- Reiterates financial guidance for positive Adjusted EBITDA1 profitability in 2022
- Completion of BC Hydro power upgrade
- Maintains strong premium market position of 8.6%2 market share nationally
VANCOUVER, British Columbia, Sept. 19, 2022 (GLOBE NEWSWIRE) -- Rubicon Organics Inc. (TSXV: ROMJ) (OTCQX: ROMJF) (“Rubicon Organics” or the “Company”), a licensed producer focused on cultivating and selling organic certified, premium cannabis, is pleased to provide a corporate and operational update for the period ending August 31, 2022.
Corporate Update
The Company is pleased to reiterate its financial guidance from August 15, 2022 with its current expectation to be operating cashflow positive and Adjusted EBITDA profitable in fiscal 2022. As previously reported, the Company achieved positive Adjusted EBITDA in the three months ended June 30, 2022. We believe that our increased product quality and brand portfolio has positioned Rubicon to deliver on its commitments and win in the premium cannabis market in Canada.
“Every product in Rubicon Organics’ portfolio delivers positive gross profit and our financial discipline as well as cost saving initiatives, such as the BC Hydro power upgrade, are driving us to our first full year of Adjusted EBITDA profitability,” said Margaret Brodie, Chief Financial Officer.
In addition, the Board of Directors of the Company has now begun its search of internal and external candidates for a Chief Executive Officer successor who can lead the Company in driving forward its vision to be the global brand leader in premium organic cannabis.
Operational Update
Delta Facility Power Upgrade
The Company’s fully licensed 125,000 sq. ft. glass-roofed facility in Delta, BC (the “Delta Facility”) has been successfully connected to the BC Hydro power grid. This power grid connection to the Delta Facility eliminates the need for the daily operation of natural gas generators, reduces the Company’s operating costs and further contributes to one of our Environmental, Social and Governance (“ESG”) goals to reduce greenhouse gas emissions. The Company is in the process of purchasing a backup generator capable of supporting all key operational systems in the event of a power outage.
Premium Market Share
For the three months ending August 31, 2022, the Company achieved total market share of 8.6%2 in the premium flower and pre-roll category across Canada. In 2022, we have now consistently seen our average THC increase significantly, with certain strains as high as 29% THC. We believe that our quality step change in market since the spring has been experienced by our consumers and has led to the strong rate of sales and resulting increase in revenue. Our priority and focus remains delivering super-premium quality cannabis flower and pre-rolls as the key pillar of Rubicon’s business.
The growth in the premium segment of the cannabis market in Canada continues to outpace the growth in the overall cannabis industry3 and Rubicon is seeking to capitalize on this trend with its new product launches across markets in September and October 2022.
Furthermore, according to Hifyre, Simply Bare™ Organic continues to rank as the #1 premium brand4 by sales of flower and pre-roll products across Canada for the twelve months ending August 31, 2022.
ABOUT RUBICON ORGANICS INC.
Rubicon Organics Inc. is the global brand leader in premium organic cannabis products. The Company is vertically integrated through its wholly owned subsidiary Rubicon Holdings Corp, a licensed producer. Rubicon Organics is focused on achieving industry leading profitability through its premium cannabis flower, product innovation and brand portfolio management, including its flagship super-premium brand Simply Bare™ Organic, its premium flower and hash brand 1964 Supply Co.™, its premium concentrate brand Lab Theory™, and its mainstream brand Homestead Cannabis Supply™.
The Company ensures the quality of its supply chain by cultivating, processing, branding and selling organic certified, sustainably produced, super-premium cannabis products from its state-of-the-art glass roofed facility located in Delta, BC, Canada.
CONTACT INFORMATION
Margaret Brodie
Chief Financial Officer
Phone: +1 (437) 929-1964
Email: ir@rubiconorganics.com
Cautionary Statement Regarding Forward Looking Information
This press release contains forward-looking information within the meaning of applicable securities laws. All statements that are not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs of future performance, statements regarding Rubicon Organics' goal of achieving industry leading profitability are "forward-looking statements". Forward-looking information can be identified by the use of words such as “will” or variations of such word or statements that certain actions, events or results "will" be taken, occur or be achieved. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward looking statements. The forward-looking information in this press release is based upon certain assumptions that management considers reasonable in the circumstances, including the ability of the Company to achieve operating cashflow positive and Adjusted EBITDA profitability in fiscal 2022, the effective date of the resignation and the ability attract and retain a new CEO. Risks and uncertainties associated with the forward looking information in this press release include, among others, dependence on obtaining and maintaining regulatory approvals, including acquiring and renewing federal, provincial, local or other licenses and any inability to obtain all necessary governmental approvals licenses and permits for construction at its facilities in a timely manner; regulatory or political change such as changes in applicable laws and regulations, including bureaucratic delays or inefficiencies or any other reasons; any other factors or developments which may hinder market growth; Rubicon Organics' limited operating history and lack of historical profits; reliance on management; and the effect of capital market conditions and other factors on capital availability; competition, including from more established or better financed competitors; and the need to secure and maintain corporate alliances and partnerships, including with customers and suppliers; and the effects of the COVID-19 pandemic. These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. Although Rubicon Organics has attempted to identify important risk factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other risk factors that cause actions, events or results to differ from those anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. Rubicon Organics assumes no obligation to update any forward-looking statement, even if new information becomes available as a result of future events, new information or for any other reason except as required by law.
Non-GAAP Financial Measures
This press release contains certain financial performance measures that are not recognized or defined under IFRS (“Non-GAAP Measures”) including, but not limited to, “Adjusted EBITDA”. As a result, this data may not be comparable to data presented by other companies. The Company believes that these Non-GAAP Measures are useful indicators of operating performance and are specifically used by management to assess the financial and operational performance of the Company. Accordingly, they should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. For more information, please refer to the “Selected Financial Information” section in the MD&A for the three and six months ended June 30, 2022, which is available on SEDAR at www.sedar.com.
The Company’s quantitative reconciliation of Adjusted EBITDA is calculated as earnings (losses) from operations before interest, tax, depreciation and amortization, share-based compensation expense, and fair value changes. A table of the most recent reconciliation of reconciliation of Adjusted EBITDA to the most comparable IFRS financial measure for the three and six months ended June 30, 2022 and June 30, 2021 is available in Management’s Discussion & Analysis as at June 30, 2022.
1 Adjusted EBITDA is a non-GAAP measure that is calculated as earnings (losses) from operations before interest, tax, depreciation and amortization, share-based compensation expense, and fair value changes. See ‘Non-GAAP Financial Measures’ at the end of this press release for details
2 Hifyre data for premium flower and pre-rolls between June 1, 2022 and August 31, 2022
3 Hifyre data for all categories of cannabis products versus premium cannabis products for the period of September 1, 2021 to August 31, 2022
4 HiFyre data for premium flower and pre-rolls between September 1, 2021 and August 31, 2022
