Vext Announces Financial Results for Q1 2023

  • Revenue of $9.1 million, Adjusted EBITDA of $2.9 million, Adjusted EBITDA Margin of 32%.
  • Generated positive EBITDA of $1.6 million.
  • Expanded retail footprint through the acquisition of Jackson, Ohio dispensary and reported solid performance during first quarter under Vext ownership.
  • Previously announced acquisition of vertically integrated Ohio operations on track to close towards the end of Q3 2023 and expected to bring continued growth for Vext in 2023.

Vancouver, British Columbia–(Newsfile Corp. – May 25, 2023) – Vext Science, Inc. (CSE: VEXT) (OTCQX: VEXTF) (“VEXT” or the “Company”) a U.S.-based cannabis operator with vertical operations in Arizona and Ohio1, today reported its financial results for the period ended March 31, 2023. All currency references used in this news release are in U.S. currency unless otherwise noted.

Summary Financial Results

Q1 2023Q4 2022Q1 2022
Gross margin before impact of biological assets (%) 251%50%60.6%
Adjusted Gross Margin (%) 2,351%50%53%
EBITDA 2$1,638,009$2,479,885$5,610,739
Adjusted EBITDA 2$2,930,919$3,180,835$3,811,589
Adjusted EBITDA margin (%) 232%39%35%

Management Commentary

Eric Offenberger, CEO of Vext, commented, “The first quarter of 2023 marked a solid start to the year for Vext in the context of a challenging environment across the board for consumer-facing businesses. In Arizona, the state reported a ~15% decrease in overall sales in the first two months of the year, as compared to the same period in 2022. Despite these challenges, our operated dispensaries outperformed the overall state average. Our team has been successful at driving higher traffic and maintaining a recurring customer base, to help compensate for lower average basket sizes, as consumers continue to watch their discretionary spending. Vext’s vertically integrated operations, where we only cultivate flower that we can sell through our own retail footprint, our focus on efficient retail operations and our proven track record of driving efficiencies set the Company up well both through this period, as well as for growth as the economic backdrop improves.”

“For the remainder of the year, we will continue to focus on strengthening our presence in Arizona and preparations to close the acquisition of vertical operations in Ohio1, which we see as the next major growth opportunity for Vext, given its limited license structure and potential for future adult-use transition. Our strong balance sheet and proven experience as a profitable operator positions us well to continue to gain market share across our footprint, while building value for shareholders,” added Mr. Offenberger.

Q1 2023 Financial Results Conference Call

Vext will host a conference call and webcast on Thursday, May 25, 2023 at 8:00 a.m. ET to discuss its first quarter financial results.

Date: May 25, 2023 | Time: 8:00am ET
Participant Dial-in: 416-915-3239 or 1-800-319-4610
Replay Dial-in: 1-800-319-6413
Conference ID: 10021826
Playback #: 0139 (Expires on June 8, 2023)
Listen to webcast:

For more details, visit Vext’s investor website or contact the IR team at

Non-IFRS Financial Measure

The Company has provided certain non-IFRS financial measures including “Gross margin”, “Adjusted Gross Margin”, “EBITDA”, “Adjusted EBITDA” and “Adjusted EBITDA margin”. These non-IFRS financial measures do not have a standardized definition under IFRS, nor are they calculated or presented in accordance with IFRS and may not be comparable to similar measures presented by other companies. The Company defines “Gross margin” as Gross Profit divided by Revenue and “Adjusted Gross Margin” as Gross margin before the impact of biological assets, as adjusted for one-time inventory fair value adjustment, divided by Revenue. The Company defines EBITDA as earnings before interest, taxes, depreciation and amortization. The Company defines “Adjusted EBITDA” as net income (loss) from operations, as reported, before interest and tax, adjusted to exclude extraordinary items, non-recurring items, other non-cash items, including stock-based compensation expense, depreciation and amortization, foreign exchange and acquisition related costs, if applicable. The Company defines “Adjusted EBITDA margin” as Adjusted EBITDA divided by Revenue.

The Company has provided these non-IFRS financial measures as supplemental information and in addition to the financial measures that are calculated and presented in accordance with IFRS. The Company believes that these supplemental non-IFRS financial measures provide a valuable additional measure to use when analyzing the operating performance of the business. These supplemental non-IFRS financial measures should not be considered superior to, as a substitute for or as an alternative to, and should only be considered in conjunction with, the IFRS financial measures presented herein.

The following information provides reconciliations of the supplemental non-IFRS financial measure presented herein to the most directly comparable financial measure calculated and presented in accordance with IFRS.

Gross Margin Before Impact of Biological Assets and Adjusted Gross Margin

Gross Margin Before Impact of Biological Assets is defined as: Gross Profit Before Impact of Biological Assets, divided by Revenue.

Adjusted Gross Margin is defined as: Gross Margin Before Impact of Biological Assets, adjusted for one-time inventory fair value adjustment, divided by Revenue.

Q1 2023
Gross Profit$4,701,716
Change in Fair Value of Biological Assets($59,623)
Gross Profit Before Impact of Biological Assets$4,642,093
Relative fair value adjustment to inventory
Adjusted Gross Profit$4,642,093
Adjusted Gross Margin51%

Adjusted EBITDA

Q1 2023Q4 2022Q1 2022
Net Income after taxes$73,059$6,282,582$2,260,957
Interest (Net)$860,978$632,207$337,888
Income Taxes($1,141,064)($6,209,576)$1,475,051
Depreciation & Amortization$1,845,036$1,774,672$1,536,843
Accretion($6,026)$ –$12,372
Share (Profit) / Loss on JVs$91,205$40,256$182,145
Share-based compensation$130,332$601,493$85,696
(Gain)/Loss on Asset Disposal$ –($13,127)$ –
Gain on derecognition of ROU$ –$ –$ –
(Gain)/Loss on Investment$ –$ –$ –
Loan modification non-convertible debentures$ –$200,170$ –
Loan Costs WPCU Loan$742,036$ –$ –
FV of WPCU Loan$190,984$ –$ –
Loan Costs EWB Amortized$125,451$ –$ –
Other Income$ –$ –$ –
RSU Taxes$75,825$119,900$ –
Foreign Exchange$2,726($350)($212)
Relative FV adjustment to inventory$ –$ –($863,000)
Change in FV of Biological($59,623)($247,392)($1,216,152)
Adjusted EBITDA$2,930,919$3,180,835$3,811,589
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