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Planet 13 Announces Q1 2021 Financial Results

Thursday, May 27, 2021 4:30 PM
Planet 13 Holdings
Topic:
Earnings
  • Q1 2021 Revenue of $23.8 million
  • Planet 13 accounted for 8.6% of all Nevada cannabis dispensary revenue in Q1
  • Q1 2021 EBITDA of $5.2 million

All figures are reported in United States dollars ($) unless otherwise indicated

LAS VEGAS, NV / ACCESSWIRE / May 27, 2021 / Planet 13 Holdings Inc. (CSE:PLTH)(OTCQB:PLNHF) ("Planet 13" or the "Company"), a leading vertically-integrated Nevada cannabis company, today announced its financial results for the three-month period ended March 31, 2021. Planet 13's financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS").

"After a slower January and February, due to COVID-19 related restrictions in place in Nevada, we had an absolutely outstanding March, April, and now May. It is clear that Vegas is back, and with hotels and casinos across the strip reporting being fully booked for the foreseeable future we think it's just getting started," said Larry Scheffler, Co-CEO of Planet 13. "After a year of fighting against the largest possible macro storm, it feels great to have the wind at our backs and to see all the improvements we put in place start to pay off."

"Tourism is back, and the SuperStore is performing well. The Medizin store is proving that our blend of entertainment, customer service, and product selection work in smaller footprint retail stores. Our wholesale is growing at a solid pace. Across our Nevada operations, we are experiencing a successful return to growth," commented Bob Groesbeck, Co-CEO of Planet 13. "In California, we are on track and on budget for our Orange County SuperStore - P13 OC. We've taken everything we've learned running the Las Vegas SuperStore and put it into this Store. We are set to open in July, and we look forward to bringing the Planet 13 experience to California and introducing it to millions of first time visitors."

Financial Highlights - Q1 - 2021

Operating Results

All comparisons below are to the quarter ended March 31, 2020, unless otherwise noted

  • Revenues were $23.8 million as compared to $16.8 million, an increase of 41.8%
  • Gross profit before biological adjustments was $12.8 million or 53.8% as compared to $9.0 million or 53.9%
  • Operating expenses, excluding non-cash compensation expense and depreciation and amortization, was $8.4 million as compared to $7.0 million, an increase of 21.0%
  • Net income before taxes of $3.0 million as compared to a net income of $0.3 million
  • Net income of $0.4 million as compared to a net loss of $1.4 million
  • Adjusted EBITDA of $5.2 million as compared to Adjusted EBITDA of $2.4 million

Balance Sheet

All comparisons below are to December 31, 2020, unless otherwise noted

  • Cash of $141.1 million as compared to $79.0 million
  • Total assets of $218.4 million as compared to $150.0 million
  • Total liabilities of $35.0 million as compared to $29.3 million

Q1 Highlights and Recent Developments

For a more comprehensive overview of these highlights and recent developments, please refer to Planet 13's Management's Discussion and Analysis of the Financial Condition and Results of Operations for the Three Months Ended March 31, 2021 (the "MD&A").

  • On February 2, 2021, Planet 13 announced closing of CDN$69 million bought deal, upsized from CDN$50 million.
  • On February 3, 2021, Planet 13 announced the start of construction on the Orange County SuperStore.
  • On March 15, 2021 Planet 13 announced a partnership with Curaleaf Select to open shop-in-shop.
  • On April 19, 2021 Planet 13 announced the grant of restricted stock units.
  • On April 22, 2021 Planet 13 announced record sales on "420."
  • On May 10, 2021 Planet 13 announced the conversion of all Class A restricted shares to common shares.

Results of Operations (Summary)

The following tables set forth consolidated statements of financial information for the three-month periods ending March 31, 2021 and March 31, 2020. For further information regarding the Company's financial results for these periods, please refer to the Company's annual financial statements for the period ended March 31, 2021 together with the MD&A, available on Planet 13's issuer profile on SEDAR at www.sedar.com and the Company's website https://www.planet13holdings.com.

Adjusted EBITDA

 
  NV Cannabis Ops     Consolidated     Consolidated  
 
  Three Months     Three Months     Three Months  
 
  Ended     Ended     Ended  
 
  Mar-31-2021     Mar-31-2021     Mar-31-2020  
EBITDA
                 
Profit (loss) before taxes
    4,356,088       3,047,835       304,497  
Add back:
                       
Biological asset adjustments
    (366,746 )     (366,746 )     (234,419 )
Non-cash share based payments
    -       203,973       810,823  
Depreciation and amortization
    1,083,122       1,083,122       987,008  
Depreciation included in COGS
    517,177       517,177       157,026  
ROU Interest included in COGS
    325,718       325,718       35,524  
Interest and non-operating expense (income)
    407,966       407,966       329,291  
 
                       
EBITDA
    6,323,325       5,219,045       2,389,750  
Margin
    26.6 %     21.9 %     14.2 %

 

Expressed in USD$
  Three Months     Three Months        
 
  Ended     Ended     Percentage  
 
  Mar-31-2021     Mar-31-2020     Change  
Revenue
                 
Revenues, net of discounts
    23,816,208       16,793,002       41.8 %
Cost of Goods Sold
    (11,006,530 )     (7,746,922 )     42.1 %
Gross Profit, Before Biological Asset Adjustment
    12,809,678       9,046,080       41.6 %
Gross Profit Margin %
    53.8 %     53.9 %        
Realized fair value amounts included in COGS
    (288,476 )     (193,196 )     49.3 %
Unrealized fair value gain on growth of biological assets
    655,222       427,615       53.2 %
Gross profit
    13,176,424       9,280,499       42.0 %
Gross Profit Margin %
    55.3 %     55.3 %        
 
                       
Expenses
                       
General and Administrative
    7,773,579       5,522,514       40.8 %
Sales and Marketing
    659,949       1,446,608       (54.4 %)
Depreciation and Amortization
    1,083,122       987,008       9.7 %
Share based payments
    203,973       810,823       (74.8 %)
Total Expenses
    9,720,623       8,766,953       10.9 %
 
                       
Income (Loss) From Operations
    3,455,801       513,546       572.9 %
 
                       
Other (Income) Expense:
                       
Interest Expense, net
    470,863       281,005       67.6 %
Realized Foreign Exchange gain (loss)
    -       -     na  
Other expense (income)
    (62,897 )     (71,956 )     (12.6 %)
Total Other (Income) Expense
    407,966       209,049       95.2 %
 
                       
Income (loss) for the period before tax
    3,047,835       304,497       900.9 %
Provision for income tax (current and deferred)
    2,605,072       1,713,559       52.0 %
Income (Loss) for the period
    442,763       (1,409,062)       (131.4 %)
 
                       
Other Comprehensive Income (Loss)
                       
Items that may be reclassified subsequently to profit/loss
                       
Foreign exchange translation adjustment
    829,635       31,069          
Net Comprehensive Income (Loss) for the period
    1,272,398       (1,377,993)          
Income (Loss) per share for the period
                       
Basic and fully diluted income (loss) per share
  $ 0.00     $ (0.01)          
 
                       
Weighted Average Number of Shares Outstanding
                       
Basic
    190,777,592       138,915,955          
Diluted
    193,050,462       138,915,955          

Outstanding Shares

As of May 26, 2021, the Company had 196,386,104 common shares outstanding. There were 184,168 options issued and outstanding of which 176,669 have fully vested. There were 8,877,751 warrants outstanding and 4,994,567 RSU's outstanding of which nil RSUs had fully vested as at the date of this MD&A.

Conference Call

Planet 13 will host a conference call on Thursday, May 27, 2021 at 5:00 p.m. ET to discuss its first quarter financial results and provide investors with key business highlights. The call will be chaired by Bob Groesbeck, Co-CEO, Larry Scheffler, Co-CEO, and Dennis Logan, CFO.

CONFERENCE CALL DETAILS

Date: May 27, 2021 | Time: 5:00 p.m. EST

Participant Dial-in: Toll Free 877-407-8035 or International 201-689-8035

Replay Dial-in: Toll Free 877-481-4010 or International 919-882-2331

(Available for 2 weeks)

Reference Number: 41412

Listen to webcast: https://bit.ly/3or4jFC

Financial Measures

There are measures included in this news release that do not have a standardized meaning under generally accepted accounting principles (GAAP) and therefore may not be comparable to similarly titled measures and metrics presented by other publicly traded companies. The Company includes these measures because it believes certain investors use these measures and metrics as a means of assessing financial performance. EBITDA (earnings before interest, taxes, depreciation and amortization) is calculated as net earnings before finance costs (net of finance income), income tax expense, and depreciation and amortization of intangibles and is a non-GAAP financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies.

For further inquiries, please contact:

LodeRock Advisors Inc., Planet 13 Investor Relations
[email protected]
(416) 519-2156 ext. 2230

Bob Groesbeck and Larry Scheffler
Co-Chief Executive Officers
[email protected]

About Planet 13

Planet 13 (www.planet13holdings.com) is a vertically integrated cannabis company based in Nevada, with award-winning cultivation, production and dispensary operations in Las Vegas - the entertainment capital of the world. Planet 13's mission is to build a recognizable global brand known for world-class dispensary operations and a creator of innovative cannabis products. Planet 13's shares trade on the Canadian Stock Exchange (CSE) under the symbol PLTH and OTCQX under the symbol PLNHF.

Cautionary Note Regarding Forward-Looking Information

This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward looking-statements relate to, among other things, Planet 13's first California location and the timeline for opening of the Santa Ana dispensary.

These forward-looking statements are based on reasonable assumptions and estimates of management of the Company at the time such statements were made. Actual future results may differ materially as forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to materially differ from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors, among other things, include: final regulatory and other approvals or consents; risks associated with COVID-19 and other infectious diseases presenting as major health issues; fluctuations in general macroeconomic conditions; fluctuations in securities markets; expectations regarding the size of the Nevada and California cannabis market and changing consumer habits; the ability of the Company to successfully achieve its business objectives; plans for expansion; political and social uncertainties; inability to obtain adequate insurance to cover risks and hazards; and the presence of laws and regulations that may impose restrictions on cultivation, production, distribution and sale of cannabis and cannabis related products in the State of Nevada and California; and employee relations. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. The Company assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.

The Company is indirectly involved in the manufacture, possession, use, sale and distribution of cannabis in the recreational and medicinal cannabis marketplace in the United States through licensed subsidiary entities in states that have legalized marijuana operations, however, these activities are currently illegal under United States federal law. Additional information regarding this and other risks and uncertainties relating to the Company's business, including COVID-19, are contained under the heading "Risk Factors" and elsewhere in the Company's annual information form dated April 5, 2021 filed on its issuer profile on SEDAR at www.sedar.com.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

Expressed in United States Dollars
  As at     As at  
 
  March 31,     December 31,  
 
  2021     2020  
Assets
           
Current Assets
           
Cash
  $ 141,126,157     $ 79,000,850  
HST receivable
    132,636       103,445  
Inventories (Note 5)
    9,099,432       7,334,717  
Biological assets (Note 6)
    920,975       640,995  
Prepaid expenses and other current assets (Note 10)
    5,057,135       2,637,547  
Total Current Assets
    156,336,335       89,717,554  
 
               
Property and equipment (Note 7)
    34,149,653       32,073,925  
Licenses (Note 8)
    7,007,362       7,007,362  
Right of use assets (Note 9)
    19,894,552       20,149,721  
Long-term deposits and other assets
    1,054,443       1,054,443  
 
    62,106,010       60,285,451  
Total Assets
  $ 218,442,345     $ 150,003,005  
 
               
Liabilities
               
Current Liabilities
               
Accounts payable
  $ 3,293,068     $ 1,683,833  
Accrued expenses
    4,273,664       2,844,714  
Income taxes payable
    3,716,909       1,220,652  
Notes payable - current portion (Note 11)
    884,000       884,000  
Total Current Liabilities
    12,167,641       6,633,199  
 
               
Long -term lease liabilities (Note 12)
    22,404,495       22,326,077  
Other long-term liabilities
    28,000       28,000  
Deferred tax liability
    422,237       313,422  
 
    22,854,732       22,667,499  
Total Liabilities
    35,022,373       29,300,698  
 
               
Shareholders' Equity
               
Share capital (Note 13)
    196,957,891       139,177,034  
Restricted share units (Note 13)
    1,714,792       3,262,351  
Warrants (Note 13)
    12,255,137       6,972,053  
Option reserve (Note 13)
    204,966       276,081  
Accumulated other comprehensive loss
    350,513       (479,122 )
Deficit
    (28,063,327 )     (28,506,090 )
Total Shareholders' Equity
    183,419,972       120,702,307  
Total Liabilities and Shareholders' Equity
  $ 218,442,345     $ 150,003,005  

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND
C
OMPREHENSIVE INCOME (LOSS)

Expressed in United States Dollars
  Three months     Three months  
 
  Ended     Ended  
 
  March 31,     March 31,  
 
  2021     2020  
Revenue
           
Revenues, net of discounts
  $ 23,816,208     $ 16,793,002  
Cost of Goods Sold
    (11,006,530 )     (7,746,922 )
Gross Profit before fair value asset adjustment
    12,809,678       9,046,080  
Realized fair value amounts included in inventory sold
    (288,476 )     (193,196 )
Unrealized fair value gain on growth of biological assets
    655,222       427,615  
Gross Profit
    13,176,424       9,280,499  
 
               
Expenses
               
General and Administrative (Note 12 and Note 14)
    7,773,579       5,522,514  
Sales and Marketing
    659,949       1,446,608  
Depreciation and Amortization (Note 7 & 9)
    1,083,122       987,008  
Share-Based Compensation Expense (Note 13 and Note 17)
    203,973       810,823  
Total Expenses
    9,720,623       8,766,953  
 
               
Other Expense:
               
Interest expense, net
    470,863       281,005  
Other income
    (62,897 )     (71,956 )
Total Other Expense
    407,966       209,049  
 
               
Income before income taxes
    3,047,835       304,497  
Provision for tax - current
    2,496,257       1,853,382  
Provision for tax - deferred
    108,815       (139,823 )
Income (loss) for the period
  $ 442,763     $ (1,409,062)  
 
               
Other Comprehensive Income
               
 
               
Foreign exchange translation gain
    829,635       31,069  
Net Comprehensive Income (Loss) for the period
  $ 1,272,398     $ (1,377,993)  
 
               
Net income (loss) per share for the period
               
Basic and diluted income (loss) per share (Note 16)
  $ 0.00     $ (0.01)  
 
               
Weighted Average Number of Common Shares Outstanding
               
Basic
    190,777,592       138,915,955  
Diluted
    193,050,462       138,915,955  

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Expressed in United States Dollars
  Three Months     Three Months  
 
  Ended     Ended  
 
  March 31,     March 31,  
 
  2021     2020  
Operating activities
           
Net income (loss) for the period
  $ 442,763     $ (1,409,062 )
Add (deduct) non-cash items:
               
Share based payments (Note 13 and 17)
    203,973       810,823  
Depreciation and amortization (Note 7 and 9)
    1,651,389       1,400,265  
Deferred tax liability
    108,815       (171,041 )
Other assets
    -       (1,317,580 )
Non-cash accretion of lease liabilities (Note 12)
    367,337       -  
Non-cash interest expense on ROU Liabilities (Note 12)
    470,863       400,836  
 
               
Net change in non-cash working capital
               
HST receivable
    (30,505 )     (8,112 )
Inventories (Note 5)
    (1,764,715 )     (1,151,096 )
Biological assets (Note 6)
    (279,980 )     (125,294 )
Prepaid expenses and other assets (Note 10)
    (2,421,189 )     788,819  
Accounts payable
    1,609,684       1,206,528  
Accrued expenses
    1,428,951       133,728  
Income tax payable
    2,496,257       1,884,600  
Cash flow provided by operating activities
    4,283,643       2,443,414  
 
               
Investing activities
               
Purchase of property and equipment (Note 7)
    (3,471,948 )     (2,086,591 )
Cash flow used in investing activities
    (3,471,948)       (2,086,591)  
 
               
Financing activities
               
Issuance of shares on warrant and option exercises (Note 13)
    10,884,762       1,064,521  
Issuance of shares and warrants on financings (Note 13)
    50,356,532       -  
Payment on lease liabilities (Note 12)
    (759,782 )     (329,245 )
Cash flow provided by financing activities
    60,481,512       735,276  
 
               
Net increase in cash
    61,293,207       1,092,099  
Cash at beginning of the year
    79,000,850       12,814,712  
Effect of foreign exchange on cash
    832,100       31,069  
Cash at end of the period
  $ 141,126,157     $ 13,937,880  

1 Market share data is based on January and February results https://tax.nv.gov/uploadedFiles/taxnvgov/Content/TaxLibrary/NV-Marijuana-Revenue-FY21(4).pdf

SOURCE: Planet 13 Holdings
Topic:
Earnings
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