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Mene Inc. Reports Financial Results for First Quarter 2019

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TORONTO–(BUSINESS WIRE)–lt;a href=”https://twitter.com/search?q=%24MENE&src=ctag” target=”_blank”gt;$MENElt;/agt; lt;a href=”https://twitter.com/hashtag/earnings?src=hash” target=”_blank”gt;#earningslt;/agt;–Menē Inc. (TSX-V:MENE) (US:MENEF) (“Menē” or the “Company”),
an online 24 karat investment jewelry brand, today announced financial
results for the first quarter ended March 31, 2019 (“Q1 2019”).
All amounts are expressed in Canadian dollars unless otherwise noted.

FINANCIAL HIGHLIGHTS:

  • IFRS Revenue of $2.7 million, a $1.7 million (163%) increase
    year-over-year (“YoY”). Non-IFRS Adjusted Revenue of $2.9
    million, an increase of 151% YoY.
  • Gross Profit of $0.7 million, an increase of $0.5 million (298%) YoY.
  • Gross Margin expanded by 900 basis points, from 16% in Q1 2018 to 25%
    in Q1 2019.
  • Generated $0.3 million in Free Cash Flow in Q1 2019, the net of
    operating cash flow less capital expenditures.
  • Reduced Net Loss by 26% to $1.1 million from $1.5 million in Q1 2018.
    Non-IFRS Adjusted Loss decreased by 54% YoY to $0.6 million.
  • Sold 8,182 units of jewelry through 7,354 customer orders, an increase
    of 7,242 units (770%) and 6,469 orders (731%) respectively compared to
    Q1 2018.
  • Gold Weight Sold increased by 17 kilograms (115%) and Platinum Weight
    Sold increased by 9.6 kilograms (685%) from Q1 2018.
  • Strong Tangible Common Equity of $17.8 million, with $17.5 million in
    cash and cash equivalents and $16.2 million in short-term investments
    as of March 31, 2019. Tangible Common Equity increased by 58% YoY,
    demonstrating the Company’s ability to access cash to grow the
    business and its high-margin and low fixed-cost business model.

OPERATIONAL HIGHLIGHTS:

  • Introduced 99 new product designs during the quarter.
  • Launched “Menē x”, a new product category of limited-edition jewelry
    collections designed in collaboration with select creators, artists
    and tastemakers. Unveiled first collaboration with world-renowned
    fashion photographers Inez van Lamsweerde and Vinoodh Matadin (“Inez &
    Vinoodh”).
  • Raised $20 million in a Debt Financing Round with a strategic lender.
       

IFRS Consolidated Income Statement Data
& Key
Performance Indicators (KPIs)
5

FY 2019   FY 2018  

July 11, 2017
to December
31, 2017 6

    Q1   Q4   Q3   Q2   Q1  
Revenue (CAD)     2,733,596   3,510,374   1,985,711   1,392,867   1,038,947   63,909
Gross profit (CAD)     678,814   983,840   208,408   229,461   170,486   12,143
Gross margin (%)     25%   28%   10%   16%   16%   19%
Total comprehensive loss     (1,166,288)   (2,681,362)   (1,691,124)   (919,106)   (1,348,026)   (1,702,048)
Non-IFRS Adjusted Revenue (CAD) 1     2,914,297   3,948,113   2,346,622   1,891,608   1,162,777   67,114
Non-IFRS Adjusted Gross Profit (CAD) 2     723,686   1,106,524   246,287   311,623   190,806   12,752
Non-IFRS Adjusted Loss 3     (577,218)   (469,487)   (1,136,242)   (758,895)   (1,251,091)   (1,639,950)
Total Shareholders’ Equity (CAD)     17,833,109   18,516,087   10,077,520   11,251,166   11,878,195   13,192,937
Inventory balance (kg of gold) 4     222   244   135   131   90   54
Customer orders     4,437   6,729   3,994   2,389   951   74
Units of jewelry sold     8,182   9,111   6,168   2,920   941   80
Jewelry weight sold (total kg)     43   51   35   23   16   1
     

Notes:

(1) The Company adjusts its revenue by adding back the value of jewelry
that the Company bought back from customers, or was returned by
customers, and discounts given to customers. These adjustments are made
to assess the gross revenue before deducting these items from revenue
per IFRS. See Non-IFRS Measures for a full definition.

(2) The Company adjusts its gross profit by adjusting for Non-IFRS
revenue and the attributable weighted average cost of sales for the
value of jewelry that the Company bought back from customers, or was
returned by customers, and discounts given to customers. See Non-IFRS
Measures for a full definition.

(3) The Company adjusts its total comprehensive loss by adjusting for
Non-IFRS Adjusted Gross Profit, and removing the impact of non-cash
expenses, consisting of depreciation and amortization, stock based
compensation, and a one-time listing expense, the fair value of
5,984,750 shares issued for the amalgamation with Amador Gold Corp.’s
subsidiary in Q4 2018. See Non-IFRS Measures for a full definition.

(4) Inventory balances in kilograms of gold are calculated by taking the
total Canadian Dollar (CAD) inventory value at each quarter-end date,
and dividing the value by the CAD gold spot price per gram.

(5) The period July 11, 2017 to December 31, 2017 and the fiscal year
ended December 31, 2018 are audited figures. The period Q1 to Q3 2018
have been reviewed by the same independent audit firm, KPMG. Q1 2019 has
not been reviewed.

(6) The Company began generating sales to an invite-only group in
October 2017. The Company began selling to the general public in January
2018.

Statement from Founder & CEO Roy Sebag:

Menē continues to show compelling organic growth and sales momentum. In
Q1, we generated over $2.7 million of sales, $0.7 million in gross
margin, and $0.3 million in IFRS Free Cash Flow. It is important to
remind our shareholders that this business has only been in operation
for 15 months at the quarter-end date. Following the completion of our
debt-note funding and a repayment of a portion of the historic loans
from Goldmoney Inc., our balance sheet is strong and well-positioned for
the next few years. We remain focused on building our brand equity
within the fashion, art, and jewelry cultural segments, seeing that with
each passing day, our brand is being embraced by popular thought leaders
and tastemakers. As of today’s date, we have over 30,000 registered
customers from over 20 countries around the world. Inventory levels
remain strong and are being built up in anticipation of a strong
2019-2020 season (October-February). I am very proud of the hard work
and dedication shown by our team and the disciplined way in which we are
building this company and its business model. My personal focus this
quarter has been in setting the infrastructure for several C-level
executive hires in Paris and Toronto which will help the company scale
its operations and position Menē for sustained growth in the years to
come. I look forward to updating our shareholders on these developments
as they formally materialize.

Non-IFRS Measures

This news release contains non-IFRS financial measures; the Company
believes that these measures provide investors with useful supplemental
information about the financial performance of its business, enable
comparison of financial results between periods where certain items may
vary independent of business performance, and allow for greater
transparency with respect to key metrics used by management in operating
its business. Although management believes these financial measures are
important in evaluating the Company’s performance, they are not intended
to be considered in isolation or as a substitute for, or superior to,
financial information prepared and presented in accordance with IFRS.
These non-IFRS financial measures do not have any standardized meaning
and may not be comparable with similar measures used by other companies.
For certain non-IFRS financial measures, there are no directly
comparable amounts under IFRS. These non-IFRS financial measures should
not be viewed as alternatives to measures of financial performance
determined in accordance with IFRS. Moreover, presentation of certain of
these measures is provided for year-over-year comparison purposes, and
investors should be cautioned that the effect of the adjustments thereto
provided herein have an actual effect on the Company’s operating results.

Non-IFRS Adjusted Revenue1 is a non-IFRS measure. The Company
adjusts its revenue by adding back the value of jewelry that the Company
bought back from, or was returned by customers, and discounts given to
customers. These adjustments are made to assess the gross revenue before
deducting these items per IFRS revenue.

Non-IFRS Adjusted Gross Profit2 is a non-IFRS measure. The
Company adjusts its gross profit by adjusting for the additional revenue
and associated cost of sales added back for the value of jewelry that
the Company bought back from, or was returned by customers, and
discounts given to customers.

Non-IFRS Adjusted Loss3 is a non-IFRS measure. The Company
adjusts its total comprehensive loss by adjusting for Non-IFRS Adjusted
Gross Profit, and removing the impact of non-cash expenses, consisting
of depreciation and amortization, stock based compensation, and a
one-time listing expense, the fair value of 5,984,750 shares issued for
the amalgamation with Amador Gold Corp.’s subsidiary in Q4 2018.

For a full definition of non-IFRS financial measures used herein to
their nearest IFRS equivalents, please see the section entitled
“Non-IFRS Financial Measures” in the Company’s MD&A for the three months
ended March 31, 2019.

About Menē Inc.

Menē crafts pure 24 karat gold and platinum jewelry that is
transparently sold by gram weight. Through mene.com, customers may buy
jewelry, monitor the value of their collection over time, and sell or
exchange their pieces by gram weight at prevailing market prices. Menē
was founded by Roy Sebag and Diana Widmaier-Picasso with a mission to
restore the relationship between jewelry and savings. Menē empowers
consumers by marrying innovative technology, timeless design, and pure
precious metals to create pieces which endure as a store of value.

For more information about Menē, visit mene.com.

Forward-Looking Statements

This news release contains or refers to certain forward-looking
information. Forward-looking information can often be identified by
forward-looking words such as “anticipate”, “believe”, “expect”, “plan”,
“intend”, “estimate”, “may”, “potential” and “will” or similar words
suggesting future outcomes, or other expectations, beliefs, plans,
objectives, assumptions, intentions or statements about future events or
performance. All information other than information regarding historical
fact, which addresses activities, events or developments that the Menē
Inc. (the “Company”) believes, expects or anticipates will or may occur
in the future, is forward looking information. Forward-looking
information does not constitute historical fact but reflects the current
expectations the Company regarding future results or events based on
information that is currently available. By their nature,
forward-looking statements involve numerous assumptions, known and
unknown risks and uncertainties, both general and specific, that
contribute to the possibility that the predictions, forecasts,
projections and other forward-looking information will not occur. Such
forward-looking information in this release speak only as of the date
hereof.

Contacts

Media and Investor Relations Inquiries:
Renee Wei
Head
of Investor Relations
+1 647 494 0296
ir@mene.com

Robert Lee
Chief Financial Officer
robert@mene.com

Cannabis

Willow Biosciences Reports Third Quarter 2019 Results and Provides Operations Update

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Willow Biosciences Inc. (“Willow” or the “Company“) (CSE: WLLW, OTCQB: CANSF) has released its financial and operating results for the three and nine months ended September 30, 2019.

“Over the past few months, Willow has continued to advance its business strategy and achieved several important milestones,” said Trevor Peters, Willow’s President and Chief Executive Officer. “We have made meaningful progress on advancing our yeast strain performance and fully expect to meet our projected timing of scale-up development in the first half of 2020. In addition, we have completed the commissioning of our three labs and expanded our team of highly skilled scientists, preparing us for future development.  As the market for CBD and other cannabinoids continues to develop, Willow is positioned as a leader in delivering ultra-pure, pharmaceutical grade cannabinoids, at a highly competitive cost for the consumer packaged goods and pharmaceutical industries.”

Selected financial and operational information is outlined below and should be read in conjunction with Willow’s unaudited condensed consolidated interim financial statements (“Financial Statements”) and related management’s discussion and analysis (“MD&A”) which are available on SEDAR at www.sedar.com or on the Willow’s website at www.willowbio.com.

Highlights for the Quarter:

  • Willow’s science team successfully increased cannabinoid production by 25-fold and identified hundreds of beneficial genetic changes that are expected to provide additional increases.
  • Willow ended the quarter with strong liquidity, including approximately $24.0 million of cash on hand at September 30, 2019.
  • Willow continued to build out our three labs in Calgary, AlbertaBurnaby, British Columbia and Mountain View, California, spending $3.2 million in capex in the quarter ($6.4 million year to date as of September 30th). With the bulk of our capital spending to set up our labs behind us, Willow continues to focus on advancing our yeast strain to produce ultra-pure, pharmaceutical grade cannabidiol (CBD).
  • In the quarter we moved into our new facility in Calgary, Alberta located in the Life Sciences Innovation Hub at the University Research Park. The 4,000 square foot secure facility employs cutting-edge bioassay capabilities, liquid handling robots, and analytical instrumentation, and leverages access to the University of Calgary’s plant cultivation resources and growth chambers.
  • Willow continues to progress its intellectual property portfolio and expects to file five new U.S. provisional patent applications and one Patent Cooperation Treaty “PCT” conversion (which will convert an existing provisional patent application to a U.S. PCT application), all prior to the end of 2019.
  • Subsequent to the end of the quarter, the Company received its DEA Controlled Substances Registration Certificate for our Mountain View, California facility, which allows the Company to develop yeast strains which produce CBD.
  • On November 5, 2019, the Company commenced trading on the OTCQB® Venture Market under the ticker “CANSF”.
  • Willow’s directors and officers remain committed to the long-term success of the Company and since July 1, 2019, certain officers and board members of Willow have purchased approximately 1.5 million common shares and warrants of Willow in the market for aggregate proceeds of approximately $840,000.

Operational Update

During the past quarter, we have expanded our research and development team to 33 technical staff, including 21 Ph.D. level scientists, across our three sites. Our multidisciplinary team consists of plant scientists, strain engineers, analytical chemists and fermentation process engineers.  The team’s focus has now shifted from expanding its technical capabilities to program execution and operational excellence.  Our plant sciences team in Canada continues to advance its understanding of cannabinoid accumulation in C. sativa along with translation of these results in our yeast production host.  These results are further complemented by our high-throughput strain engineering capabilities in our San Francisco Bay Area labs to expand upon beneficial genetic diversity and further optimize our yeast strain toward commercial targets.  As a result of these combined efforts, we have increased cannabinoid production by 25-fold and identified hundreds of beneficial genetic changes that will provide additional increases.  These improved strains are now undergoing evaluation in fermentation tanks at our development partner’s facilities.  At our current trajectory, we anticipate delivering a strain for scale up development starting in the first half of 2020.

Financial Update

Willow ended the quarter in a strong financial position, with approximately $23.2 million in working capital and $24.0 million of cash on hand.

The Corporation’s financial results are summarized as follows:

Three months ended
September 30

Nine months ended
September 30

2019

2018

2019

2018

Balance sheet ($000’s):

Cash and cash equivalents

24,042

804

24,042

804

Total assets

38,624

1,038

38,624

1,038

Shareholder’s equity

24,727

975

24,727

975

Weighted average shares outstanding

Basic and diluted (000’s)

78,634

56,521

69,657

53,585

Year to date 2019 has been transformative for the Company. The transactions Willow has completed have had a significant impact on the comparability of the Company’s period over period results. See the Financial Statements and MD&A for further details.

Outlook

Willow will continue to focus on developing and refining our yeast-based strains that biosynthesize CBD, optimizing our production levels and improving the performance of our processes. We expect to reach a scalable production level in the first half of 2020, triggering the initiation of Noramco, Inc.’s efforts to ramp up production, file regulatory submissions and develop marketing and distribution plans. The scaling up of production to commercial levels is expected to take 12 to 18 months, followed by regulatory approval for the manufacturing process and customer sampling during 2021, and first bulk commercial sales anticipated in late 2021 or early 2022.

Following our successful financings, Willow is well positioned to fund our operations to commercialization.

Willow continues to evaluate strategic relationships with various entities in the consumer packaged goods and pharmaceutical industries. These partnerships will look to define our market participation and potentially gain entry into new global markets.

 

SOURCE Willow Biosciences Inc.

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Cannabis

OPSEU gives thumbs down to Ford’s attempt to fix cannabis debacle

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The Ford government’s latest reset of its disastrous decision to privatize cannabis sales is bound to make an already bad situation worse, says OPSEU President Warren (Smokey) Thomas.

“What will it take for the government to understand that cannabis retail stores need to be operated by trained professionals?” asked Thomas.

Thomas can’t believe the Ford government is set to move to an “open allocation” system for issuing retail cannabis licenses as early as January that could result in over 1,000 outlets across Ontario.

“I can’t figure out why the Conservatives think it makes sense to continue on with this privatization disaster,” said Thomas.  “We need a Responsible Plan, the kind of plan the previous government had that would have put cannabis sales in the hands of the LCBO.

“Polls have shown us that Ontarians are 11 times more likely to trust the LCBO than private retailers when it comes to keeping cannabis out of kids’ hands,” Thomas added.

“This is a matter of public safety. LCBO stores have trained professionals who have the training and experience to handle sales of controlled substances.”

Over a year ago when the discussion around cannabis retail stores began, the Ford government made a number of promises – promises they are now breaking, says Thomas.

“They promised a tightly regulated system. What does this new plan involve? It involves flooding the market. How is that responsible? The second promise was to keep our kids safe. This doesn’t keep our kids safe.”

“Our members who operate LCBO stores are experts in responsible sales,” he adds. “They keep our kids and our communities safe because they are trained and qualified. They take social responsibility seriously.”

It’s time for Ford to give up trying to find solutions for a problem that doesn’t exist, says OPSEU First Vice President/Treasurer, Eduardo (Eddy) Almeida.

“The solution has been there in front of them all along,” says Almeida.  “How many failed attempts and half-baked ideas are they going to try?”

“First Mr. Ford hits us with a crazy lottery scheme that resulted in only a handful of stores operated by people as random as the process that selected them and now he just wants to open this up as a free-for-all? We need a clear and thoughtful plan, and the LCBO is the solution.”

SOURCE Ontario Public Service Employees Union (OPSEU)

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Cannabis

CannTrust Provides Default Status Report

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CannTrust Holdings Inc. (“CannTrust” or the “Company”, TSX: TRST, NYSE: CTST) today is providing a status update in accordance with its obligations under the alternative information guidelines set out in National Policy 12-203 – Management Cease Trade Orders (“NP 12-203”), which require the Company to provide bi-weekly updates until such time as the Company is current with its filing obligations under Canadian securities laws. As previously announced, the Company is subject to a management cease trade order (“MCTO”) issued by the Ontario Securities Commission. The MCTO prohibits the directors and executive officers of the Company from trading in or acquiring securities of the Company until two full business days after the Company files an interim financial report for the three and six month periods ended June 30, 2019, an interim management’s discussion and analysis for the corresponding period and certifications of interim filings. The MCTO does not affect the ability of investors who are not insiders to trade in the securities of the Company.

Timing of Financial Results

Although the Company is continuing to make progress in working with its independent auditor in connection with its restated audited financial statements for the year ended December 31, 2018, its restated interim financial statements for the first quarter of 2019, and its interim financial statements for the second and third quarters of 2019, together with the related management’s discussion and analysis for the corresponding periods, such financial statements are unlikely to be completed and filed before the end of the calendar year.

The Company advises that: (i) other than as disclosed above, there have been no material changes to the information contained in the Company’s August 16, 2019 news release, August 29, 2019 news release, September 12, 2019 news release, September 26, 2019 news release, October 10, 2019 news release, October 24, 2019 news release, and November 7, 2019 news release; (ii) it intends to continue to comply with the alternative information guidelines of NP 12-203; and (iii) except as previously disclosed, there are no subsequent specified defaults (actual or anticipated) within the meaning of NP 12-203.

Forward-Looking Statements

This press release contains “forward-looking information” within the meaning of Canadian Securities laws and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbor laws, and such statements are based upon CannTrust’s current internal expectations, estimates, projections, assumptions and beliefs and views of future events. Forward-looking information and forward-looking statements can be identified by the use of forward-looking terminology such as “believes”, “expect”, “likely”, “may”, “will”, “should”, “intend”, “anticipate”, “potential”, “proposed”, “estimate” and other similar words, including negative and grammatical variations thereof, or statements that certain events or conditions “may”, “would” or “will” happen, or by discussions of strategy.

The forward-looking information and statements in this news release include statements relating to the corrective actions being taken by the Company, and Health Canada’s pending determinations. Forward-looking information and statements necessarily involve known and unknown risks, including, without limitation: actions taken in respect of the Company’s products by its customers and regulators; results of Health Canada’s investigation, including orders and compliance measures required by Health Canada and their impact on the operations, inventory, assets and financial condition of the Company; the Company’s implementation of remediation plans and related actions; regulatory approval; risks associated with general economic conditions; adverse industry events; loss of markets; future legislative and regulatory developments in Canadathe United States and elsewhere; the cannabis industry in Canada generally; and, the ability of CannTrust to implement its business strategies.

Any forward-looking information and statements speak only as of the date on which they are made, and, except as required by law, CannTrust does not undertake any obligation to update or revise any forward-looking information or statements, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for CannTrust to predict all such factors. When considering these forward-looking information and statements, readers should keep in mind the risk factors and other cautionary statements in CannTrust’s Annual Information Form dated March 28, 2019 (the “AIF”) and filed with the applicable Canadian securities regulatory authorities on SEDAR at www.sedar.com and filed as an exhibit CannTrust’s Form 40-F annual report under the United States Securities Exchange Act of 1934, as amended, with the United States Securities and Exchange Commission on EDGAR at www.sec.gov. The risk factors and other factors noted in the AIF could cause actual events or results to differ materially from those described in any forward-looking information or statements.

The TSX and NYSE do not accept responsibility for the adequacy or accuracy of this release.

SOURCE CannTrust Holdings Inc.

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