Planet 13 Announces Full Year 2019 Financial Results and Q1 2020 Revenue

  • 2019 Revenue of $63.6 million
  • SuperStore accounted for 9.1% of all Nevada cannabis dispensary revenue in 20191
  • 2019 EBITDA of $9.9 million
  • Q1 2020 Revenue of $16.6 million

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

LAS VEGASApril 14, 2020 /PRNewswire/ – Planet 13 Holdings Inc. (CSE: PLTH) (OTCQB: PLNHF(“Planet 13” or the “Company“), a leading vertically-integrated Nevada cannabis company, today announced financial results for the three-month and twelve-month periods ended December 31, 2019. Planet 13’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”).

Larry Scheffler, Co-CEO of Planet 13 commented, “Over the past month, businesses across the country have had to quickly adjust to the reality of COVID-19 related restrictions, and Planet 13 has been no exception. While this has impacted our day to day operations, we are approaching this challenge as an opportunity to deliver safe and responsible cannabis to our community. When cannabis dispensaries in Nevada were told to close, we pivoted to focus on our delivery business, and in only 25 days we’ve ramped our delivery service from five to twenty-eight vehicles and have shifted our customer mix from 15% local area residents, to 100%.”

Mr. Scheffler continued, “While tourism will continue to be a strong driver of our business when things return to normal, this is a unique opportunity for us to build a strong local base and gain lasting market share as we become a fixture in the daily lives of Las Vegas Valley residents.

Bob Groesbeck, Co-CEO added, “We opened Phase II of the SuperStore during Q4 and are pleased to report that as projected, it drove increased traffic, customer engagement, and higher average ticket. Through Q4, a seasonally slow period, we delivered $16.5 million in revenue. During Q1 2020, we saw the network effect of Phase II accelerate, resulting in ~$16.6 million in revenue, a 20% increase compared to Q1 of 2019, despite effects of COVID-19 starting in the middle of March. In addition, the customer-facing production facility is fully ramped up and we have begun to offer Planet 13’s portfolio of in-house brands to select third-party dispensaries on a wholesale basis.”

Financial Highlights – Q4 – 2019

Operating Results

All comparisons below are to the quarter ended December 31, 2018, unless otherwise noted

  • Revenues were $16.5 million as compared to $8.3 million, an increase of 99.8%
  • Gross profit before biological adjustments was $9.4 million or 57.1% as compared $4.2 million or 50.5%, an increase of 125.8%
  • Operating expenses, excluding non-cash compensation expense, were $7.1 million as compared to $5.8 million, an increase of 21.5%
  • Net loss before taxes of $0.9 million as compared to a net loss of $2.2 million
  • Net loss of $2.6 million as compared to a net loss of $3.1 million
  • Adjusted EBITDA of $2.5 million as compared to Adjusted EBITDA loss of $1.5 million

Balance Sheet

All comparisons below are to December 31, 2018, unless otherwise noted

  • Cash of $12.8 million as compared to $19.4 million
  • Total assets of $62.9 million as compared to $44.9 million
  • Total liabilities of $21.6 million as compared to $7.0 million

Financial Highlights – Full Year – 2019

All comparisons below are to the year ended December 31, 2018, unless otherwise noted

  • Revenues were $63.6 million as compared to $21.2 million, an increase of 200.4%
  • Gross profit before biological adjustments was $36.5 million or 57.3% as compared $10.7 million or 50.4%, an increase of 242.0%
  • Operating expenses, excluding non-cash compensation expense, were $26.8 million as compared to $11.3 million, an increase of 137.5%
  • Net income before taxes of $0.5 million as compared to a net loss of $8.4 million
  • Net loss of $6.7 million as compared to a net loss of $10.7 million
  • Adjusted EBITDA of $9.9 million as compared to Adjusted EBITDA loss of $367,874

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 and Twelve Months Ended December 31, 2019 (the “MD&A“).  

  • On November 1, 2019, Planet 13 announced the opening of the customer-facing production facility.
  • On December 16, 2019, Planet 13 announced winning U.S. Market Leader Award in Retail at MJBizCon.
  • On January 20, 2020, Planet 13 announced the opening of dosist™ shop-in-shop wellness experience.
  • On March 19, 2020, Planet 13 announced offering expanded online ordering and delivery services.
  • On March 23, 2020, Planet 13 announced 24-hour delivery service.
  • On April 13, 2020, Planet 13 announced termination of Santa Ana acquisition.

Results of Operations (Summary)

The following tables set forth consolidated statements of financial information for the three-month and twelve-month period ending December 31, 2019 and December 31, 2018. For further information regarding the Company’s financial results for these periods, please refer to the Company’s interim financial statements for the period ended December 31, 2019 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

     

NV Cannabis Ops

 

Consolidated

    
  

Three Months

 

Three Months

 

Three Months

   

Year

 

Year

 

Year

  
  

Ended

 

Ended

 

Ended

 

Percentage

 

Ended

 

Ended

 

Ended

 

Percentage

  

Dec-31-2019

 

Dec-31-2019

 

Dec-31-2018

 

Change

 

Dec-31-2019

 

Dec-31-2019

 

Dec-31-2018

 

Change

EBITDA

               

Profit (loss) before taxes

 

1,416,699

 

(914,960)

 

(2,215,973)

 

(58.7%)

 

8,422,424

 

542,664

 

(8,433,501)

 

(106.4%)

Add back:

                

   Biological asset adjustments

 

351,080

 

351,080

 

(108,084)

 

(424.8%)

 

480,181

 

480,181

 

(192,908)

 

(348.9%)

   Non-cash share based payments

 

 

1,694,370

 

367,497

 

361.1%

 

 

4,822,787

 

2,601,233

 

85.4%

   Depreciation and amortization

 

900,278

 

900,278

 

332,925

 

170.4%

 

2,845,464

 

2,845,464

 

400,116

 

611.2%

   Depreciation included in COGS

 

157,030

 

157,030

 

141,205

 

11.2%

 

286,987

 

286,987

 

258,788

 

10.9%

   Interest and non-operating expense (income)

 

329,291

 

329,291

 

(24,928)

 

(1421.0%)

 

954,960

 

954,960

 

4,998,398

 

(80.9%)

                 

EBITDA

3,154,378

 

2,517,089

 

(1,507,358)

 

267.0%

 

12,990,016

 

9,933,043

 

(367,874)

 

2800.1%

 Margin

19.1%

 

15.2%

 

(18.2%)

   

20.4%

 

15.6%

 

(1.7%)

  
            

Expressed in USD$

Three

 Months

 

Three

 Months

   

Year

 

Year

  
  

Ended

 

Ended

 

Percentage

 

Ended

 

Ended

 

Percentage

  

Dec-31-2019

 

Dec-31-2018

 

Change

 

Dec-31-2019

 

Dec-31-2018

 

Change

Revenue

           

Revenues, net of discounts

16,540,324

 

8,279,698

 

99.8%

 

63,595,036

 

21,166,755

 

200.4%

Cost of Goods Sold

(7,098,908)

 

(4,097,973)

 

73.2%

 

(27,139,658)

 

(10,507,200)

 

158.3%

Gross Profit, Before Biological Asset Adjustment

 

9,441,416

 

4,181,725

 

125.8%

 

36,455,378

 

10,659,555

 

242.0%

Gross Profit Margin %

 

57.1%

 

50.5%

   

57.3%

 

50.4%

  

Realized fair value amounts included in COGS

(695,361)

 

207,865

 

(434.5%)

 

(1,500,965)

 

(1,726,685)

 

(13.1%)

Unrealized fair value gain on growth of biological assets

344,281

 

(99,781)

 

(445.0%)

 

1,020,784

 

1,919,593

 

(46.8%)

Gross profit

 

9,090,336

 

4,289,809

 

111.9%

 

35,975,197

 

10,852,463

 

231.5%

Gross Profit Margin %

 

55.0%

 

51.8%

   

56.6%

 

51.3%

  
             

Expenses

           

General and Administrative

5,351,056

 

4,682,652

 

14.3%

 

20,269,839

 

9,583,376

 

111.5%

Sales and Marketing

1,730,301

 

1,147,636

 

50.8%

 

6,539,483

 

1,702,841

 

284.0%

Depreciation and Amortization

900,278

 

332,925

 

170.4%

 

2,845,464

 

400,116

 

611.2%

Share based payments

1,694,370

 

367,497

 

361.1%

 

4,822,787

 

2,601,233

 

85.4%

Total Expenses

9,676,005

 

6,530,710

 

48.2%

 

34,477,573

 

14,287,566

 

141.3%

             

Income (Loss) From Operations 

(585,669)

 

(2,240,901)

 

(73.9%)

 

1,497,624

 

(3,435,103)

 

(143.6%)

             

Other (Income) Expense:

            

Interest Expense, net

 

404,332

 

5,674

 

7026.0%

 

1,306,876

 

241,860

 

440.3%

Realized Foreign Exchange gain (loss)

 

 

(4,376)

 

(100.0%)

 

(1,141)

 

37,879

 

(103.0%)

RTO acquisition costs

 

 

 

na

 

 

4,702,604

 

na

Other expense (income)

 

(75,041)

 

(26,226)

 

186.1%

 

(350,775)

 

(80,285)

 

336.9%

Loss on settlement of accounts payable (Note 13(d))

 

 

 

na

 

 

96,340

 

na

Total Other Expense (Income)

 

329,291

 

(24,928)

 

(1421.0%)

 

954,960

 

4,998,398

 

(80.9%)

             

Income (loss) for the period before tax

 

(914,960)

 

(2,215,973)

 

(58.7%)

 

542,664

 

(8,433,501)

 

(106.4%)

Provision for income tax (current and deferred)

 

1,662,213

 

889,066

 

87.0%

 

7,200,997

 

2,290,203

 

214.4%

(Loss) for the period

 

(2,577,173)

 

(3,105,039)

 

(17.0%)

 

(6,658,333)

 

(10,723,704)

 

(37.9%)

             

Other Comprehensive Income (Loss)

           

Items that may be reclassified subsequently to profit/loss 

           

     Foreign exchange translation adjustment

(24,607)

 

(666,969)

   

195,213

 

(802,920)

  

Net Comprehensive (Loss) for the period

(2,601,780)

 

(3,772,008)

   

(6,463,120)

 

(11,526,624)

  

(Loss) per share for the period

            

Basic and fully diluted loss per share

 

($0.02)

 

($0.02)

   

($0.05)

 

($0.11)

  
             

Weighted Average Number of Shares Outstanding

            

Basic and fully diluted

 

135,888,982

 

128,166,081

   

134,074,476

 

95,997,827

  

Outstanding Shares

As at the date of this report, the Company had 84,451,832 common shares and 55,232,940 class A convertible, restricted voting shares issued and outstanding for a total of 139,684,772 shares outstanding.  There were 558,507 options issued and outstanding of which 250,834 have fully vested.  There were 13,572,238 warrants outstanding and 3,454,589 RSU’s outstanding of which nil RSUs had fully vested as at the date of this report.

Conference Call

Planet 13 will host a conference call on Tuesday, April 14, 2020 at 5:00 p.m. EST to discuss its third 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 14, 2020 | Time: 5:00 p.m. EST
Participant Dial-in: 416-764-8688 or 1-888-390-0546
Replay Dial-in: 416-764-8677 or 1-888-390-0541
(Available for 2 weeks)
Reference Number: 656850
Listen to webcast: https://bit.ly/3dUnQs2 

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.

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, future expansion plans.

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; fluctuations in general macroeconomic conditions; fluctuations in securities markets; expectations regarding the size of the Nevada and California cannabis markets 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 States 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 its subsidiary MM Development Company, Inc. (“MMDC”) in Nevada. Local state laws where MMDC operates permit such activities 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 are contained under the heading “Risk Factors” in the Company’s annual information form dated April 30, 2019 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,

  

2019

 

2018

Assets

    

Current Assets

    

Cash 

 

$

12,814,712

 

$

19,364,086

HST receivable

 

16,544

 

101,831

Inventories 

 

5,474,004

 

5,322,111

Biological assets 

 

514,526

 

915,177

Prepaid expenses and other current assets 

 

3,694,272

 

1,391,278

Total Current Assets

 

22,514,058

 

27,094,483

     

Property and equipment 

 

30,211,154

 

17,256,484

Right of use assets 

 

9,478,733

 

Long-term deposits and other assets 

 

694,601

 

594,339

  

40,384,488

 

17,850,823

Total Assets

 

$

62,898,546

 

$

44,945,306

     

Liabilities

    

Current Liabilities

    

Accounts payable

 

$

864,260

 

$

1,720,721

Accrued expenses

 

1,910,046

 

1,306,145

Income taxes payable

 

7,015,606

 

2,187,109

Notes payable – current portion

 

884,000

 

884,000

Current portion of lease liabilities 

 

 

14,459

Total Current Liabilities

 

10,673,912

 

6,112,434

     

Long -term lease liabilities 

 

10,522,377

 

29,768

Deferred rent 

 

 

427,508

Other long-term liabilities

 

28,000

 

Deferred tax liability

 

379,665

 

470,856

  

10,930,042

 

928,132

Total Liabilities

 

21,603,954

 

7,040,566

     

Shareholders’ Equity

    

Share capital 

 

51,986,849

 

42,460,824

Restricted share units

 

4,119,485

 

2,800,335

Warrants 

 

5,961,091

 

7,046,843

Option reserve 

 

399,439

 

305,890

Accumulated other comprehensive loss

 

(607,707)

 

(802,920)

Deficit

 

(20,564,565)

 

(13,906,232)

Total Shareholders’ Equity

 

41,294,592

 

37,904,740

Total Liabilities and Shareholders’ Equity

 

$

62,898,546

 

$

44,945,306

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

         

Expressed in United States Dollars

 

Year

 

Year

 

Three months

 

Three months

  

Ended

 

Ended

 

Ended

 

Ended

  

December 31,

 

December 31,

 

December 31,

 

December 31,

  

2019

 

2018

 

2019

 

2018

Revenue

        

Revenues, net of discounts

 

$

63,595,036

 

$

21,166,755

 

$

16,540,324

 

$

8,279,698

Cost of Goods Sold 

 

(27,139,658)

 

(10,507,200)

 

(7,098,908)

 

(4,097,973)

Gross Profit before fair value asset adjustment

 

36,455,378

 

10,659,555

 

9,441,416

 

4,181,725

Realized fair value amounts included in inventory sold

 

(1,500,965)

 

(1,726,685)

 

(695,361)

 

207,865

Unrealized fair value gain on growth of biological assets

 

1,020,784

 

1,919,593

 

344,281

 

(99,781)

Gross Profit

 

35,975,197

 

10,852,463

 

9,090,336

 

4,289,809

         

Expenses

        

General and Administrative 

 

20,269,839

 

9,583,376

 

5,351,056

 

4,682,652

Sales and Marketing

 

6,539,483

 

1,702,841

 

1,730,301

 

1,147,636

Depreciation and Amortization 

 

2,845,464

 

400,116

 

900,278

 

332,925

Share-Based Compensation Expense 

 

4,822,787

 

2,601,233

 

1,694,370

 

367,497

Total Expenses

 

34,477,573

 

14,287,566

 

9,676,005

 

6,530,710

         

Income (Loss) From Operations 

 

1,497,624

 

(3,435,103)

 

(585,669)

 

(2,240,901)

         

Other Expense:

        

Interest expense, net

 

1,306,876

 

241,860

 

404,332

 

5,674

Realized foreign exchange (gain) loss

 

(1,141)

 

37,879

 

 

(4,376)

Other income

 

(350,775)

 

(80,285)

 

(75,041)

 

(26,226)

RTO listing expense 

 

 

4,702,604

 

 

Loss on settlement of accounts payable

 

 

96,340

 

 

Total Other Expense

 

954,960

 

4,998,398

 

329,291

 

(24,928)

         

Income (Loss) before income taxes

 

542,664

 

(8,433,501)

 

(914,960)

 

(2,215,973)

Provision for tax – current 

 

7,292,188

 

2,198,295

 

1,402,227

 

909,107

Provision for tax – deferred

 

(91,191)

 

91,908

 

259,986

 

(20,041)

Net (loss) for the Year

 

$

(6,658,333)

 

$

(10,723,704)

 

$

(2,577,173)

 

$

(3,105,039)

         

Other Comprehensive Income (Loss)

        
         

     Foreign exchange translation gain (loss)

 

195,213

 

(802,920)

 

(24,607)

 

(666,969)

Net Comprehensive  (Loss) for the Year

 

$

(6,463,120)

 

$

(11,526,624)

 

$

(2,601,780)

 

$

(3,772,008)

         

Loss per share for the Year

        

Basic and diluted loss per share 

 

($0.05)

 

($0.11)

 

($0.02)

 

($0.02)

         

Weighted Average Number of Common Shares Outstanding

        

Basic and Diluted (Note 17)

 

134,074,476

 

95,997,827

 

135,888,982

 

128,166,081

         

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

     

Expressed in United States Dollars

 

Year

 

Year

  

Ended

 

Ended

  

December 31,

 

December 31,

  

2019

 

2018

Operating activities

    

Net (loss) for the year

 

$

(6,658,333)

 

$

(10,723,704)

Add (deduct) non-cash items:

    

Share based payments 

 

4,822,787

 

2,601,233

Depreciation and amortization 

 

3,607,286

 

988,768

  Write-off of fixed assets duringthe year

 

82,882

 

Loss on settlement of accounts payable

 

 

96,340

Share base payment to Carpincho shareholders on RTO

 

 

4,040,637

Deferred tax liability 

 

(91,191)

 

91,908

Realized foreign exchange (gain) loss

 

 

37,879

Interst on lease  liabilities

 

1,367,759

 

Non-cash interest expense

 

 

217,048

     

Net change in non-cash working capital

    

HST receivable

 

85,287

 

(101,831)

Inventories 

 

(151,893)

 

(3,618,283)

Biological assets 

 

400,651

 

152,129

Prepaid expenses and other assets 

 

(2,426,866)

 

(1,299,148)

Long term deposits and other assets

 

(100,262)

 

(594,339)

Accounts payable 

 

(856,462)

 

798,672

Accrued expenses

 

603,902

 

250,318

Income tax payable

 

4,828,497

 

927,433

Other liabilities

 

28,000

 

427,508

Cash flow provided by (used in) operating activities

 

5,542,044

 

(5,707,432)

     

Investing activities

    

Net cash acquired on acquisition

 

 

34,678

Purchase of property, plant and equipment 

 

(16,061,582)

 

(13,313,401)

Cash flow used in investing activities

 

(16,061,582)

 

(13,278,723)

     

Financing activities

    

Issuance of common shares and warrants 

 

 

40,381,022

Issuance of shares on warrant and option exercises 

 

5,030,185

 

2,374,253

Share and warrant issuance costs

 

 

(4,032,025)

Principal and interest payment on lease liabilities

 

(1,247,546)

 

(11,845)

Cash flow provided by financing activities

 

3,782,639

 

38,711,405

     

Net increase (decrease) in cash 

 

(6,736,899)

 

19,725,250

Cash  at beginning of the year

 

19,364,086

 

451,869

Effect of foreign exchange on cash

 

187,525

 

(813,033)

Cash at end of the year

 

$

12,814,712

 

$

19,364,086

SOURCE Planet 13 Holdings Inc.

Related Links

https://planet13lasvegas.com/

 

 

Original Press Release