- 2021 Revenue of $9.4M compared to $4.3M in 2020, an increase of 121%
- 2021 Gross Profit of $5.2M (56% margin), before fair value adjustments, compared to $1.8M (43% margin) in 2020, an increase of 188% and 1300 basis points
- 2021 aEBITDA1 of $2.2M (24% margin) compared to $0.3M (6% margin) in 2020, an increase of 797% and 1800 basis points
- 2021 cash flow from operations, before changes in working capital, of $1.9M compared to ($0.2M) in 2020
- Q4 2021 contributed $1.2M of aEBITDA1 and $0.9M of cash flow from operations, before changes in working capital, as efficiencies and added production were realized
- Michigan operations (through Golden Harvests, LLC) report industry leading gross margin of 73% (before fair value adjustments) and segmented aEBITDA1 margin of 58%
MEDFORD, Ore.--(BUSINESS WIRE)--Grown Rogue International Inc. (“Grown Rogue” or the “Company”) (CSE: GRIN) (OTC: GRUSF), a multi-state cannabis company with operations and assets in Oregon and Michigan, reports audited results for the fiscal year ended October 31, 2021. All financial information is provided in U.S. dollars unless otherwise indicated.
2021 Highlights
- Positive aEBITDA for eighth consecutive quarters, including pro-forma results2
- Increased indoor whole flower production from 400 pounds/month in Q1 2021 to 1250/month in Q4 2021
- Launched branded 1/8oz flower bags and our patented nitrogen sealed jars in Michigan market
- Fastest growing brand in Oregon in September and October, according to LeafLink
- Exited calendar 2021 as a top 10 flower wholesaler in Michigan, according to LeafLink’s MarketScape
- Exercised option, through Canopy Management, LLC, to acquire 60% controlling interest in Golden Harvest, LLC, allowing consolidation of financial results from Michigan
- Raised gross proceeds of $6.6M in fiscal 2021 to fund expansion
- Total assets of $14.2M at year end 2021 compared to $3.8M at year end 2020, an increase of 277%
- Retired senior secured convertible debentures
- Subsequent to year end, Grown Rogue raised $1.3M in a non-brokered private placement; including $1.0M from Bengal Capital, a venture capital firm with significant cannabis expertise, and $0.3M from the company CEO
Management Commentary
“Grown Rogue grew substantially in 2021 driven by continued expansion in Michigan and Oregon. We started 2021 producing approximately 200 pounds of indoor whole flower/month and ended the year producing more than 1250 pounds/month. Our focus on building the premier craft flower company at scale is being realized in all aspects of our business particularly quality, yield, and costs per pound.” said Obie Strickler, CEO of Grown Rogue. “Despite 2021 being a difficult year for our peers, we grew aEBITDA ~800% year over year and achieved some of the highest margins in the industry, as a wholesaler in two very competitive markets. The company continues to gain market share in both Oregon and Michigan as our customers and retail partners value our quality, consistency, and service. Our recent soft launch of nitrogen sealed pre-rolls in Michigan has been well received and we are excited to push into additional product categories in 2022.”
Highlights by State
Oregon Operations
- 2021 Revenue of $5.2M compared to $3.8M in 2020, an increase of 34%
- 2021 Gross profit, before fair value adjustments, of $2.2M (43% margin) compared to $1.7M (44% margin) in 2020, an increase of 31%
- Segmented aEBITDA of $1.7M (33% margin) compared to $0.3M (6% margin) in 2020, an increase of 576%
- Average selling price of indoor whole flower in 2021 of $1005/pound compared to $1201/pound in 2020, a decrease of 16%
- Segmented aEBITDA margin expanded 2700 basis points despite a double-digit percent decline in average selling prices
- 2021 Outdoor harvest of 5,500 pounds of whole flower compared to 2,300 pounds in 2020, an increase of 139%
- Increased indoor production run rate from 200 pounds/month in Q1 2021 to 700 pounds/month in Q4 2021
Michigan Operations (through Golden Harvest, LLC)
- 2021 Revenue of $3.9M and pro-forma revenue2 of $6.4M, compared to $2.5M in 2020, an increase of 158%
- 2021 Gross profit of $2.8M, gross margin of 73%, before fair value adjustments
- Segmented aEBITDA of $2.2M, aEBITDA margin of 58%
- Average selling price of indoor whole flower of $1887/pound
- Increased indoor production run rate from 200 pounds/month in Q1 2021 to 550 pounds/month in Q4 2021
-
Improved wholesale position in bulk flower sales from 20th in Q2 2021 to 10th in Q4 2021, according to LeafLink’s MarketScape
Selected Financial Information (Complete financial tables have been filed on www.sedar.com)
STATEMENTS OF FINANCIAL POSITION |
|
October 31, 2021 |
|
October 31, 2020 |
||
ASSETS |
|
|
|
|
||
Current assets |
||||||
Cash |
$ |
1,114,033 |
|
$ |
217,788 |
|
Accounts receivable |
739,248 |
|
172,121 |
|
||
Biological assets |
1,188,552 |
|
250,690 |
|
||
Inventory |
3,306,312 |
|
1,124,360 |
|
||
Prepaid expenses and other assets |
357,541 |
|
69,816 |
|
||
Total current assets |
$ |
6,705,686 |
|
$ |
1,834,775 |
|
Marketable securities |
610,092 |
|
585,035 |
|
||
Other investments |
750,000 |
|
187,812 |
|
||
Property and equipment |
5,742,584 |
|
1,151,799 |
|
||
Intangible assets and goodwill |
399,338 |
|
4,997 |
|
||
TOTAL ASSETS |
$ |
14,207,700 |
|
$ |
3,764,418 |
|
LIABILITIES |
|
|||||
Current liabilities |
|
|||||
Accounts payable and accrued liabilities |
$ |
1,766,707 |
|
$ |
1,059,971 |
|
Current portion of lease liabilities |
624,935 |
|
100,277 |
|
||
Current portion of long-term debt |
843,900 |
|
46,099 |
|
||
Business acquisition consideration payable |
|
358,537 |
|
|
- |
|
Interest payable |
13,750 |
|
9,367 |
|
||
Derivative liabilities |
- |
|
583,390 |
|
||
Income tax |
|
254,631 |
|
|
- |
|
Total current liabilities |
$ |
3,862,460 |
|
$ |
1,799,104 |
|
Accrued liabilities |
123,413 |
|
389,816 |
|
||
Lease liabilities |
1,735,503 |
|
16,630 |
|
||
Long-term debt |
1,365,761 |
|
753,715 |
|
||
Convertible debentures |
- |
|
1,739,678 |
|
||
Deferred rent |
- |
|
10,494 |
|
||
TOTAL LIABILITIES |
$ |
7,087,137 |
|
$ |
4,709,437 |
|
EQUITY |
|
|||||
Share capital |
$ |
20,499,031 |
|
$ |
14,424,341 |
|
Shares issuable |
74,338 |
|
- |
|
||
Contributed surplus |
6,407,935 |
|
4,070,264 |
|
||
Accumulated other comprehensive income (loss) |
(90,378 |
) |
(12,197 |
) |
||
Accumulated deficit |
(21,804,349 |
) |
(19,394,044 |
) |
||
Equity attributable to shareholders |
$ |
5,086,577 |
|
$ |
(911,636 |
) |
Non-controlling interest |
2,033,986 |
|
(33,383 |
) |
||
TOTAL EQUITY |
$ |
7,120,563 |
|
$ |
(945,019 |
) |
TOTAL LIABILITIES AND EQUITY |
$ |
14,207,700 |
|
$ |
3,764,418 |
|
|
Years ended October 31, |
|||
STATEMENTS OF COMPREHENSIVE LOSS |
2021 |
|
2020 |
|
Revenue |
||||
Product sales |
9,034,618 |
|
3,846,223 |
|
Service revenue |
344,055 |
|
393,381 |
|
Total revenue |
9,378,673 |
|
4,239,604 |
|
Cost of goods sold |
||||
Cost of finished cannabis inventory sold |
(3,997,617 |
) |
(2,155,507 |
) |
Cost of service revenues |
(154,353 |
) |
(271,167 |
) |
Gross profit, excluding fair value items |
5,226,703 |
|
1,812,930 |
|
Realized fair value amounts in inventory sold |
(950,461 |
) |
(1,482,725 |
) |
Unrealized fair value gain loss on growth of
|
1,824,226 |
|
1,515,492 |
|
Gross profit |
6,100,468 |
|
1,845,697 |
|
Expenses |
||||
Accretion expense |
949,811 |
|
609,357 |
|
Amortization of intangible assets |
4,997 |
|
26,600 |
|
Amortization of property & equipment |
180,015 |
|
250,836 |
|
General and administrative |
3,983,250 |
|
2,196,421 |
|
Share-based compensation |
280,819 |
|
337,162 |
|
Total expenses |
5,398,892 |
|
3,420,376 |
|
Gain (loss) from operations |
701,576 |
|
(1,574,679 |
) |
Other income and (expense) |
||||
Interest expense |
(197,632 |
) |
(249,296 |
) |
Other income (expense) |
(17,072 |
) |
14,750 |
|
Gain on disposal of subsidiary |
- |
|
1,574 |
|
Loss on debt restructure |
- |
|
(765,707 |
) |
Gain on derecognition of derivative liability |
- |
|
244,572 |
|
Gain on debt settlement |
141,180 |
|
23,939 |
|
Loss on settlement of non-controlling interest |
(189,816 |
) |
- |
|
Unrealized loss on marketable securities |
(35,902 |
) |
(263,483 |
) |
Unrealized gain (loss) on derivative liability |
(1,258,996 |
) |
221,820 |
|
Loss on disposal of property and equipment |
(7,542 |
) |
(9,978 |
) |
Loss from operations before taxes |
(864,204 |
) |
(2,356,488 |
) |
Income tax |
(150,543 |
) |
- |
|
Net Loss |
(1,014,747 |
) |
(2,356,488 |
) |
Other comprehensive income (items that may
|
|
|
||
Currency translation |
(78,181 |
) |
(134,117 |
) |
Total comprehensive loss |
(1,092,928 |
) |
(2,490,605 |
) |
Loss per share attributable to shareholders – basic & diluted |
(0.02 |
) |
(0.03 |
) |
Weighted average shares outstanding – basic & diluted |
135,231,802 |
|
90,596,827 |
|
Net loss for the period attributable to: |
|
|
||
Non-controlling interest |
1,395,558 |
|
(75,049 |
) |
Shareholders |
(2,410,305 |
) |
(2,281,439 |
) |
Net loss |
(1,014,747 |
) |
(2,356,488 |
) |
Comprehensive loss for the period attributable to: |
||||
Non-controlling interest |
1,395,558 |
|
(75,049 |
) |
Shareholders |
Subscribe to the BAM NewsletterSign up for one of BAM's newsletter to learn more about bioscience, happenings in Manitoba's bioeconomy, industry conferences, and BAM training events. | |||