VANCOUVER, BC, June 27, 2022 /CNW/ – Kiaro Holdings Corp. (“Kiaro” or the “Company”) (TSXV: KO) (OTC: KIARF), is pleased to announce that it has filed its unaudited condensed interim financial statements (“financial statements”) and management’s discussion and analysis ( “MD&A”) for the three months ended April 30, 2022 (“Q1 2022”). The highlights of which are presented in this press release and available on SEDAR.com and on the Company’s website kiaro.com. All amounts, unless otherwise indicated, are expressed in Canadian dollars.
Q1 FY2023 Highlights
Revenue growth of 77% at $9.2 million of $5.2 million in the first quarter of the previous year;
Retail revenue growth of 41% at $5.4 million of $3.8 million in the first quarter of the previous year;
Wholesale revenue growth of 78% at $3.3 millionrepresenting 36% of total turnover, $1.9 million in the first quarter of the previous year;
Maintained strong retail margins at 37%, wholesale margins increased 7% to 10% compared to the first quarter of the previous year;
Integration of new talent into leadership positions to lead and grow the retail and e-commerce segments;
Total assets at April 30, 2022 of $19.9 millioncompared to total assets at April 30, 2021 of $11.4 million;
In the first quarter of 2023, adjusted EBITDA improved in the fourth quarter of 2022 by $258,000;
E-commerce revenue growth of 26% over the prior quarter.
“We are pleased to share with our shareholders our financial performance for the first quarter of FY23, which is our third consecutive quarter of record revenue growth. This is the second quarter that included the full financial performance of our most recent Hemisphere acquisition and the exceptionally strong financial performance of National Cannabis Distribution (“NCD”), the Company’s wholly-owned subsidiary focused on the Saskatchewan wholesale market. The combined operations have proven to deliver record revenue growth, improve margins and bring us closer to our critical milestone of achieving positive EBITDA. ” said Eleanor Lynch, the company’s interim CEO. “NCD revenue growth of 78% at $3.3 million was an outstanding result and contributed more than 36% of the revenue volume. Kiaro’s ability to attract top talent to lead our business channels has proven fundamental in driving asset performance. The acquired e-commerce business is growing rapidly and has generated revenues of $752,853 in the quarter compared to $596,536 in the fourth quarter of fiscal 2022.”
“The first quarter showed excellent growth, with the company recording revenues of $9,157,643 compared to $5,167,064 in the first quarter of fiscal 2022. Revenue growth was supported by volume from the acquired Hemisphere retail stores and strong revenue results from NCD, our wholesale business,” said Eleanor Lynch, the company’s interim CEO. “NCD revenue growth of 78% at $3.3 million was an outstanding result and contributed more than 35% of the revenue volume. Kiaro’s ability to attract top talent to lead our business channels has proven fundamental in driving asset performance. »
“I would like to thank the Kiaro team who take on challenges with enthusiasm and creativity and who continue to deliver at the highest level. Retail gross margins are particularly well managed by the team, which remained stable at 37% while that the wholesale segment is at 10%.The successful management of gross margins reflects Kiaro’s strong core competence in buying strategies that encompass category management, consumer engagement, promotional cadence and research on market prices. Kiaro’s gross margins are among the healthiest of major publicly traded Canadian cannabis retailers (based on recent filings).”
For the quarter, total operating expenses as a percentage of revenues were 44% compared to 48% for the same period last year. Efficiency gains have been achieved by using existing overhead and fixed costs to support the growth of operations.
Adjusted EBITDA over the past four quarters has fluctuated. During the third and fourth quarters of fiscal 2022, approximately $452,000 costs incurred by newly acquired companies for; additional human resources, support for the integration of more than 70 employees, one-time professional fees and technical integration. In Q1 2023, Adjusted EBITDA improved compared to Q4 2022 of $258,000 due to the easing of COVID-19 omicron restrictions in Ontario and strong revenue growth in the Wholesale segment.
Summary of first quarter financial results
Adjusted EBITDA is a non-GAAP financial measure and is not a recognized, defined or standardized measure under IFRS. See “Caution Regarding Non-GAAP Measures”.
Continued growth and revenue from vendor data and education programs, which the company has agreed with major licensed producers, are expected for the remainder of the year.
Ms. Lynch said: “The company looks forward to strengthening its performance as diversification strategies continue to bear fruit, external challenges subside and newly recruited leaders focus on generating revenue in key segments”.
ABOUT KIARO TSXV:KO
Kiaro Holdings Corp (TSXV: KO) (“Kiaro”) is a trusted, diversified, omnichannel public cannabis company headquartered in Vancouver, British Columbia. Kiaro is an authorized cannabis retailer, wholesale distributor and online retailer of vaporizers and accessories. Kiaro is dedicated to introducing new and experienced consumers to a lifelong exploration of cannabis.
Closely connected to the communities in which it operates and markets under the Kiaro and Hemisphere brands, Kiaro has 17 professionally operated, best-in-class retail outlets at British Columbia, Ontario and Saskatchewan. The wholesale business, National Cannabis Distribution (NCD) is growing rapidly as it expands its services within Saskatchewan. The eCommerce activity (acquired in July 2021) has 3 sites (Vaped.ca, Vaped.com & Vaporizersdirect.com.au) operating in Canadathe United States and Australia.
With over 80 years of collective experience in retail, wholesale and e-commerce, Kiaro’s leadership team has a proven track record of growing brands across North America and the completion of acquisitions and financings. The Company plans to continue its growth trajectory through consumer-centric retail, e-commerce and wholesale distribution segments.
For more information on the company, including the most recent analyst report, please visit investors.kiaro.com.
On behalf of Kiaro Holdings Corp.
Acting General Manager
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This press release contains statements that may constitute “forward-looking information” within the meaning of applicable Canadian securities laws. Forward-looking information may include, among other things, statements regarding Kiaro’s future plans, costs, objectives or performance, or assumptions underlying any of the foregoing. In this press release, words such as “may”, “would”, “could”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend de”, “plans”, “estimates” and similar words and their negative form are used to identify forward-looking statements. In this press release, forward-looking statements relate to, among other things, the overall growth of the Canadian cannabis market and the retail opportunities and the award of new operating permits and licenses in various jurisdictions. Forward-looking statements should not be construed as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which such future performance will be achieved. There can be no assurance that the events anticipated by the forward-looking information will occur or occur. The forward-looking information is based on information available at this time and/or management’s good faith belief regarding future events and is subject to known and unknown risks, uncertainties, assumptions and other unforeseeable factors, many of which are beyond the control of Kiaro. These risks, uncertainties and assumptions include, but are not limited to, those described in the Company’s filing statement dated September 29, 2020a copy of which is available on SEDAR at www.sedar.com, and could cause actual events or results to differ materially from those projected in the forward-looking statements. In addition, any forward-looking information regarding future expansion plans is subject to such qualification as Kiaro’s management may determine, and assumptions that any construction or conversion will not be costly, required permits will be obtained and labor Work, materials and equipment required to complete such construction or conversion will be available. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Kiaro does not intend, nor undertake any obligation, to update or revise the forward-looking information contained in this press release to reflect subsequent or other information, events or circumstances, except as required by applicable law. require.
SOURCEKiaro Holdings Corp.
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