Creso Pharma
Planet 13 Announces Full Year 2020 Financial Results and Q1 2021 Revenue
  • Q1 2021 Revenue of $23.8 million, including $9.7 million in March
  • 2020 Revenue of $70.5 million
  • Planet 13 accounted for 8.2% of all Nevada cannabis dispensary revenue in Q4
  • 2020 EBITDA of $8.9 million

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

LAS VEGAS, NV / ACCESSWIRE / April 5, 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 and twelve-month period ended December 31, 2020. Planet 13’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”).

“Based on our performance in March 2021, it is clear that Las Vegas is back.” Said Larry Scheffler, Co-CEO of Planet 13. “We dwarfed our single month record with $9.7 million in revenue in March, and we believe that as more people get vaccinated and Las Vegas continues to open, revenue will continue to increase. Looking back on 2020, we weathered the perfect storm of COVID-19 and the resulting 55% decrease in tourism and still increased revenue year over year, generating over $70 million while maintaining our share of the Nevada market.”


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“With the rapid turn-around we’ve seen in Q1 and especially in March, it is clear that the improvements we made over the last year will pay dividends as normalcy returns to Las Vegas,” commented Bob Groesbeck, Co-CEO of Planet 13. “With tourism back on track, the SuperStore is performing well. Furthermore, our local-focused offerings including Medizin, curbside and delivery, and wholesale are helping us take a greater share of that market. Outside of Las Vegas, the Orange County SuperStore in California is on track and on budget for our projected opening in July. We poured everything we learned from two years running the greatest cannabis store in the world, into our Orange County location and are confident that this store will redefine the cannabis retail experience in California.”

Financial Highlights – Q4 – 2020

Operating Results

All comparisons below are to the quarter ended December 31, 2019, unless otherwise noted

  • Revenues were $20.1 million as compared to $16.5 million, an increase of 21.8%
  • Gross profit before biological adjustments was $7.5 million or 37.1% as compared to $9.4 million or 57.1%
  • Operating expenses, excluding non-cash compensation expense and depreciation and amortization, was $8.0 million as compared to $7.1 million, an increase of 13.1%
  • Net loss before taxes of $1.2 million as compared to a net loss of $0.9 million
  • Net loss of $2.9 million as compared to a net loss of $2.6 million
  • Adjusted EBITDA of $0.3 million as compared to Adjusted EBITDA of $2.6 million

Balance Sheet

All comparisons below are to December 31, 2019, unless otherwise noted

  • Cash of $79.0 million as compared to $12.8 million
  • Total assets of $150.0 million as compared to $62.9 million
  • Total liabilities of $29.3 million as compared to $21.6 million

Financial Highlights – Full Year – 2020

All comparisons below are to the year ended December 31, 2019, unless otherwise noted

  • Revenues were $70.5 million as compared to $63.6 million, an increase of 10.8%
  • Gross profit before biological adjustments was $34.2 million or 48.5% as compared $36.5 million or 57.3%
  • Operating expenses, excluding non-cash compensation expense, were $28.0 million as compared to $26.8 million, an increase of 4.3%
  • Net loss before taxes of $0.8 million as compared to a net profit of $0.5 million
  • Net loss of $7.9 million as compared to a net loss of $6.7 million
  • Adjusted EBITDA of $8.9 million as compared to Adjusted EBITDA of $10.2 million

Q4 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 and Twelve Months Ended December 31, 2020 (the “MD&A“).

  • On October 13, 2020, Planet 13 announced the addition of non-cannabis retail space to the Las Vegas SuperStore.
  • On October 19, 2020, Planet 13 announced expanding the dispensary floor of the Las Vegas SuperStore.
  • On October 19, 2020, Planet 13 announced a CDN$20 million bought deal public offering.
  • On October 20, 2020, Planet 13 announced an upsize to bought deal public offering to CDN$25 million.
  • On November 5, 2020, Planet 13 announced the closing of a CDN$28.8 million bought deal public offering.
  • On November 20, 2020, Planet 13 announced opening the Medizin dispensary.
  • On November 27, 2020, Planet 13 announced second closing under its asset purchase agreement.
  • On December 10, 2020, Planet 13 announced winning multiple awards at Las Vegas Jack Herer Cup.
  • On January 12, 2021, Planet 13 announced a CDN$50 million bought deal and upsizeing.
  • On February 2, 2021, Planet 13 announced closing of CDN$69 million bought deal.
  • 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.

Results of Operations (Summary)

The following tables set forth consolidated statements of financial information for the three-month and twelve-month periods ending December 31, 2020 and December 31, 2019. 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 December 31, 2020 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           NV Cannabis Ops     Consolidated              
  Three Months     Three Months     Three Months           Year     Year     Year        
  Ended     Ended     Ended     Percentage     Ended     Ended     Ended     Percentage  
  Dec-31-2020     Dec-31-2020     Dec-31-2019     Change     Dec-31-2020     Dec-31-2020     Dec-31-2019     Change  

EBITDA

                                               

Profit (loss) before taxes

    (227,795 )     (1,238,771 )     (914,960 )     35.4 %     4,896,181       (849,268 )     542,664       (256.5 %)

Add back:

                                                               

Biological asset adjustments

    (1,396,910 )     (1,396,910 )     351,080       (497.9 %)     (1,171,616 )     (1,171,616 )     480,181       (344.0 %)

Non-cash share based payments

          506,501       1,694,370       (70.1 %)           2,512,568       4,822,787       (47.9 %)

Depreciation and amortization

    1,051,894       1,051,894       900,278       16.8 %     4,155,741       4,155,741       2,845,464       46.0 %

Depreciation included in COGS

    517,177       517,177       157,026       229.4 %     1,900,288       1,900,288       472,661       302.0 %

ROU Interest included in COGS

    325,718       325,718       35,524               783,318       783,318       121,257          

Interest and non-operating expense (income)

    538,047       538,047       329,291       63.4 %     1,579,784       1,579,792       954,960       65.4 %
                                                               

EBITDA

    808,131       303,656       2,552,609       (88.1 %)     12,143,696       8,910,823       10,239,974       (13.0 %)

Margin

    4.0 %     1.5 %     15.4 %             17.2 %     12.6 %     16.1 %        
                                                                 
                                     

Expressed in USD$

  Three Months     Three Months           Year     Year        
  Ended     Ended     Percentage     Ended     Ended     Percentage  
  Dec-31-2020     Dec-31-2019     Change     Dec-31-2020     Dec-31-2019     Change  

Revenue

                                   

Revenues, net of discounts

    20,139,944       16,540,324       21.8 %     70,491,280       63,595,036       10.8 %

Cost of Goods Sold

    (12,670,805 )     (7,098,908 )     78.5 %     (36,291,251 )     (27,139,658 )     33.7 %

Gross Profit, Before Biological Asset Adjustment

    7,469,139       9,441,416       (20.9 %)     34,200,029       36,455,378       (6.2 %)

Gross Profit Margin %

    37.1 %     57.1 %             48.5 %     57.3 %        

Realized fair value amounts included in COGS

    377,903       (695,361 )     (154.3 %)     (1,104,525 )     (1,500,965 )     (26.4 %)

Unrealized fair value gain on growth of biological assets

    1,019,007       344,281       196.0 %     2,276,141       1,020,784       123.0 %

Gross profit

    8,866,049       9,090,336       (2.5 %)     35,371,645       35,975,197       (1.7 %)

Gross Profit Margin %

    44.0 %     55.0 %             50.2 %     56.6 %        
                                               

Expenses

                                               

General and Administrative

    7,386,914       5,351,056       38.0 %     24,667,172       20,269,839       21.7 %

Sales and Marketing

    621,464       1,730,301       (64.1 %)     3,305,640       6,539,483       (49.5 %)

Depreciation and Amortization

    1,051,894       900,278       16.8 %     4,155,741       2,845,464       46.0 %

Share based payments

    506,501       1,694,370       (70.1 %)     2,512,568       4,822,787       (47.9 %)

Total Expenses

    9,566,773       9,676,005       (1.1 %)     34,641,121       34,477,573       0.5 %
                                               

Income (Loss) From Operations

    (700,724)       (585,669)       19.6 %     730,524       1,497,624       (51.2 %)
                                               

Other (Income) Expense:

                                               

Interest Expense, net

    504,692       404,332       24.8 %     1,796,641       1,306,876       37.5 %

Realized Foreign Exchange gain (loss)

              na             (1,141 )     (100.0 %)

Other expense (income)

    33,355       (75,041 )     (144.4 %)     (216,849 )     (350,775 )     (38.2 %)

Total Other Expense (Income)

    538,047       329,291       63.4 %     1,579,792       954,960       65.4 %
                                               

Income (loss) for the period before tax

    (1,238,771)       (914,960)       35.4 %     (849,268)       542,664       (256.5 %)

Provision for income tax (current and deferred)

    1,666,546       1,662,213       0.3 %     7,092,257       7,200,997       (1.5 %)

Income (Loss) for the period

    (2,905,317)       (2,577,173)       12.7 %     (7,941,525)       (6,658,333)       19.3 %
                                               

Other Comprehensive Income (Loss)

                                               

Items that may be reclassified subsequently to profit/loss

                                               

Foreign exchange translation adjustment

    333,528       (24,607 )             128,585       195,213          

Net Comprehensive Income (Loss) for the period

    (2,571,789)       (2,601,780)               (7,812,940)       (6,463,120)          

Income (Loss) per share for the period

                                               

Basic and fully diluted loss per share

  $ (0.02)     $ (0.02)             $ (0.05)     $ (0.05)          
                                               

Weighted Average Number of Shares Outstanding

                                               

Basic and fully diluted

    175,660,734       135,888,982               151,825,439       134,074,476          
                                                 

Outstanding Shares

As of April 5, 2021, the Company had 140,330,574 common shares and 55,232,940 class A convertible, restricted voting shares issued and outstanding for a total of 195,563,514 shares outstanding. There were 184,168 options issued and outstanding of which all have fully vested. There were 9,700,341 warrants outstanding and 912,095 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 Monday, April 5, 2021 at 5:00 p.m. EST to discuss its fourth 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: April 5, 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: 40511
Listen to webcast: https://bit.ly/393yrjE

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  
  December 31,     December 31,  
  2020     2019  

Assets

           

Current Assets

           

Cash

  $ 79,000,850     $ 12,814,712  

HST receivable

    103,445       16,544  

Inventories (Note 6)

    7,334,717       5,474,004  

Biological assets (Note 7)

    640,995       514,526  

Prepaid expenses and other current assets (Note 11)

    2,637,547       3,694,272  

Total Current Assets

    89,717,554       22,514,058  
               

Property and equipment (Note 8)

    32,073,925       30,211,154  

Licenses (Note 9)

    7,007,362        

Right of use assets (Note 10)

    20,149,721       9,478,733  

Long-term deposits and other assets

    1,054,443       694,601  
    60,285,451       40,384,488  

Total Assets

  $ 150,003,005     $ 62,898,546  
               

Liabilities

               

Current Liabilities

               

Accounts payable

  $ 1,683,833     $ 864,260  

Accrued expenses

    2,844,714       1,910,046  

Income taxes payable

    1,220,652       7,015,606  

Notes payable – current portion (Note 12)

    884,000       884,000  

Total Current Liabilities

    6,633,199       10,673,912  
               

Long -term lease liabilities (Note 13)

    22,326,077       10,522,377  

Other long-term liabilities

    28,000       28,000  

Deferred tax liability (Note 19)

    313,422       379,665  
    22,667,499       10,930,042  

Total Liabilities

    29,300,698       21,603,954  
               

Shareholders’ Equity

               

Share capital (Note 14)

    139,177,034       51,986,849  

Restricted share units (Note 14)

    3,262,351       4,119,485  

Warrants (Note 14)

    6,972,053       5,961,091  

Option reserve (Note 14)

    276,081       399,439  

Accumulated other comprehensive loss

    (479,122 )     (607,707 )

Deficit

    (28,506,090 )     (20,564,565 )

Total Shareholders’ Equity

    120,702,307       41,294,592  

Total Liabilities and Shareholders’ Equity

  $ 150,003,005     $ 62,898,546  
                 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)

                         

Expressed in United States Dollars

  Three months     Three months     Year     Year  
  Ended     Ended     Ended     Ended  
  December 31,     December 31,     December 31,     December 31,  
  2020     2019     2020     2019  

Revenue

                       

Revenues, net of discounts

  $ 20,139,944     $ 16,540,324     $ 70,491,280     $ 63,595,036  

Cost of Goods Sold

    (12,670,805 )     (7,098,908 )     (36,291,251 )     (27,139,658 )

Gross Profit before fair value asset adjustment

    7,469,139       9,441,416       34,200,029       36,455,378  

Realized fair value amounts included in inventory sold

    377,903       (695,361 )     (1,104,525 )     (1,500,965 )

Unrealized fair value gain on growth of biological assets

    1,019,007       344,281       2,276,141       1,020,784  

Gross Profit

    8,866,049       9,090,336       35,371,645       35,975,197  
                               

Expenses

                               

General and Administrative (Note 15)

    7,386,914       5,351,056       24,667,172       20,269,839  

Sales and Marketing

    621,464       1,730,301       3,305,640       6,539,483  

Depreciation and Amortization (Note 8 & 10)

    1,051,894       900,278       4,155,741       2,845,464  

Share-Based Compensation Expense (Note 14 and Note 18)

    506,501       1,694,370       2,512,568       4,822,787  

Total Expenses

    9,566,773       9,676,005       34,641,121       34,477,573  
                               

Income From Operations

    (700,724)       (585,669)       730,524       1,497,624  
                               

Other Expense:

                               

Interest expense, net

    504,692       404,332       1,796,641       1,306,876  

Realized foreign exchange loss

                      (1,141 )

Other income

    33,355       (75,041 )     (216,849 )     (350,775 )

Total Other Expense

    538,047       329,291       1,579,792       954,960  
                               

Income (Loss) before income taxes

    (1,238,771)       (914,960)       (849,268)       542,664  

Provision for tax – current (Note 19)

    1,817,805       1,402,227       7,158,500       7,292,188  

Provision for tax – deferred (Note 19)

    (151,259 )     259,986       (66,243 )     (91,191 )

Loss for the year

  $ (2,905,317)     $ (2,577,173)     $ (7,941,525)     $ (6,658,333)  
                               

Other Comprehensive Income

                               
                               

Foreign exchange translation gain

    333,528       (24,607 )     128,585       195,213  

Net Comprehensive Loss for the year

  $ (2,571,789)     $ (2,601,780)     $ (7,812,940)     $ (6,463,120)  
                               

Loss per share for the year

                               

Basic and diluted loss per share (Note 16)

  $ (0.02)     $ (0.02)     $ (0.05)     $ (0.05)  
                               

Weighted Average Number of Common Shares Outstanding

                               

Basic and Diluted

    175,660,734       135,888,982       151,825,439       134,074,476  
                                 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

             

Expressed in United States Dollars

  Year     Year  
  Ended     Ended  
  December 31,     December 31,  
  2020     2019  

Operating activities

           

Net loss for the year

  (7,941,525 )   (6,658,333 )

Add (deduct) non-cash items:

               

Share based payments (Note 14 and 18)

    2,512,568       4,822,787  

Depreciation and amortization (Note 8 and 10)

    6,056,031       3,607,286  

Deferred tax liability

    (66,243 )     (91,191 )

Write-off of fixed assets during the year

          82,882  

Non-cash interest expense on ROU Liabilities (Note 13)

    2,559,047       1,367,759  
               

Net change in non-cash working capital

               

HST receivable

    (91,533 )     85,287  

Inventories (Note 6)

    (227,841 )     (151,893 )

Biological assets (Note 7)

    (126,469 )     400,651  

Prepaid expenses and other assets (Note 11)

    1,178,734       (2,426,866 )

Long term deposits and other assets

    (359,842 )     (100,262 )

Accounts payable

    452,393       (856,462 )

Accrued expenses

    934,669       603,902  

Income tax payable

    (5,794,954 )     4,828,497  

Other long-term liabilities

          28,000  

Cash flow provided by (used in) operating activities

    (914,965)       5,542,044  
               

Investing activities

               

Purchase of property, plant and equipment (Note 8)

    (4,481,058 )     (16,061,582 )

Purchase of licenses (Note 9)

    (3,550,400 )      

Cash flow used in investing activities

    (8,031,458)       (16,061,582)  
               

Financing activities

               

Issuance of shares on warrant and option exercises (Note 14)

    32,871,439       5,030,185  

Issuance of shares and warrants on financings

    44,464,540        

Payment on lease liabilities

    (2,337,006 )     (1,247,546 )

Cash flow provided by financing activities

    74,998,973       3,782,639  
               

Net increase in cash

    66,052,550       (6,736,899)  

Cash at beginning of the year

    12,814,712       19,364,086  

Effect of foreign exchange on cash

    133,588       187,525  

Cash at end of the year

  79,000,850     12,814,712  
                 

SOURCE: Planet 13 Holdings Inc.