarter adjusted net earnings was
$0.20 per share and adjusted EBITDA was $697 million.
Adjusted net earnings (total and per share amounts), adjusted EBITDA and
related annual guidance are non-IFRS financial measures. See pages 2 and
15 for further information.

Nutrien’s first-quarter adjusted EBITDA was 22 percent higher than 2018
despite being impacted by the second wettest six-month period in the US
in 125 years. While some regions are still receiving excess moisture,
planting is underway and we expect strong crop input demand in the
second quarter. As such, we are maintaining our annual guidance for
2019,” commented Chuck Magro, Nutrien’s President and CEO.

Our organization is focused on what it can control and how best to
deliver long-term value to stakeholders. In the first quarter, we
allocated almost $1 billion towards growing our Retail business in core
markets and repurchased over $800 million of our stock. We also continue
to pursue operational enhancements across our world-class integrated
network and to lead the way in digital transformation of the ag-retail
industry,” added Mr. Magro.

Highlights:

  • Retail EBITDA in the first quarter was lower compared to the same
    period last year due to an extremely wet spring season and flooding in
    parts of the US. Continued progress was made on Nutrien Ag Solutions
    digital platform, with customers representing 58 percent of our North
    American Retail sales signed up on the platform within nine months of
    launch.
  • Potash EBITDA was 41 percent higher in the first quarter compared to
    the same period last year due to higher net selling prices and strong
    offshore demand, partially offset by lower North American sales.
  • Nitrogen EBITDA in the first quarter was slightly higher than the same
    period last year due mainly to higher urea and UAN prices being offset
    by lower total sales volumes resulting from the excess wet weather
    across the US.
  • We strengthened our US Retail business including the acquisitions of
    Actagro, LLC, Van Horn, Inc., and Security Seed and Chemical, Inc.,
    and completing the remainder of the Agrichem acquisition in Brazil
    with combined annual revenue of approximately $400 million for these
    businesses. We also entered into a binding agreement to acquire
    Ruralco Holdings Limited, the third largest agriculture retailer in
    Australia.
  • Nutrien achieved $621 million in annual run-rate synergies as at March
    31, 2019, surpassing the target of $600 million for the end of 2019.
    This represents a 24 percent increase from the original target of $500
    million and was achieved well ahead of schedule.
  • Nutrien announced an additional five percent normal course issuer bid
    program in February 2019 and to date, has repurchased approximately 21
    million shares representing over 3 percent of Nutrien’s outstanding
    shares.
  • Nutrien full-year 2019 adjusted net earnings per share and adjusted
    EBITDA guidance is maintained at $2.80 to $3.20 per share and $4.4
    billion to $4.9 billion, respectively. First-half 2019 guidance is
    provided at $1.75 to $1.95 adjusted net earnings per share.
  • We have provided a new financial data tool on our website, allowing
    stakeholders to view our historical annual and quarterly information
    in an easy to use and downloadable format. It is located at: https://www.nutrien.com/interactive-datatool

Adjusted Net Earnings

  Three Months Ended March 31, 2019
Dollars (millions), except per share amounts   Increases

(Decreases)

  Post-Tax   Per

Diluted Share

Net earnings   $ 41   $ 0.07
Adjustments:
Merger and related costs $ 11 8 0.02
Share-based compensation 57 44 0.07
Impairment     33     25     0.04
Adjusted net earnings         $ 118   $ 0.20

Management’s Discussion and Analysis

The following management’s discussion and analysis (MD&A) is the
responsibility of management and dated as of May 9, 2019. The Board of
Directors (Board) of Nutrien carries out its responsibility for review
of this disclosure principally through its audit committee, comprised
exclusively of independent directors. The audit committee reviews and,
prior to its publication approves this disclosure pursuant to the
authority delegated to it by the Board. The term “Nutrien” refers to
Nutrien Ltd. and the terms “we,” “us,” “our,” “Nutrien” and “the
Company” refer to Nutrien and, as applicable, Nutrien and its direct and
indirect subsidiaries as a group. Additional information relating to
Nutrien (which, except as otherwise noted, is not incorporated by
reference herein), including our 2018 Annual Report dated February 20,
2019, which includes our consolidated financial statements and
management’s discussion and analysis and our Annual Information Form,
each for the year ended December 31, 2018, can be found on SEDAR at www.sedar.com
and on EDGAR at www.sec.gov.
The Company is a foreign private issuer under the rules and regulations
of the US Securities and Exchange Commission (the SEC).

This MD&A is based on the Company’s unaudited interim condensed
consolidated financial statements as at and for the three months ended
March 31, 2019 (interim financial statements) prepared in accordance
with International Financial Reporting Standards as issued by the
International Accounting Standards Board (IFRS) and prepared in
accordance with International Accounting Standard 34 “Interim Financial
Reporting” unless otherwise stated. It contains certain non-IFRS
financial measures and forward-looking statements which are described in
the “Non-IFRS Financial Measures” section which begins on page 15 and
the “Forward-Looking Statements” section on page 12 respectively. For
the definitions of financial and non-financial terms used in this MD&A,
as well as a list of abbreviated company names and sources, see pages
87, 157 and 158 of our 2018 Annual Report. All references to per share
amounts pertain to diluted net earnings (loss) per share and all
financial data are stated in millions of US dollars unless otherwise
noted.

Market Outlook

Agriculture and Retail

  • Trade disruptions continue to impact North American growers. US
    soybean exports to China are down 55 percent year-over-year, while
    China has also placed import restrictions on two of Canada’s largest
    canola exporters.
  • Unfavorable weather in the US since the fourth quarter of 2018 has
    narrowed the application window. However, the US Department of
    Agriculture (USDA) projects corn plantings will reach nearly 93
    million acres, which would be the highest since 2016 and favorable for
    nutrient demand, seed expenditures and custom application services.
  • We expect a two to four percent increase in North American crop
    protection expenditures in 2019 due to higher corn acreage and
    increased weed pressure this year given the limited ability for
    growers to use post-harvest applications last fall.
  • Seed expenditures are also expected to be supported by increased corn
    acreage in the US.

Crop Nutrient Markets

  • Global potash market fundamentals have remained strong, as suppliers
    are comfortably sold forward in 2019 and Canpotex is fully committed
    until June. We maintain our forecast that 2019 deliveries will be
    between 67 and 69 million tonnes, underpinned by good affordability in
    the US and most key offshore markets, particularly in Brazil and
    China. While weak palm oil prices are a headwind for demand in
    Southeast Asia, we believe the downside risks are relatively limited
    as potash is applied on a wide range of crops in the region.
  • We expect strong nitrogen demand to emerge in the second quarter of
    2019 from the US, Europe and Latin America. In the US, we expect
    overall nitrogen demand will be at historically strong levels in the
    second and third quarter with some weather-related product mix shift
    towards urea and UAN as opposed to ammonia. In recent weeks, this has
    led to NOLA urea prices increasing by almost $50 per tonne from
    February lows.
  • Slow global demand and lower input costs pressured phosphate prices
    over the past quarter, although we expect some support from an
    improvement in demand in Latin America, India and the US in the second
    quarter.

Financial Outlook and Guidance

Based on the market factors detailed above, we are maintaining 2019
adjusted net earnings guidance of $2.80 to $3.20 per share and adjusted
EBITDA guidance of $4.4 billion to $4.9 billion. First-half 2019
guidance is provided at $1.75 to $1.95 adjusted net earnings per share.

As the 2019 guidance has not changed, all related assumptions and
sensitivities can be found on page 62 of Nutrien’s 2018 Annual Report.

All guidance numbers, including those noted above, are outlined in the
table below:

2019 Guidance Ranges 1     Low     High  
Adjusted net earnings per share 2     $ 2.80   $ 3.20
Adjusted first-half net earnings per share 2 $

1.75

$

1.95

Adjusted EBITDA (billions) 2 $ 4.40 $ 4.90
Retail EBITDA (billions) $ 1.30 $ 1.40
Potash EBITDA (billions) $ 1.80 $ 2.00
Nitrogen EBITDA (billions) $ 1.30 $ 1.50
Phosphate EBITDA (billions) $ 0.20 $ 0.30
Potash sales tonnes (millions) 3 13.0 13.4
Nitrogen sales tonnes (millions) 3 10.6 11.0
Depreciation and amortization (billions) $ 1.80 $ 1.90
Merger and related costs (millions) $ 50 $ 75
Effective tax rate on continuing operations 24 % 26 %
Sustaining capital expenditures (billions)     $ 1.00     $ 1.10  

1 See Forward-Looking Statements section starting on page 12.
2
See Non-IFRS Financial Measures section starting on page 15.

3
Manufactured products only. Nitrogen excludes ESN® and Rainbow products.

Consolidated Results

  Three months ended March 31  

(millions of US dollars)

  2019   2018     % Change  
Sales 1 $ 3,691 $ 3,666     1
Freight, transportation and distribution (171 ) (208 ) (18 )
Cost of goods sold 1 (2,545 ) (2,611 ) (3 )
Gross margin 975 847 15
Expenses (799 ) (771 ) 4
Net earnings (loss) 41 (1 ) n/m
EBITDA 2 596 487 22
Adjusted EBITDA 2     697     569       22  

1 Certain immaterial figures have been reclassified or grouped
together for the three months ended March 31, 2018.

2
See Non-IFRS Financial Measures section starting on page 15.

n/m
= Not meaningful

  • Nutrien’s first-quarter net earnings were up from the loss in the
    first quarter of 2018, supported by higher global nutrient prices,
    strong operational results and the continued benefit of synergy
    realization. Partially offsetting this was lower overall sales volumes
    of nutrients and lower Retail earnings related to the extremely wet
    weather in the US and dry conditions in Australia.

Segment Results

In the first quarter of 2019, our Executive Leadership Team reassessed
our product groupings and decided to evaluate the performance of
ammonium sulfate as part of the Nitrogen segment, rather than the
Phosphate and Sulfate segment as reported in 2018. Effective January 1,
2019, we have four reportable operating segments: Retail, Potash,
Nitrogen and Phosphate. Comparative amounts presented on a segmented
basis have been restated accordingly. We also renamed our “Others”
segment to “Corporate and Others”.

Detailed descriptions of our operating segments can be found in our 2018
Annual Report on pages 32-35 (Retail), 39-41 (Potash), 45-47 (Nitrogen)
and 51-53 (Phosphate).

Our discussion of segment results set out on the following pages is a
comparison of our first quarter 2019 results to our first quarter 2018
results unless otherwise noted.

Retail

  Three months ended March 31
Dollars (millions)         Gross Margin Dollars (millions)       Gross Margin (%)
    2019   2018   % Change   2019   2018   % Change   2019   2018
Sales              
Crop nutrients 1 $ 687 $ 684 $ 131 $ 123 7 19 18
Crop protection products 744 774 (4 ) 117 128 (9 ) 16 17
Seed 356 341 4 50 44 14 14 13
Merchandise 2 108 120 (10 ) 19 23 (17 ) 18 19
Services and other     144     151     (5 )   92     90     2     64     60
2,039 2,070 (1 ) $ 409 $ 408 20 20
Cost of goods sold 2     (1,630 )   (1,662 )   (2 )
Gross margin 409 408
Expenses 3     (571 )   (541 )   6  
Earnings before finance

costs and taxes (EBIT)

(162 ) (133 ) 22
Depreciation and amortization     136     123     11  
EBITDA   $ (26 ) $ (10 )   160  

1 Includes intersegment sales. See Note 2 to the interim financial
statements.

2 Certain immaterial figures have been
reclassified or grouped together for the three months ended March 31,
2018.

3 Includes selling expenses of $532 million (2018
– $523 million).

  • Retail EBITDA was lower as planting and applications were
    delayed by extreme wet weather across the US and dryness in Australia.
    Sales of crop protection, crop nutrients and associated application
    services were most notably affected; however, higher crop nutrient
    prices and margins helped partly offset the effects of the postponed
    applications. Total gross margin percentage remained flat compared to
    the same period last year.
  • Crop nutrients sales were flat as higher sales prices were
    offset by lower sales volumes. Gross margin increased primarily
    because of higher selling prices.
  • Crop protection products sales were lower as adverse US and
    Australian weather impacted herbicide applications. Gross margin
    percentage decreased due to a combination of higher competition
    related to elevated inventories, and higher costs of raw materials
    sourced from China.
  • Seed sales and gross margin percentage increased slightly
    compared to the same quarter in 2018 as US growers look to plant
    higher corn acreage than soybeans in 2019. Proprietary seed gross
    margins are up across all geographies resulting in favorable product
    mix and improved overall gross margin.
  • Merchandise sales declined as a result of lower equipment sales
    in the Canadian operations to focus more on core Retail products.
  • Services and other sales were down due to lower livestock
    export shipments and wool commissions in Australia and the delayed
    start to the spring application season across the US. The sales mix
    change resulted in a higher gross margin percentage compared to the
    same period in 2018.

Potash

  Three months ended March 31  
Dollars (millions)       Tonnes (thousands)       Average per Tonne  
    2019   2018   %

Change

  2019   2018   %

Change

  2019   2018   %

Change

 
Manufactured product 1              
Net sales
North America $ 245 $ 250 (2 ) 976 1,254 (22 ) $ 250 $ 199 26
Offshore     451     324     39     1,944     1,871     4     232     173     34  
696 574 21 2,920 3,125 (7 ) 238 184 29
Cost of goods sold     (272 )   (279 )   (3 )                     (93 )   (90 )   3  
Gross margin 424 295 44 145 94 54
Other 2     1           Depreciation and amortization         34     29     17  
Gross margin 425 295 44 Gross margin excluding
Expenses 3     (64 )   (58 )   10   depreciation and amortization 4         179     123     46  
EBIT 361 237 52 Cash cost of product
Depreciation and amortization     100     91     10   manufactured 4         58     61     (5 )
EBITDA   $ 461   $ 328     41  

1 Includes intersegment sales. See Note 2 to the interim financial
statements.

2 Includes other potash and purchased
products and is comprised of net sales of $1 million (2018 – $1 million)
less cost of goods sold of $Nil (2018 – $1 million).

3
Includes provincial mining and other taxes of $63 million (2018 – $48
million).

4 See Non-IFRS Financial Measures section
starting on page 15.

  • EBITDA increased significantly due to a combination of higher
    global potash prices and strong offshore sales volumes, partially
    offset by lower domestic demand related to extremely wet weather in
    the US which impacted fertilizer applications both this spring and
    last fall.
  • Sales volumes were down as strong demand in offshore markets
    only partially offset weather-related lower sales volumes in the US.
    Canpotex Limited (Canpotex) shipped record volumes in the first
    quarter of 2019 and recently announced that it is fully committed
    until June 2019. North American potash deliveries were slow due to the
    late start to the spring season compounded by high retail inventories
    as a result of the short fall application season.
  • Net realized selling price increased due to strong global
    demand and tight supply.
  • Cost of goods sold per tonne was slightly higher due to higher
    depreciation and amortization. Cash cost of product manufactured was
    $58 per tonne in the first quarter, down 5 percent from the same
    quarter in 2018.

Canpotex Sales by Market

  Three months ended March 31  
(percentage of sales volumes)   2019   2018   % Change  
Other Asian markets 1   33     29     14
China 30 32 (6 )
Latin America 19 21 (10 )
India 10 6 67
Other markets     8     12     (33 )
      100     100        

1 All Asian markets except China and India.

Nitrogen

  Three months ended March 31  
Dollars (millions)       Tonnes (thousands)       Average per Tonne  
    2019   2018 1   %

Change

  2019   2018 1   %

Change

  2019   2018 1   %

Change

 
Manufactured product 2              
Net sales
Ammonia $ 162 $ 208 (22 ) 644 744 (13 ) $ 252 $ 280 (10 )
Urea 213 212 647 724 (11 ) 330 294 12
Solutions, nitrates and

sulfates

    171     155     10     948     907     5     180     170     6  
546 575 (5 ) 2,239 2,375 (6 ) 244 242 1
Cost of goods sold     (398 )   (438 )   (9 )                     (178 )   (184 )   (3 )
Gross margin 148 137 8 66 58 14
Other 3     18     16     13   Depreciation and amortization         50     56     (11 )
Gross margin 166 153 8 Gross margin excluding
Expenses     (5 )   (16 )   (69 ) depreciation and amortization         116     114     2  
EBIT 161 137 18 Urea controllable cash cost of
Depreciation and amortization     113     134     (16 ) product manufactured 4         74     69     7  
EBITDA   $ 274   $ 271     1  

1 Restated for the reclassification of sulfate from the Phosphate
segment. See page 4 of this document and Note 2 to the interim financial
statements.

2 Includes intersegment sales. See Note 2
to the interim financial statements.

3 Includes other
nitrogen (including ESN® and Rainbow) and purchased products and is
comprised of net sales of $131 million (2018 – $120 million) less cost
of goods sold of $113 million (2018 – $104 million).

4
See Non-IFRS Financial Measures section starting on page 15.

  • EBITDA increased slightly as a result of higher urea, UAN and
    sulfate sales prices, primarily offset by lower nitrogen sales volumes
    due to delayed applications in the US.
  • Sales volumes for nitrogen decreased due to lower ammonia and
    urea sales volumes, associated with wet weather in key US regions that
    delayed nitrogen applications.
  • Net realized selling price of nitrogen increased as higher
    average prices for urea, UAN, and sulfates more than offset lower
    prices for ammonia. Ammonia prices declined as a result of weak demand
    for this product due to poor application conditions since the fourth
    quarter of 2018, which provided support for alternative nitrogen
    products such as urea.
  • Cost of goods sold per tonne of nitrogen decreased overall due
    to lower depreciation and amortization more than offsetting increased
    costs from lower operating rates. As a result, urea controllable cash
    cost of product manufactured increased by $5 per tonne.

Natural Gas Prices

  Three months ended March 31  
(Dollars per MMBtu)   2019   2018   % Change  
Overall gas cost excluding realized derivative impact $ 2.98   $ 2.73     9
Realized derivative impact     0.05     0.29     (83 )
Overall gas cost   $ 3.03   $ 3.02      
 
Average NYMEX $ 3.15 $ 3.00 5
Average AECO     1.47     1.48     (1 )
  • Gas costs were similar to the same quarter in 2018 as lower
    realized derivative losses offset higher gas prices in Trinidad and
    the US.

Phosphate

  Three months ended March 31  
Dollars (millions)       Tonnes (thousands)       Average per Tonne  
    2019   2018 1   %

Change

  2019   2018 1   %

Change

  2019   2018 1   %

Change

 
Manufactured product 2              
Net sales
Fertilizer $ 208 $ 240 (13 ) 491 605 (19 ) $ 423 $ 396 7
Industrial and feed     111     106     5     204     221     (8 )   545     481     13  
319 346 (8 ) 695 826 (16 ) 459 419 10
Cost of goods sold     (304 )   (322 )   (6 )                     (437 )   (390 )   12  
Gross margin 15 24 (38 ) 22 29 (24 )
Other 3     (1 )         Depreciation and amortization         86     56     54  
Gross margin 14 24 (42 ) Gross margin excluding
Expenses     (6 )   (6 )     depreciation and amortization         108     85     27  
EBIT 8 18 (56 )
Depreciation and amortization     60     46     30  
EBITDA   $ 68   $ 64     6  

1 Restated for the reclassification of sulfate to the Nitrogen
segment. See page 4 of this document and Note 2 to the interim financial
statements.

2 Includes intersegment sales. See Note 2 to
the interim financial statements.

3 Includes other
phosphate and purchased products and is comprised of net sales of $30
million (2018 – $35 million) less cost of goods sold of $31 million
(2018 – $35 million)

  • EBITDA increased due to higher realized prices. This was
    partially offset by the impact of higher cost of goods sold per tonne.
  • Sales volumes decreased as wet weather in the US delayed the
    application season and lower demand from India impacted export volumes.
  • Net realized selling price increased for the majority of our
    phosphate products, even though phosphate benchmark prices declined.
    This is due to first quarter presold phosphate sales at higher
    benchmark prices and the settlement of new industrial contracts.
  • Cost of goods sold per tonne increased due to higher
    depreciation and amortization in 2019 and because the first quarter of
    2018 benefited from asset retirement obligation adjustments.

Expenses & Income Below Gross Margin

Three months ended March 31  
Dollars (millions), except percentage amounts 2019   2018   % Change  
Selling expenses 1 $ (538 ) $ (532 )   1
General and administrative expenses 2 (95 ) (103 ) (8 )
Provincial mining and other taxes 3 (65 ) (48 ) 35
Share-based compensation expenses (57 ) (16 ) 256
Other expenses (44 ) (72 ) (39 )
Finance costs (123 ) (119 ) 3
Income tax (expense) recovery (12 ) 42 n/m
Other comprehensive income (loss)   32     (70 ) n/m  

1 Expenses are primarily in the Retail segment. See page 4 for
analysis.

2 Includes expenses of $64 million (2018 – $68
million) in the Corporate and Others segment.

3 Expenses
are primarily in the Potash segment. See page 5 for analysis.

n/m
= not meaningful

  • Share-based compensation expenses increased due to improved
    performance towards vesting conditions and a higher Nutrien share
    price.
  • Other expenses decreased primarily due to lower costs
    associated with the merger of Potash Corporation of Saskatchewan Inc.
    and Agrium Inc. (Merger) more than offsetting the $33 million
    impairment of our intangible assets as a result of Fertilizantes
    Heringer S.A. filing for bankruptcy protection in the first quarter of
    2019.
  • Income tax (expense) recovery changed as we had earnings before
    income taxes for the three months ended March 31, 2019 compared to a
    loss before income taxes for the same period in 2018. In addition,
    discrete tax adjustments increased tax expense by $15 million for the
    three months ended March 31, 2019 compared to a discrete tax recovery
    of $3 million for the same period in 2018. As a result, an income tax
    expense was realized for the three months ended March 31, 2019 as
    compared to an income tax recovery for the same period last year.
  • Other comprehensive income (loss) was impacted primarily by
    unrealized gains in our investment in Sinofert Holdings Limited
    (Sinofert) compared to unrealized losses in Sinofert and a realized
    loss in Israel Chemicals Ltd. (ICL) in the comparative quarter, as
    well as a gain on translation of our operations in Canada and
    Australia compared to a loss on translation of those operations in the
    same period in 2018 due to decreases in the value of the Canadian
    dollar and Australian dollar relative to the US dollar.

Financial Condition Review

The following balance sheet categories contained variances that were
considered significant:

As at      
Assets March 31,

2019

  December 31,

2018

  $

Variance

  %

Change

 
Cash and cash equivalents $ 373   $ 2,314   (1,941 ) (84 )
Inventories 6,560 4,917 1,643 33
Prepaid expenses and other current assets 688 1,089 (401 ) (37 )
Property, plant and equipment 19,834 18,796 1,038 6
Goodwill   11,817     11,431     386     3  
 
Liabilities and Equity                        
Short-term debt $ 1,652 $ 629 1,023 163
Current portion of long-term debt 1,197 1,003 194 19
Payables and accrued charges 6,602 6,703 (101 ) (2 )
Long-term debt 7,917 7,591 326 4
Share capital 16,316 16,740 (424 ) (3 )
Retained earnings   7,405     7,745     (340 )   (4 )

Contacts

Investor and Media Relations:
Richard Downey
Vice
President, Investor & Corporate Relations
(403) 225-7357
[email protected]

Investor Relations:
Jeff Holzman
Senior Director,
Investor Relations
(306) 933-8545

Todd Coakwell
Director, Investor Relations
(403) 225-7437

Contact us at: www.nutrien.com

Selected financial data for download can be found in our data tool at https://www.nutrien.com/interactive-datatool
Such
data is not incorporated by reference herein.

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Cannabis

4D Printing in Healthcare Market is Valued at USD 179.7 Million by 2034 with CAGR of 30.7%, Innovating Patient Care with Dynamic Prototyping – By PMI

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Announces

IMC Announces Potential Reverse Merger with Kadimastem a leading Clinical cell therapy company

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Not for distribution to United States newswire services or for dissemination in the United States

TORONTO and GLIL YAM, Israel, Feb. 28, 2024 /PRNewswire/ — IM Cannabis Corp. (CSE: IMCC) (NASDAQ: IMCC) (the “Company” or “IMC“), a leading medical cannabis company with operations in Israel and Germany, is pleased to announce that it has entered into a non-binding term sheet dated February 13, 2024, as amended (the “Term Sheet“), and a Loan Agreement (as defined below) with Holding Company (as defined below), with Israel-based Kadimastem Ltd a clinical cell therapy public company traded on the Tel Aviv Stock Exchange under the symbol (TASE: KDST) (“Kadimastem“), whereby the parties will complete a business combination that will constitute a reverse merger into the Company by Kadimastem (the “Proposed Transaction“).

 

 

We have been looking for a way to deliver maximum value for our shareholders in the current situation and believe that a reverse merger with Kadimastem will provide this,” said Oren Shuster, CEO of IMC. “With its focus on clinical stage cell therapy, and an FDA approval for a Phase IIa clinical trial, we believe that Kadimastem has tremendous potential.”

“Kadimastem’s strategic decision to pursue a NASDAQ listing underscores our commitment to maximizing the potential of our diabetes and ALS product candidates,” said Ronen Twito, Kadimastem’s Executive Chairman of the Board. “This move positions us closer to our target markets in the US, leverages our recent FDA approvals to initiate a Phase IIa multi-site clinical trial in the US for our ALS product candidate and the joint development of a diabetes product with our Florida-based partner, a multi-billion dollar market. We strongly believe this comprehensive strategy will create significant value to the company’s shareholders”.

The Proposed Transaction

The Proposed Transaction will be effected by way of a plan of arrangement involving a newly created wholly-owned subsidiary of IMC and Kadimastem (the “Arrangement“). The resulting issuer that will exist upon completion of the Proposed Transaction (the “Resulting Issuer“) will change its business from medical cannabis to biotechnology and, at the closing of the Proposed Transactions (the “Closing”), Kadimastem  shareholders will hold 88% of the common shares of the Resulting Issuer (the “Resulting Issuer Shares“) and the shareholders of the Company will hold 12% of the Resulting Issuer Share. Parties may agree, in the Definitive Agreement, on a different structure of equity in lieu of the warrants (as described below) with a similar result. The Proposed Transaction is an arm’s length transaction.

Prior to Closing, IMC’s existing medical cannabis operation and other current activities in Israel and Germany (the “Legacy Business“) will be restructured (the “Spin-Out“) as a contingent value right (the “CVR“). The CVR will entitle the holders thereof to receive net cash, equity, or other net value upon the sale of the Legacy Business following the Closing, subject to the terms of the Loan Agreement.

To facilitate the sale of the Legacy Business, a special committee of IMC’s Board of Directors was formed, which will oversee the potential sale in collaboration with legal and financial advisors.

The Legacy Business will be made available for potential sale to a third party for a period of up to 12 months from Closing (the “Record Date“). After the Record Date, any remaining Legacy Business in the CVR will be offered for sale through a tender process, subject to the terms of the best offer. The proceeds from the sale of the Legacy Business will be utilized to settle debts and distribute the remaining balance, if any, to CVR holders.

As a condition of Closing, Kadimastem will have approximately $5 million in gross funds, at Closing including capital raised concurrently with the completion of the Proposed Transaction from existing shareholders and additional investors.

In addition to the foregoing, subject to compliance with applicable law, the Company shall grant shareholders of the Company as of Closing, with warrant(s) equal their pro rata portion, of 2% of the Resulting Issuer’s issued and outstanding common share capital (the “IMC Shares“) prior to the Closing Date (in the aggregate), with an exercise price per share equal to the 10 day volume-weighted average price of the Resulting Issuer’s shares calculated on the NASDAQ Capital Market (“Nasdaq“), ending 2 trading days prior to Closing, the warrants will be for a period of 24 months following Closing.

Description of Kadimastem and its Business

Kadimastem is a clinical stage cell therapy company, Kadimastem’s recently reported receipt of FDA approval for a Phase IIa multi-site clinical trial in the US for the treatment of ALS, and the joint development agreement signed with iTolerance Inc., a Florida based company with a product in the field of diabetes which recently have a successful joint INTERCT meeting with the FDA.

Exchange of Securities

In accordance with the terms of the Proposed Transaction, the holders of the issued and outstanding shares in the capital of Kadimastem (the “Kadimastem Shares“) will be issued such number of IMC Shares in exchange for every one (1) Kadimastem Share held immediately prior to the completion of the Proposed Transaction that reflects the ratio outlined above (the “Exchange Ratio“). Outstanding convertible securities of Kadimastem (the “Kadimastem Convertible Securities“) will be treated through customary mechanics as shall be determined in the definitive agreement, which may include, the assumption of the Kadimastem Convertible Securities by IMC subject to customary adjustments to reflect the Exchange Ratio and exercise price.

Loan Agreement

Pursuant to the terms of the Term Sheet, a loan agreement dated February 28, 2024 (the “Loan Agreement“) was entered between IMC Holdings Ltd. a wholly-owned subsidiary of IMC (the “Holding Company“) and Kadimastem. Pursuant to the Loan Agreement, Kadimastem will provide a loan of up to US$650,000 to the Holding Company, funded in two installments: US$300,000 upon signing the Loan Agreement and US$350,000 upon the execution of the definitive agreement regarding the Proposed Transaction (the “Loan“).

The Loan accrues interest at a rate of 9.00% per annum, compounding annually and is secured by the following collaterals and guarantees: (a) 10% of the proceeds derived from any operation sale under the CVR (“Charged Rights”), limited to the outstanding Loan Amount and expenses according to the Loan Agreement, accordingly Holding Company may, at its sole discretion, to record a second-ranked fixed charge over the Charged Rights or, alternatively, in case the existing pledges over the Charged Rights at the date of signing this Loan Agreement are subsequently discharged or removed, then the Borrower shall promptly record a first-ranking fixed charge over the Charged Assets with all applicable public records; provided that Holding Company shall not impose any new lien, mortgage, charge or pledge over the Charged Rights that did not exist on the date hereof, or any other liens, subject to customary exclusions; (b) the Holding Company shall use its best efforts to record a first-ranking fixed charge over the assets of its subsidiary, A.R Yarok Pharm Ltd, in due course when applicable and as deemed appropriate; and (c) a personal guarantee by Mr. Oren Shuster, IMC’s CEO.

IMC Shareholder Meeting

Prior to the completion of the Proposed Transaction, IMC will call a meeting of its shareholders for the purpose of approving, among other matters:

  • approve the Proposed Transaction;
  • approve the Spin-Out;
  • a change of name of the Company as directed by Kadimastem and acceptable to the applicable regulatory authorities effective upon Closing; and
  • reconstitution of the Company’s board of directors.

Management of the Resulting Issuer

Upon closing of the Proposed Transaction, all of IMC’s current directors and executive officers will resign and the board of directors of the Resulting Issuer will, subject to the approval of governing regulatory bodies, consist of nominees of Kadimastem. All of the executive officers shall be replaced by nominees of Kadimastem, all in a manner that complies with the requirements of governing regulatory bodies and applicable securities and corporate laws.

Details of insiders and proposed directors and officers of the Resulting Issuer will be disclosed in a further news release.

Closing Conditions

The completion of the Proposed Transaction is subject to a number of conditions, including but not limited to the following:

  • the execution of a definitive agreement;
  • completion of mutually satisfactory due diligence;
  • completion of the Share Consolidation; and
  • receipt of all required regulatory, corporate and third party approvals, including approvals by governing regulatory bodies, the shareholders of IMC and Kadimastem, applicable Israeli governmental authorities, and the fulfilment of all applicable regulatory requirements and conditions necessary to complete the Proposed Transaction.

The parties are committed to seeking a successful completion of the Proposed Transaction as soon as practicable, but there can be no absolute certainty that the Proposed Transaction will take place.

Further information

Further details about the Proposed Transaction and the Resulting Issuer will be provided in a comprehensive news release when the parties enter into the definitive agreement.

Investors are cautioned that any information released or received with respect to the Proposed Transaction in this press release may not be complete and should not be relied upon. Trading in the common shares of the Company should be considered highly speculative.

The securities to be issued in connection with the Proposed Transaction have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined in Regulation S promulgated under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, Canadian Securities Exchange (“CSE”) and NASDAQ acceptance and if applicable, disinterested shareholder approval. Where applicable, the Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon

About IM Cannabis Corp.

IMC (Nasdaq: IMCC) (CSE: IMCC) is an international cannabis company that provides premium cannabis products to medical patients in Israel and Germany, two of the largest medical cannabis markets. The Company has recently exited operations in Canada to pivot its focus and resources to achieve sustainable and profitable growth in its highest value markets, Israel and Germany. The Company leverages a transnational ecosystem powered by a unique data-driven approach and a globally sourced product supply chain. With an unwavering commitment to responsible growth and compliance with the strictest regulatory environments, the Company strives to amplify its commercial and brand power to become a global high-quality cannabis player.

The IMC ecosystem operates in Israel through its commercial relationship with Focus Medical Herbs Ltd., which imports and distributes cannabis to medical patients, leveraging years of proprietary data and patient insights. The Company also operates medical cannabis retail pharmacies, online platforms, distribution centers, and logistical hubs in Israel that enable the safe delivery and quality control of IMC’s products throughout the entire value chain. In Germany, the IMC ecosystem operates through Adjupharm GmbH, where it distributes cannabis to pharmacies for medical cannabis patients. Until recently, the Company also actively operated in Canada through Trichome Financial Corp and its wholly owned subsidiaries, where it cultivated, processed, packaged, and sold premium and ultra-premium cannabis at its own facilities under the WAGNERS and Highland Grow brands for the adult-use market in Canada. The Company has exited operations in Canada and considers these operations discontinued.

About Kadimastem Ltd.

Kadimastem is a clinical stage cell therapy company, developing “off-the-shelf”, allogeneic, proprietary cell products based on its technology platform for the expansion and differentiation of Human Embryonic Stem Cells (hESCs) into functional cells. AstroRx®, Kadimastem ‘s lead product, is an astrocyte cell therapy in clinical development for the treatment for ALS and in pre-clinical studies for other neurodegenerative indications.

IsletRx is Kadimastem ‘s treatment for diabetes. IsletRx is comprised of functional pancreatic islet cells producing and releasing insulin and glucagon, intended to treat and potentially cure patients with insulin-dependent diabetes. Kadimastem was founded by Professor Michel Revel, CSO of Kadimastem and Professor Emeritus of Molecular Genetics at the Weizmann Institute of Science. Professor Revel received the Israel Prize for the invention and development of Rebif®, a multiple sclerosis blockbuster drug sold worldwide. Kadimastem is traded on the Tel Aviv Stock Exchange (TASE: KDST).

For more information, please contact:

IM Cannabis Corp.
Anna Taranko, Director Investor & Public Relations
IM Cannabis Corp.
+49 157 80554338
[email protected] 

Oren Shuster, Chief Executive Officer
IM Cannabis Corp.
[email protected] 

Disclaimer for Forward-Looking Statements

This press release contains forward-looking information or forward-looking statements under applicable Canadian and U.S. securities laws (collectively, “forward-looking statements”). All information that addresses activities or developments that we expect to occur in the future are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “believe”, “plan”, “estimate”, “expect”, “likely” and “intend” and statements that an event or result “may”, “will”, “should”, “could” or “might” occur or be achieved and other similar expressions. Forward-looking statements are based on the estimates and opinions of management on the date the statements are made. In the press release, such forward-looking statements include, but are not limited to, statements regarding: the parties’ ability to complete the Proposed Transaction; the expected terms of the Proposed Transaction, the number of securities of the Company that may be issued in connection with the Proposed Transaction, the ownership ratio of the Resulting Issuer post-closing, the Loan and Spin-Out, the ability of the Company and Kadimastem to receive the requisite approvals of all regulatory bodies having jurisdiction in connection with the Proposed Transaction; and the ability of the Resulting Issuer to fulfill the listing requirements of the CSE and Nasdaq;

Forward-looking information in this news release are based on certain assumptions and expected future events, namely: the Company’s ability to continue as a going concern; continued approval of the Company’s activities by the relevant governmental and/or regulatory authorities; the continued growth of the Company; the Company’s ability to finance the completion of the Proposed Transaction; and the ability of the Resulting Issuer to fulfil the listing requirements of the CSE and Nasdaq

These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results, performance or achievements to differ materially from those expressed or implied by such statements, including but not limited to: the potential inability of the Company to continue as a going concern; risks associated with potential governmental and/or regulatory action with respect to the Company’s and/or Kadimastem’s operations; the Company’s inability to complete the Proposed Transaction; the inability of the Company and the Target to receive the requisite approvals of all regulatory bodies having jurisdiction in connection with the Proposed Transaction; and the risks associated with the Resulting Issuer’s ability to meet CSE and Nasdaq listing requirements.

Readers are cautioned that the foregoing list is not exhaustive. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated or implied by such forward looking statements due to a number of factors and risks. These include: any failure of the Company to maintain “de facto” control over Focus Medical in accordance with IFRS 10; the failure of the Company to comply with applicable regulatory requirements in a highly regulated industry; unexpected changes in governmental policies and regulations in the jurisdictions in which the Company operates; the effect of the reform on the Company; the Company’s ability to continue to meet the listing requirements of the CSE and NASDAQ; any unexpected failure to maintain in good standing or renew its licenses; the ability of the Company and Focus Medical (collectively, the “Group”) to deliver on their sales commitments or growth objectives; the reliance of the Group on third-party supply agreements to provide sufficient quantities of medical cannabis to fulfil the Group’s obligations; the Group’s possible exposure to liability, the perceived level of risk related thereto, and the anticipated results of any litigation or other similar disputes or legal proceedings involving the Group; the impact of increasing competition; any lack of merger and acquisition opportunities; adverse market conditions; the inherent uncertainty of production quantities, qualities and cost estimates and the potential for unexpected costs and expenses; risks of product liability and other safety-related liability from the usage of the Group’s cannabis products; supply chain constraints; reliance on key personnel; the risk of defaulting on existing debt and war, conflict and civil unrest in Eastern Europe and the Middle East.

Any forward-looking statement included in this press release is made as of the date of this press release and is based on the beliefs, estimates, expectations and opinions of management on the date such forward-looking information is made.

The Company does not undertake any obligation to update forward-looking statements except as required by applicable securities laws. Investors should not place undue reliance on forward-looking statements. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.

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Aurora

Aurora Partners with Script Assist to Provide Better Access to UK Medical Cannabis

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                                                                                                        NASDAQ | TSX: ACB

Partnership will empower UK patients with valuable information and guidance critical to a successful cannabis experience  

EDMONTON, AB, Feb. 28, 2024 /PRNewswire/ — Aurora Cannabis Inc. (NASDAQ: ACB) (TSX: ACB), the Canadian based leading global medical cannabis company, today announced the partnership of Aurora Medicine UK Ltd with Script Assist, a cutting-edge medical cannabis prescription platform in the UK.

Designed to support UK patients on their journey of well-being, the Script Assist platform provides access to high quality medication through their portal. Script Assist will make available an extensive range of medical cannabis products from Aurora’s leading portfolio of products. Starting in March three newly launched, high-quality hang-dried and hand-processed flower products from Aurora’s EU GMP facilities in Canada will also become available on www.scriptassist.co.uk: Pedanios 26/1 EHD-CA (Cultivar: Electric Honey Dew) and Pedanios 28/1 CMK-CA (Cultivar: Chemango Kush) with a high THC content, as well as Pedanios 10/10 EQI-CA (Cultivar: Equiposa) with balanced THC/CBD content.

“Together with our new partner, we are committed to further improve the UK medical cannabis landscape by providing patients with access to premium, high-quality products through Script Assist’s innovative technology solution,” said Trisha Cassidy, Managing Director, Aurora UK & Ireland. “We believe it is necessary and critical to expand not only access to products, but also provide valuable information to guide patients through their medical cannabis journey. We are proud to be a trusted partner for their health,” said Cassidy.

Within the platform, Script Assist is launching ‘Find a Doctor’, an easy-to-use app, which seamlessly connects patients with specialist prescribing doctors. The full range of Aurora’s medical cannabis products will be available for patients through prescription by all private doctors and clinics using the platform, transforming the UK medical cannabis prescription journey.

About Script Assist 

Script Assist revolutionises the medical cannabis prescription process in the UK by enabling private doctors and clinics to provide an easy-to-use app to their patients, including features such as transparent payment and tracking alongside live inventory levels for seamless in-app repeat requests. With the launch of its “Find a Doctor” feature, for the first time UK patients can effortlessly choose their own private doctor and then access fully streamlined medical cannabis prescriptions. The app can be accessed via the platform www.scriptassist.co.uk.

About Aurora Cannabis

Aurora is opening the world to cannabis, serving both the medical and consumer markets. Headquartered in Edmonton, Alberta, Aurora is a pioneer in global cannabis, dedicated to helping people improve their lives. The Company’s adult-use brand portfolio includes Aurora Drift, San Rafael ’71, Daily Special, Tasty’s, Being and Greybeard. Medical cannabis brands include MedReleaf, CanniMed, Aurora and Whistler Medical Marijuana Co, as well as international brands, Pedanios, Bidiol and CraftPlant. Through its subsidiary Aurora Europe GmbH, Aurora supplies high-quality medical cannabis products to patients in the German, Polish and UK markets among others, making it one of the largest authorized importers and distributors in the European Union & UK. Aurora also has a controlling interest in Bevo Farms Ltd., North America’s leading supplier of propagated agricultural plants. Driven by science and innovation, and with a focus on high-quality cannabis products, Aurora’s brands continue to break through as industry leaders in the medical, performance, wellness and adult recreational markets wherever they are launched. Aurora carries out its operations in compliance with all applicable laws in the countries in which it operates. Learn more at www.auroramj.com and follow us on X and LinkedIn.

Aurora’s common shares trade on the Nasdaq and TSX under the symbol “ACB” and is a constituent of the S&P/TSX Composite Index.

Forward Looking Information

This news release includes statements containing certain “forward-looking information” within the meaning of applicable securities law (“forward-looking statements“). Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward-looking statements made in this news release include statements regarding the Company’s partnership with Script Assist, including with respect to the availability of the Company’s medical cannabis products for patients in the UK and the Company’s continued commitment to further improve the UK medical cannabis landscape.

These forward-looking statements are only predictions. Forward looking information or statements contained in this news release have been developed based on assumptions management considers to be reasonable. Material factors or assumptions involved in developing forward-looking statements include, without limitation, publicly available information from governmental sources as well as from market research and industry analysis and on assumptions based on data and knowledge of this industry which the Company believes to be reasonable. Forward-looking statements are subject to a variety of risks, uncertainties and other factors that management believes to be relevant and reasonable in the circumstances could cause actual events, results, level of activity, performance, prospects, opportunities or achievements to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, the ability to retain key personnel, the ability to continue investing in infrastructure to support growth, the ability to obtain financing on acceptable terms, the continued quality of our products, customer experience and retention, the development of third party government and non-government consumer sales channels, management’s estimates of consumer demand in Canada and in jurisdictions where the Company exports, expectations of future results and expenses, the risk of successful integration of acquired business and operations (with respect to the Transaction and more generally with respect to future acquisitions), management’s estimation that SG&A will grow only in proportion of revenue growth, the ability to expand and maintain distribution capabilities, the impact of competition, the general impact of financial market conditions, the yield from cannabis growing operations, product demand, changes in prices of required commodities, competition, and the possibility for changes in laws, rules, and regulations in the industry, epidemics, pandemics or other public health crises, including the current outbreak of COVID-19, and other risks, uncertainties and factors set out under the heading “Risk Factors” in the Company’s annual information from dated June 14, 2023 (the “AIF”) and filed with Canadian securities regulators available on the Company’s issuer profile on SEDAR+ at www.sedarplus.com and filed with and available on the SEC’s website at www.sec.gov. The Company cautions that the list of risks, uncertainties and other factors described in the AIF is not exhaustive and other factors could also adversely affect its results. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such 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 securities law.

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Contact: For Media: Michelle Lefler, VP, Communications & PR, [email protected]; For Investors: ICR, Inc., [email protected]   

                                                      

Cision View original content:https://www.prnewswire.co.uk/news-releases/aurora-partners-with-script-assist-to-provide-better-access-to-uk-medical-cannabis-302074112.html

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