- Revenue of US$9.4 million; Adjusted EBITDAi of US$3.6 million (margin of 38.0%); Fully diluted EPS of US$0.01; and operating cash flow of US$2.4 million.
- The Company will hold a conference call and webcast on Thursday November 18, 2021, at 8:00am ET to discuss its Q3 financial results.
Vext Science, Inc. (“Vext” or the “Company”) (OTCQX: VEXTF) (CSE: VEXT) a cannabinoid brand leader based in Arizona, leveraging its core expertise in extraction, manufacturing, cultivation, and marketing to build a profitable multi-state footprint, today reported its financial results for the period ended September 30, 2021. All currency references used in this news release are in U.S. currency unless otherwise noted.
Summary Financial Results (unaudited)
| Q3 2021 | Q3 2020 | Q2 2021 | |
| Revenue | $9,399,700 | $7,951,648 | $9,375,774 |
| Gross margini (%) | 43.6% | 39.4% | 45.0% |
| Net income (loss) after taxes | $970,106 | $1,412,974 | $1,792,449 |
| Earnings per common share, fully diluted | $0.01 | $0.01 | $0.01 |
| Adjusted EBITDAi | $3,567,827 | $2,581,347 | $3,463,735 |
| Adjusted EBITDA margini (%) | 38.0% | 32.5% | 36.6% |
Management Commentary
Eric Offenberger, CEO of VEXT, commented, “During Q3, our team in Arizona generated solid revenue, while maintaining strict cost control and realizing efficiencies from our recently completed manufacturing expansion. These factors drove Adjusted EBITDA margins up by over 140bps sequentially, to 38%. Q4 is off to a strong start and overall, we expect continued growth in the Arizona market, which recently surpassed Colorado as the second largest cannabis market in the U.S.” ii
Mr. Offenberger added, “While market-wide inflationary pressures will likely translate into some additional price sensitivity within certain consumer groups in the short-term, Vext’s vertically integrated position gives it a competitive advantage. We have opted to divide our Eloy expansion into two phases, to allow construction costs to normalize and ensure we are able to optimally match Phase I production with our own retail needs. We expect the next 12 months to be an important period for Vext as we continue to grow in Arizona, look for accretive opportunities to expand our footprint in the market and continue to solidify a vertical position in Ohio, all backed by a proven track record of operational excellence and profitability.”
Summary of Recent Operating Developments
- Today, Vext also announced that given elevated construction costs market-wide, the Company has made the decision to revise the previously announced expansion schedule at its Eloy cultivation facility. The Company now plans to divide construction into two phases. Phase I is expected to be complete during Q3 2022, and will bring canopy at Eloy to ~17,000 square feet. Phase II, expected to be complete during Q3 of 2023, will bring total canopy on site to ~34,000 square feet.
- On November 17, 2021, Vext announced that an affiliated entity (the “Affiliate”) of Appalachian Pharm Processing, LLC, an Ohio limited liability company (“APP”), has received a Level I Cultivator provisional license (the “License”) to be co-located at the APP facility at 16064 Beaver Pike, Jackson, Ohio. The License, granted by the Ohio Department of Commerce, will enable the Affiliate to build-out an initial cultivation area of up to 25,000 square feet, with the potential to expand up to 50,000 square feet following further application and approval.
- On October 18, 2021, Vext announced that it had received approval to have ownership of a manufacturing operation in Ohio, through a 37.5% ownership interest in APP. In July 2022, the Company expects to apply to the Ohio regulators, through another affiliated joint venture partner (the “Joint Venture”), to transition an operating cannabis dispensary license to the Joint Venture. The combination of these acquisitions, once approved by the Ohio regulators and completed, will move Vext closer to vertical integration in Ohio, which is an attractive limited license state with the potential for a future transition into an adult-use market.
Q3-2021 Financial Results Conference Call
Vext will host a conference call and webcast Thursday November 18, 2021, at 8:00 a.m. ET to discuss its third quarter financial results. The call will be chaired by Eric Offenberger, CEO and Vahan Ajamian, CFO:
Date: November 18, 2021 | Time: 8:00 a.m. ET
Participant Dial-in: 416-764-8609 or 1-888-390-0605
Replay Dial-in: 416-764-8677 or 1-888-390-0541
Conference ID: 92801735
Playback #: 801735 (Expires December 2, 2021)
Listen to webcast: https://bit.ly/3pLqGIl
