Red White & Bloom Brands Inc. (CSE: RWB and OTCQX: RWBYF) (“RWB” or the “Company”), a multi-state cannabis operator and house of premium brands, is pleased to report 2021 1st quarter financial results and subsequent events. The Company will be filing its Q1 2021 financial statements and related Management’s Discussion and Analysis today.
Brad Rogers, Chairman & CEO, commented, “This was another great quarter for the Company as we continued to see strong traction for our brands. We are building on that momentum and working towards finalizing our revised asset purchase of our Michigan investee to bring their revenue, as well as adjusted sales into IFRS revenue format before the end of this current quarter. Once complete, and the expansion of our Florida operations come on stream, we can finally report in our quarterly results the strength of what we have built and accomplished thus far.”
The Company reports adjusted sales for the 1st quarter of $32.7 million, a sequential increase of 14.5% from the prior quarter’s adjusted sales of $28.6 million in Q4 2020. The increase was reduced by the strengthening Canadian dollar and would have been about $1 million higher using a constant dollar comparison.
The Company utilizes a 3rd party licensee in Michigan; further to the licensing agreement, the revenue the Company can recognize is product sales less inventory purchases and direct expenses. As a result, the Company’s revenue in Michigan is always understated by inventory purchases made and direct expenses incurred during the period. In the first quarter of 2021, product sales in just Michigan increased by 18% from the prior quarter, and the Company significantly increased inventory purchases to secure sufficient inventory which reduced revenue as per the licensing agreement. This timing difference in revenue will continue until the Company becomes fully licensed in Michigan. Once the Company is licensed in Michigan, the Company will be able to recognize full product sales as revenue under IFRS. As such, investors are provided adjusted sales1 for additional insight into the results of the Company’s performance.
Revenue for Q1 2021 was $11.8 million compared to $15.7 million in Q4 2020. The decrease is primarily a result of the manner in which the Company recognizes revenue under IFRS in the state of Michigan for its Platinum Vape branded product sales and a decrease of approximately $1 million due to the strengthening CDN dollar over Q4 2020.
Conference Call and Webcast Information
Management will host a conference call and audio webcast on Tuesday, July 27th, 2021 at 4:30 PM ET to give a brief overview of the Company’s 2020 and Q1 2021 operating results and its outlook for 2021 with a Q&A at the end.
The dial-in numbers for the conference call are +1 (877)-705-6006 (toll-free) and +1(201)-689-8557 (international). The link to the online webcast is: https://78449.themediaframe.com/dataconf/productusers/rwblm/mediaframe/46142/indexl.html