CALGARY, ALBERTA – July 8, 2024 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products would like to provide an update to its shareholders and stakeholders.
Over the past month, the Company has executed a series of initiatives to improve operating efficiencies and focus on reducing expenses. These came in the form of process optimization, portfolio rebalancing, right-sizing labour and new market exploration. The purpose of this release is to provide some insight into these initiatives that form the basis of our new business strategy.
“Unfortunately, our stock has taken a hit over the last while. This is disappointing and shareholder value is something we will focus on. Our balance sheet needs to improve, and I believe we are taking the right steps to do so. Decibel has consistently outperformed its peers by market share, revenue generation and profitability despite what our valuation may suggest. We are implementing operational and strategic enhancements that we anticipate will form the basis of a stronger and more resilient company allowing us to grow and take back market share,” said CEO Benjamin Sze.
Domestic Flower Strategy
QWEST was the preeminent dried flower brand in 2018 when Decibel was formed. Over the past few years, our business focused on the highly scalable ready-to-consume product strategy (“RTC”). This has left an opportunity for the Company to re-align and refocus on our dried flower consumer, where we significantly under-index category market share. Over the next month, we are excited to relaunch QWEST, delivering a value proposition that does not exist in market today.
“QWEST started off as a premium brand. As our product mix shifted to RTC, we failed to deliver on consumer expectations in the dried flower category, while the market evolved around us. The upcoming relaunch of QWEST is focused on delivery of exceptional value to the flower consumer. This platform, once established in Canada, will give us optionality both domestically and internationally and is expected to show market share gains,” said CMO Warren Matzelle.
International Markets
We are also excited to announce that we have begun shipping vapes to Australia and expect to ship our first flower and vape products to the UK in early Q3 2024. With these shipments we expect our brands to be just as successful internationally.
Portfolio Optimization
The Company has completed a review of our product portfolio and lifecycle patterns. SKU portfolio have been optimized ensuring we remain true to the General Admission, VOX and Qwest brands. Our refreshed portfolio gives us meaningful participation in critical segments in vape, infused pre-roll, standard pre-roll and flower. Ensuring we have the right mix of products to meet the needs and wants of our consumers.
“Decibel has been very good at identifying market trends and ensuring we are competitive in the categories we participate in. I believe by optimizing on our product mix, we will better serve consumers and support our retailer partners,” said CRO Adam Coates
Rightsizing Initiatives:
Capex initiatives were put on pause with dollars being allocated to revenue generating activities alongside process improvements and right sizing of the business. These initiatives are intended to realize an estimated annualized reduction in SG&A by approximately $2 million. In addition to the rightsizing, work has been done to improve working capital and significantly reducing AP.
“With all the implementation, we expect to materially strengthen our balance sheet, positioning the Company better to capitalize on opportunities in the future,” said CFO Stuart Boucher.
Cultivation Reorganization
Dried flower processing has been reorganized across our facilities. These changes will allow us to increase efficiencies at each facility while ensuring we have quality checkpoints that are consistent across the organization. These changes are expected to allow a path to scale additional production while maintaining the great quality as required by consumer demand.
“Changing the flow of how cannabis flower moves through our various facilities will allow each operation to focus on its core competency. This flexibility enables us to quickly scale up and down our supply to match the ever-changing demand profile irrespective of whether that demand comes through international sales or domestic wholesale,” said COO Kris Newell.
Change in Auditor
The Company’s former auditor KPMG LLP has exited the Canadian cannabis industry and therefore will not be standing for re-election at the Company’s AGM. As a result the Company will be appointing a new auditor within the month of July 2024 and, following which, the Company intends to announce the date of our AGM. KPMG LLP will remain engaged to review the Q2 2024 financial statements to the extent requested by the Company.
About Decibel
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta and two cultivation facilities in Creston, British Columbia and Battleford, Saskatchewan.
Neither 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 news release.
CALGARY, ALBERTA – May 29, 2024 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce its unaudited interim financial results for the three month period ending March 31, 2024.
“Despite the drop in revenue, we remain one of Canada’s top brands by market share. With a focused effort on our strategy, we expect an improved Q2 and more importantly a continued path to sustainable growth and profitability. I am currently undergoing a comprehensive business review and I look forward to sharing the initiatives undertaken before July 15th.” said Benjamin Sze, Decibel’s Chief Executive Officer.
First Quarter Highlights
National Market Share(1)of 6.0% in Q1 2024, which placed Decibel as the 4th largest licensed producer in Canada by market share.
Net Revenue was $21.0 million in the first quarter of 2024, with year over year decrease of 16%. Net revenue decrease driven by increased competition in the infused pre-roll segment, vape consumers switching towards large format 510 cartridges and disposables and the halting of exports to Israel as the Company transitioned to a new distribution partner. Subsequent to quarter end, Decibel has launched large format 510 cartridges and disposables.
Gross Margin Before Fair Value Adjustments was 48% in the first quarter of 2024, compared to 51% in the first quarter of 2023.
Adjusted EBITDA(2)of$3.6 million in the first quarter of 2024, with a year over year decline of 45% over the first quarter of 2023. The decrease in Adjusted EBITDA quarter over quarter was primarily driven by a decline in net Canadian recreational sales and international sales and the reclassification of retail financial contributions to discontinued operations, partially offset by a decrease in SG&A.
Positive Free Cash Flow(2) of $375 thousand in the first quarter of 2024, with a sequential decrease of 79% over the first quarter of 2023.
Adjusted Net Loss(2)of$3.5 million in the first quarter of 2024, with a decline of $6.8 million over the first quarter of 2023. Adjusted Net Income was negatively impacted by a $3.3 million impairment on the Prairie Record’s assets held for sale during the first quarter of 2024 and subsequently sold on April 10, 2024.
Adjusted Earning Per Share (“Adjusted EPS”)(3) of negative $0.01, with a year over year decrease of $0.02.
Notes:
1 HiFyre Retail Analytics, Licensed Producer Sales over Time Nationally
2 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
3 Non-GAAP ratio. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Summary Highlights
1 Supplementary financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
2 Refer to “Cash Flows” in the MD&A (as defined herein) for further details.
3 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Decibel’s unaudited condensed consolidated interim financial statements for the three month period ending March 31, 2024 (the “Financial Statements”) and related management’s discussion & analysis for the three month period ending March 31, 2024 (“MD&A”) are available under the Company’s profile at www.sedarplus.ca.
As of March 31, 2024, Decibel was in compliance with all of its financial covenants and expects to remain in compliance for the remainder of its twelve-month forecast period.
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta and two cultivation facilities in Creston, British Columbia and Battleford, Saskatchewan.
Neither 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 news release.
Cautionary Statements
Non-GAAP Measures
This news release contains certain financial performance measures that are not recognized or defined under IFRS (termed “Non-GAAP Measures”). As a result, this data may not be comparable to data presented by other licensed producers and cannabis companies. For an explanation of these measures to related comparable financial information presented in the Financial Statements prepared in accordance with IFRS, refer to the discussion below. 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, these Non-GAAP Measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
Non-GAAP Financial Measures
Adjusted EBITDA is a non-GAAP financial measure that is calculated as net income (loss) and comprehensive income (loss) excluding unrealized gain on changes in fair value of biological assets, change in fair value of biological assets realized through inventory sold, depreciation and amortization expense, share-based compensation, other income, finance costs, foreign exchange loss, non-cash production costs and severance payments. Non-cash production costs relate to amortization expense allocations included in production costs. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Adjusted Net Income is a non-GAAP financial measure that is calculated as net income (loss) and comprehensive income (loss) excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold. Adjusted EPS is a non-GAAP ratio that is calculated as net income (loss) and comprehensive income (loss) excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold, divided by the weighted average common shares outstanding. These measures are intended to provide a proxy for the Company’s net income (loss) and comprehensive income (loss) and are used to compare Decibel to its competitors and derive expectations of future financial performance of the Company and should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Free Cash Flow is a non-GAAP financial measure that is calculated as cash flow from operations less cash provided by (used in) investing activities. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Non-GAAP Ratios
Adjusted earnings per share (adjusted net income (loss) divided by the number of outstanding shares) is a non-GAAP ratio, does not have a standardized meaning prescribed by GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. The Company believes that adjusted earnings per share is a useful metric to normalize net income for biological asset accounting impacts.
Supplementary Financial Measures
International Sales is a supplementary financial measure intended to provide a more accurate depiction of international sales earned by the Company’s wholesale operations.
Gross Canadian Recreational Sales is a supplementary financial measure intended to provide a more accurate depiction of gross revenue earned by the Company’s wholesale operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is added to Gross Canadian Recreational Sales as found in the Financial Statements to arrive at Gross Canadian Recreational Sales.
Net Canadian Recreational Sales is a supplementary financial measure intended to provide a more accurate depiction of net revenue earned by the Company’s wholesale operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is added to Net Canadian Recreational Sales as found in the Financial Statements to arrive at Net Canadian Recreational Sales.
Forward-Looking Statements
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: expectations that demand for Decibel’s products will grow; the ability for Decibel to delight customers through the Company’s product offering; the ability of the Company to extend its product offering to new countries and create a global footprint; and the Company’s expectation that it will remain in compliance with allof its financial covenants under its credit facilities for the remainder of its twelve-month forecast period and its other business plans and expectations. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements contained in this news release. Except as required by law, 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.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: risks relating to delays, regulatory changes and impacts; capital requirements; construction impacts; the ability to obtain and maintain licences to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licences (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; the risk that the Company may not be able to meet consumer demand; the risk that the Company may not improve its operational capacity when anticipated or at all; the risk that Decibel may not remain in compliance with its financial covenants for the remainder of its twelve-month forecast period; and the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable.
With respect to forward-looking statements contained in this news release, Decibel has made assumptions regarding, but not limited to: growth of the brand and recognition in Canada will lead to growth internationally; demand for Decibel’s products; Decibel’s ability to enter new markets and industry verticals; Decibel’s ability to attract, develop and retain key personnel; Decibel’s ability to raise additional capital and to execute on its expansion plans; the timelines for new product launches; Decibel’s ability to continue investing in infrastructure and implement scalable controls, systems and processes to support its growth; the impact of competition; the changes and trends in Decibel’s industry or the global economy; the Company’s ability to generate sufficient cash flow from operations and obtain financing, if needed, on acceptable terms or at all; the general economic, financial market, regulatory and political conditions in which the Company operates; the ability of the Company to ship its products and maintain supply chain stability; consumer interest in the Company’s products; anticipated and unanticipated costs; government regulation of the Company’s activities and products; the timely receipt of any required regulatory approvals; the Company’s ability to conduct operations in a safe, efficient and effective manner; the Company’s construction plans and timeframe for completion of such plans; and the changes in laws, rules, regulations, and global standards.
Readers are cautioned that the foregoing list of assumptions and risk factors is not exhaustive. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this news release are made as of the date hereof and Decibel does not undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.
Market, Independent Third Party and Industry Data
Certain market, independent third party and industry data contained in this news release is based upon information from government or other independent industry publications and reports or based on estimates derived from such publications and reports. Government and industry publications and reports generally indicate that they have obtained their information from sources believed to be reliable, but Decibel has not conducted its own independent verification of such information. This news release also includes certain data derived from independent third parties. While Decibel believes this data to be reliable, market and industry data is subject to variations and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey. Decibel has not independently verified any of the data from independent third party sources referred to in this news release or ascertained the underlying assumptions relied upon by such sources.
CALGARY, ALBERTA – April 29, 2024 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce its audited financial results for the three and twelve month periods ending December 31, 2023.
“The Company’s fourth quarter financial results delivered another year of growth across all metrics and I look forward to working with the team to continue to build on this success” said Benjamin Sze, Decibel’s new Chief Executive Officer.
Fiscal Year 2023 Financial Highlights
Record Net Revenue of $116 million in 2023, an increase of 46% over 2022.
Record Adjusted EBITDA(1) of $25.9 million in 2023, an increase of 52% over 2022.
Record Adjusted Net Income(1) of $8.0 million in 2023, an increase of $4.9 million over 2022.
Notes:
1 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
2 Non-GAAP ratio. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Fourth Quarter Highlights
Record Net Revenue was $27.7 million in the fourth quarter of 2023, with year over year growth of 8%. The net revenue growth was driven by increased demand for the Company’s derivative products.
Gross Margin Before Fair Value Adjustments was 45% in the fourth quarter of 2023, compared to 43% in the fourth quarter of 2022. The increase partially reflects operational investments that partially impacted the quarter, including expansion of the Company’s manufacturing capacity.
Adjusted EBITDA(1)of$5.1 million in the fourth quarter of 2023, with a year over year decline of 27% over the fourth quarter of 2022. The decrease in Adjusted EBITDA was primarily driven by an increase in SG&A relating to increased sales and marketing spend and the launch of the Blinker proprietary vape system of $638 thousand.
Adjusted Net Income(1)of negative$132 thousand in the fourth quarter of 2023, with a decline of $1.9 million over the fourth quarter of 2022. Adjusted Net Income was negatively impacted by $1.8 million of bad debt expense and $638 thousand for launch costs of Blinker, the Company’s proprietary new closed loop vape system.
Leverage: At the end of the fourth quarter of 2023, Decibel had a funded debt to trailing twelve month EBITDA(2) of 1.58x.
Notes:
1 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
2 Non-GAAP ratio. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Operating Highlights
International Developments
Subsequent to year end, the Company achieved the following developments internationally:
Completed its craft cannabis first export to Australia in March 2024;
Received its first purchase order for vapes to export to Australia;
Signed a supply agreement with a new Israel counterparty contemplating an annual commitment of 1,000 kilograms of craft cannabis; and
An Israeli customer defaulted on its payments required under the cannabis supply agreement with the Company, leading the Company to provision $1.6 million of such receivable. The Company took formal legal action to collect the receivable, and the Israeli company subsequently filed an insolvency motion. Decibel joined these proceedings and formally filed its claim with the trustee. The Company believes there is 300kg of inventory related to this provisioned receivable that is currently accessible, and that a portion of the receivable may be recoverable through a resale agreement of this inventory with the trustee and another Israeli company.
Summary Highlights
1 In the table above, wholesale inventory transferred to the retail stores and subsequently sold of $1.0 and $3.2 million for the three and twelve months, respectively, have been eliminated from retail sales and attributed to wholesale sales of flower and extracts to provide a more accurate depiction of business performance.
2 Supplementary financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
3 Refer to “Cash Flows” in the MD&A (as defined herein) for further details.
4 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
5 Non-GAAP ratio. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Decibel’s audited financial statements for the year ending December 31, 2023 (“Financial Statements”) and related three and twelve month periods ending December 31, 2023 Management’s Discussion & Analysis (“MD&A”), are available under the Company’s profile at www.sedarplus.com. As of December 31, 2023, Decibel was in compliance with all of its financial covenants and expects to remain in compliance for the remainder of its twelve-month forecast period.
About Decibel
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
Cautionary Statements
Non-GAAP Measures
This press release contains certain financial performance measures that are not recognized or defined under IFRS (termed “Non-GAAP Measures”). As a result, this data may not be comparable to data presented by other licensed producers and cannabis companies. For an explanation of these measures to related comparable financial information presented in the Financial Statements prepared in accordance with IFRS, refer to the discussion below. 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, these Non-GAAP Measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
Non-GAAP Financial Measures
Adjusted EBITDA is a non-GAAP financial measure that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets, change in fair value of biological assets realized through inventory sold, depreciation and amortization expense, share-based compensation, other income, finance costs, foreign exchange loss, non-cash production costs and severance payments. Non-cash production costs relate to amortization expense allocations included in production costs. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Adjusted Net Income is a non-GAAP financial measure that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold. Adjusted EPS is a non-GAAP ratio that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold, divided by the weighted average common shares outstanding. These measures intended to provide a proxy for the Company’s net income and comprehensive income and is used to compare Decibel to its competitors and derive expectations of future financial performance of the Company and should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.2
Free Cash Flow is a non-GAAP financial measure that is calculated as cash flow from operations less cash used in investing activities. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Non-GAAP Ratios
Adjusted earnings per share (adjusted net income (loss) divided by the number of outstanding shares) and funded debt to trailing twelve month adjustedEBITDA (total debt divided by trailing twelve month adjusted EBITDA) are non-GAAP ratios, do not have a standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers. The Company believes that adjusted earnings per share is a useful metric to normalize net income for biological asset accounting impacts. The Company believes that funded debt to trailing twelve month adjusted EBITDA is a useful metric in assessing the company’s ability to repay total debt.
Supplementary Financial Measures
Retail Sales is a supplementary financial measure that is intended to provide a more accurate depiction of the revenue earned by the Company’s retail operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is removed from Retail Revenue as presented in the Financial Statements.
International Sales is a supplementary financial measure intended to provide a more accurate depiction of international sales earned by the Company’s wholesale operations.
Gross Canadian Recreational Sales is a supplementary financial measure intended to provide a more accurate depiction of gross revenue earned by the Company’s wholesale operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is added to Gross Canadian Recreational Sales as found in the Financial Statements to arrive at Gross Canadian Recreational Sales.
Net Canadian Recreational Sales is a supplementary financial measure intended to provide a more accurate depiction of net revenue earned by the Company’s wholesale operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is added to Net Canadian Recreational Sales as found in the Financial Statements to arrive at Net Canadian Recreational Sales.
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: expectations that demand for Decibel’s products will grow; the ability for Decibel to delight customers through the Company’s product offering; the ability of the Company to extend its product offering to new countries and create a global footprint; and the Company’s expectation that it will remain in compliance with allof its financial covenants under its credit facilities for the remainder of its twelve-month forecast period and its other business plans and expectations. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, 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.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: risks relating to delays, regulatory changes and impacts, capital requirements, construction impacts, the ability to obtain and maintain licences to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licences (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; the risk that the Company may not be able to meet consumer demand; the risk that the Company may not improve its operational capacity when anticipated, or at all; the risk that Decibel may not remain in compliance with its financial covenants for the remainder of its twelve-month forecast period; and the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable.
With respect to forward-looking statements contained in this press release, Decibel has made assumptions regarding, but not limited to: growth of the brand and recognition in Canada will lead to growth internationally; demand for Decibel’s products; Decibel’s ability to enter new markets and industry verticals; Decibel’s ability to attract, develop and retain key personnel; Decibel’s ability to raise additional capital and to execute on its expansion plans; the timelines for new product launches, Decibel’s ability to continue investing in infrastructure and implement scalable controls, systems and processes to support its growth; the impact of competition; the changes and trends in Decibel’s industry or the global economy; the Company’s ability to generate sufficient cash flow from operations and obtain financing, if needed, on acceptable terms or at all; the general economic, financial market, regulatory and political conditions in which the Company operates; the ability of the Company to ship its products and maintain supply chain stability; consumer interest in the Company’s products; anticipated and unanticipated costs; government regulation of the Company’s activities and products; the timely receipt of any required regulatory approvals; the Company’s ability to conduct operations in a safe, efficient and effective manner; the Company’s construction plans and timeframe for completion of such plans; and the changes in laws, rules, regulations, and global standards.
Market, Independent Third Party and Industry Data
Certain market, independent third party and industry data contained in this news release is based upon information from government or other independent industry publications and reports or based on estimates derived from such publications and reports. Government and industry publications and reports generally indicate that they have obtained their information from sources believed to be reliable, but Decibel has not conducted its own independent verification of such information. This news release also includes certain data derived from independent third parties. While Decibel believes this data to be reliable, market and industry data is subject to variations and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey. Decibel has not independently verified any of the data from independent third party sources referred to in this news release or ascertained the underlying assumptions relied upon by such sources.
CALGARY, ALBERTA – April 10, 2024 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce that it has closed the previously disclosed sale of the assets of its brick-and-mortar retail cannabis operations (“Prairie Records”) to Fire & Flower Inc., a wholly-owned subsidiary of 2759054 Ontario Inc. d.b.a FIKA, for approximately $3.0 million. Prairie Records is comprised of three cannabis stores in Alberta and three cannabis stores in Saskatchewan.
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
CALGARY, ALBERTA – April 8, 2024 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce the appointment of Benjamin Sze as its Chief Executive Officer, effective April 8, 2024.
Mr. Sze’s transition into the role is expected to be very familiar for both him and the Company as Mr. Sze previously served as the CEO of Decibel before resigning in late 2020 to focus on the health of his family.
“We are very excited to have Mr. Sze rejoin the Company as its CEO and bring his experience and expertise back into the business to help facilitate and shepherd the Company through its next phase of development” said Shawn Dym, Decibel’s Chairman.
Former CEO Paul Wilson will be assisting Mr. Sze in handing off leadership of the Company.
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
Decibel is a consumer-centred cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio, sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
CALGARY, ALBERTA – March 22, 2024 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce that it has entered into a binding agreement for the sale of the assets of its brick-and-mortar retail cannabis operations (“Prairie Records”) to Fire and Flower Inc., a wholly-owned subsidiary of 2759054 Ontario Inc. d.b.a FIKA (“FIKA”), for approximately $3.0 million (the “Transaction”). Prairie Records is comprised of three cannabis stores in Alberta and three cannabis stores in Saskatchewan.
“Decibel remains committed to our core mission of delivering exceptional cannabis brands and products in Canada and around the world. The sale of Prairie Records marks a strategic decision in our growth journey, enabling us to focus resources and drive innovation in our core branded product business. We are dedicated to expanding and diversifying our premium product brand portfolio in Canada and globally.” said Adam Coates, Chief Revenue Officer. “Prairie Records continues to hold its place as one of the most unique and beloved cannabis retail brands in Canada. We are proud of Prairie Records’ legacy, the team that helped make it a success and believe that FIKA is a great fit to continue serving Prairie Records customers now and into the future.” The Transaction is subject to customary conditions of closing for a transaction of this nature and is expected to close before the end of Q1 2024.
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
Forward-Looking Statements
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, the terms of and anticipated closing of the Transaction; the Company’s ability to drive innovation in its core branded product business; and the Company’s ability to expand and diversify it’s premium product brand portfolio in Canada and globally.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: the ability of the parties to satisfy the conditions to closing of the Transaction; the ability of the parties to complete the Transaction on the terms currently contemplated or at all; satisfaction of all international regulatory requirements, including applicable product testing; risks relating to delays; other regulatory changes and impacts; capital requirements; construction impacts; displacement requirements; unforeseen requirements resulting from the COVID-19 pandemic and other global macro-economic events, conditions and factors; the ability to obtain and maintain licenses to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licenses (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis, international export rules and regulations; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; the satisfaction of conditions precedent under the Company’s credit facilities; timing and completion of construction and expansion of the Company’s production facilities; and the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable.
There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements contained in this news release. Except as required by law, 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.
These forward-looking statements are made as of the date of this news release and the Company disclaims any intent or obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
CALGARY, ALBERTA – November 16, 2023 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce its interim financial results for the three and nine month periods ending September 30, 2023.
“With continued success in our ready to consume product strategy, our recent launches including General Admission Blinker, General Admission edibles, and our new brand Vox Popz crushable pre-rolls are expected to further cement our ready to consume position and meaningful growth in the coming year.” said Paul Wilson, CEO of Decibel. “Alongside these top line growth initiatives, we are pleased to have concluded the expansion of our manufacturing capacity, which will expand gross margin and support our new wave of product launches.”
Third Quarter Highlights
National Market Share(2)of7.5% in Q3 2023 which placed Decibel as the 2nd largest licensed producer in Canada by market share.
Net Revenue of $30.2 million in the third quarter of 2023, with a sequential decline of 2% over the prior quarter, and year over year growth of 65%. Net revenue growth was driven by growth in demand for vapes and infused products, increased manufacturing capacity, international sales(4), and the launch of the Company’s new brand Vox and General Admission Edibles. International sales were impacted by $1.4 million due to third party lab delays which have since been resolved with Q3 volumes having been sold in Q4 2023.
Gross Margin Before Fair Value Adjustments was43% in the third quarter of 2023, compared to 42% in the prior quarter and 52% in the third quarter of 2022. The third quarter was impacted by a $368 thousand write off of aged product and increased temporary labour of $566 thousand to meet market demand. The Company completed certain operational investments in November, including the expansion of its manufacturing capacity, which at current production and sales is anticipated to realize cash-flow savings of approximately $10 million at full year production rate.
Adjusted EBITDA(1)of$6.7 million in the third quarter of 2023, with a sequential decline of 8% over the prior quarter and year over year growth of 57%.
Positive Free Cash Flow(1)of$1.2 million in the third quarter of 2023, with a sequential increase of 152% over the prior quarter and a year over year decline of 50%.
Adjusted Net Income(1)of$523 thousand in the third quarter of 2023, with a sequential decline of 88% over the prior quarter and a year over year decline of 82%. Adjusted Net Income was negatively impacted by a litigation expense of $3 million related to arbitration that is now concluded.
Adjusted Earnings Per Share(“Adjusted EPS”)(3): of nil in the third quarter, a decrease of $0.01 from the prior quarter and a year over year decrease of $0.01.
Year to Date Highlights
Net Revenue of $88.2 million, an increase of 65% over 2022.
Adjusted EBITDA(1) of $20.8 million, an increase of 109% over 2022.
Positive Free Cash Flow(1) of $3.4 million, a decrease of 31% over 2022.
Adjusted EPS(3) of $0.02, an increase of $0.02 over 2022.
Notes:
1 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
2 HiFyre Retail Analytics, Licensed Producer Sales over Time Nationally
3 Non-GAAP ratio. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
4 Supplementary financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Summary Highlights1
1 In the table above, wholesale inventory transferred to the retail stores and subsequently sold of $802 thousand and $2.2 million for the three and six month periods, has been eliminated from retail sales and attributed to gross Canadian recreational sales and net Canadian recreational sales to provide a more accurate depiction of business performance.
2 Supplementary financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
3 Non-GAAP financial measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
4 Non-GAAP ratio. Refer to “Cautionary Statement Regarding Certain Non-GAAP Measures” for further details.
Decibel’s interim financial statements for the three and nine month periods ending September 30, 2023 (“FinancialStatements”) and related Management’s Discussion & Analysis for three and nine month periods ending September 30, 2023, are available under the Company’s profile atwww.sedarplus.ca.
As of September 30, 2023, Decibel was in compliance with all of its financial covenants under its credit facilities and expects to remain in compliance for the remainder of its twelve-month forecast period.
About Decibel
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
Cautionary Statement Regarding Certain Non-GAAP Measures
This press release contains certain financial performance measures that are “specified financial measures” (as such term is defined in National Instrument 52-112 – Non-GAAP and Other Financial Measures Disclosure) and are not recognized or defined and do not have a standardized meaning under IFRS. As a result, this data may not be comparable to data presented by other licensed producers and cannabis companies. For an explanation of these measures to related comparable financial information presented in the Financial Statements prepared in accordance with IFRS, refer to the discussion below. The Company believes that these specified financial measures are useful indicators of operating performance and are specifically used by management to assess the financial and operational performance of the Company. Accordingly, these specified financial measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
Non-GAAP Financial Measures
Adjusted EBITDA is a non-GAAP financial measure that is intended to provide a proxy for the Company’s operating cash flow and is widely used by industry analysts to compare Decibel to its competitors and derive expectations of future financial performance of the Company. Adjusted EBITDA increases comparability between comparative companies by eliminating variability resulting from differences in capital structures, management decisions related to resource allocation, and the impact of fair value adjustments on biological assets, inventory, and financial instruments, which may be volatile on a period-to-period basis. Adjusted EBITDA is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets, change in fair value of biological assets realized through inventory sold, depreciation and amortization expense, share-based compensation, other income, finance costs, foreign exchange loss, non-cash production costs and severance payments. Non-cash production costs relate to amortization expense allocations included in production costs. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Adjusted net income is a non-GAAP financial measure that is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold. This non-GAAP financial measure is intended to provide a proxy for the Company’s net income and comprehensive income and is used to compare Decibel to its competitors and derive expectations of future financial performance of the Company and should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Free cash flow is a non-GAAP financial measure that is used to measure Decibel’s ability to generate value and grow the Company’s business. Free cash flow is calculated as cash flow from operations less cash used in investing activities. This non-GAAP financial measure should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate the Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
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Non-GAAP Ratios
Adjusted EPS is a non-GAAP ratio that is intended to provide a proxy for the Company’s net income and comprehensive income and is used to compare Decibel to its competitors and derive expectations of future financial performance of the Company. This measure increases comparability between comparative companies by eliminating variability resulting from differences in management assumptions related to the impact of fair value adjustments on biological assets, which may be volatile on a period-to-period basis. Adjusted EPS is calculated as net loss and comprehensive loss excluding unrealized gain on changes in fair value of biological assets and change in fair value of biological assets realized through inventory sold, divided by the weighted average common shares outstanding. This non-GAAP ratio should be considered together with other financial information prepared in accordance with IFRS to enable investors to evaluate Decibel’s operating results, underlying performance and prospects in a manner similar to Decibel’s management.
Supplementary Financial Measures
Retail sales is a supplementary financial measure that is intended to provide a more accurate depiction of the revenue earned by the Company’s retail operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is removed from retail revenue as presented in the Financial Statements.
International sales is a supplementary financial measure intended to provide a more accurate depiction of international sales earned by the Company’s wholesale operations.
Gross Canadian recreational sales is a supplementary financial measure intended to provide a more accurate depiction of gross revenue earned by the Company’s wholesale operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is added to gross Canadian recreational sales as found in the Financial Statements to arrive at gross Canadian recreational sales.
Net Canadian Recreational Sales is a supplementary financial measure intended to provide a more accurate depiction of net revenue earned by the Company’s wholesale operations. Inventory transferred directly from the Company’s wholesale operations to the Company’s retail operations is added to net Canadian recreational sales as found in the Financial Statements to arrive at net Canadian recreational sales.
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: Decibel’s focus, strategy, priorities and plans; the anticipated benefits to be derived from (i) the completion of its capacity expansion and the estimated $10 million in annual savings derived therefrom (ii) the Company’s recent product launches and its expectations that they will contribute to meaningful growth in the coming year; (iii) the expansion of the Company’s manufacturing facility, including its expectations that it will expand the Company’s gross margin, support its new wave of product launches and reduce its increased temporary labour expense; the Company’s expectation that it will remain in compliance with allof its financial covenants under its credit facilities for the remainder of its twelve-month forecast period and its other business plans and expectations. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, 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.
Forward-looking statements and FOFI (as defined herein) are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: risks relating to delays, regulatory changes and impacts, capital requirements, construction impacts, the ability to obtain and maintain licences to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licences (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; the risk that the Company may not be able to meet consumer demand; the risk that the Company’s new product launches may not contribute to meaningful growth in the coming year; the risk that the expansion of the Company’s manufacturing facility may not expand the Company’s gross margin, support its new wave of product launches or reduce its increased temporary labour expense; the risk that Decibel may not remain in compliance with its financial covenants for the remainder of its twelve-month forecast period; and the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable.
With respect to forward-looking statements and FOFI contained in this press release, Decibel has made assumptions regarding, but not limited to: demand for Decibel’s products; Decibel’s ability to enter new markets and industry verticals; Decibel’s ability to attract, develop and retain key personnel; Decibel’s ability to raise additional capital as and when required; the impact of competition; the changes and trends in Decibel’s industry or the global economy; the Company’s ability to generate sufficient cash flow from operations and obtain financing, if needed, on acceptable terms or at all; the general economic, financial market, regulatory and political conditions in which the Company operates; the ability of the Company to ship its products and maintain supply chain stability; consumer interest in the Company’s products; anticipated and unanticipated costs; government regulation of the Company’s activities and products; the timely receipt of any required regulatory approvals; the Company’s ability to conduct operations in a safe, efficient and effective manner; the Company’s construction plans and timeframe for completion of such plans; and the changes in laws, rules, regulations, and global standards.
Any financial outlook or future oriented financial information (in each case “FOFI”) contained in this news release regarding prospective financial position, including, but not limited to: the anticipated benefits to be derived from the expansion of the Company’s manufacturing facility, including its expectations that it will expand the Company’s gross margin and reduce its increased temporary labour expense; and Decibel’s expectations that it will remain in compliance with its financial covenants for the remainder of its twelve-month forecast period, is based on reasonable assumptions about future events, including those described above, based on an assessment by management of the relevant information that is currently available. The actual results will likely vary from the amounts set forth herein and such variations may be material.
Readers are cautioned that the foregoing list of assumptions and risk factors is not exhaustive. The forward-looking statements and FOFI contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements and FOFI included in this news release are made as of the date hereof and Decibel does not undertake any obligation to publicly update such forward-looking statements and FOFI to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.
Market, Independent Third Party and Industry Data
Certain market, independent third party and industry data contained in this news release is based upon information from government or other independent industry publications and reports or based on estimates derived from such publications and reports. Government and industry publications and reports generally indicate that they have obtained their information from sources believed to be reliable, but Decibel has not conducted its own independent verification of such information. This news release also includes certain data derived from independent third parties. While Decibel believes this data to be reliable, market and industry data is subject to variations and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey. Decibel has not independently verified any of the data from independent third party sources referred to in this news release or ascertained the underlying assumptions relied upon by such sources.
CALGARY, ALBERTA – October 4, 2023 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a leading manufacturer of cannabis ready to consume products, is pleased to announce the launch of General Admission ‘Blinker’ closed loop vape system of products. These products are expected to be available to order for licensed retailers in British Columbia the week of October 16th, in Ontario on October 19th, in Saskatchewan the week of October 23rd, in Alberta on November 3rd and in Manitoba by mid-November.
“Blinker positions Decibel to meet consumer demand for a better vape experience that delivers bold flavours, smart innovation, best-in-class airflow and superior reliability in performance” said Warren Matzelle, Chief Marketing and Product Officer. “The game-changing Blinker vape system features industry-leading innovation to address the many consumer pain points with existing vape products in today’s market. Blinker lets the consumer focus on having an enjoyable, problem-free vape experience.”
Decibel welcomes you to discover more about the future of vaping with the General Admission Blinker closed loop vape system, please visit www.generaladmission.ca/blinker
The initial products expected to be launched for the General Admission Blinker system are:
Tiger Blood 0.95g vape pod
Peach Rizz 0.95g vape pod
5 Loco 0.95g vape pod
Essentials Mixer Pack 4×0.28 vape pods
Social Sampler Pack 4×0.28g vape pods
Blinker Vape Battery
Key Highlights of the General Admission Blinker System include:
Large initial assortment of flavours and SKUs which consumers have shown to love in other formats like infused pre-rolls, 510 vape cartridges and edibles
Blinker pods will be line priced with existing General Admission 510 vape cartridges
Blinker vape batteries will be priced in-line with standard 510 batteries, making the system comparable in cost to the 510 system for consumers
Smart pod technology reduces common vape issues like, clogging and leaking, with best-in-class airflow, vapour production and flavour
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
Neither 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.
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, the Company’s strategy, focus and values; the Company’s expectations of when the Blinker closed loop vape system of products will be available to order for licensed retailers in certain provinces; the anticipated benefits to be derived from the Blinker closed loop vape system of products; the initial products that are expected to be launched for the Blinker closed loop vape system; the expected MSRP of the Blinker vape batteries; Decibel’s expectations that the Blinker closed loop vape system will change the vape category; Decibel’s expectations with respect to the impact that the new product launch will have on the Company’s business; Decibel’s expectations regarding market, industry and consumer feedback related to the Blinker closed loop vape system; and other business plans and expectations.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: satisfaction of all international regulatory requirements, including applicable product testing; risks relating to delays; other regulatory changes and impacts; capital requirements; construction impacts; displacement requirements; global macro-economic events, conditions and factors; the ability to obtain and maintain licenses to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licenses (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis, international export rules and regulations; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable; and the risk that the Blinker closed loop vape system of products may not be available to order for licensed retailers when anticipated in the provinces anticipated;
With respect to forward-looking statements contained in this news release, Decibel has made assumptions regarding, but not limited to: demand for Decibel’s products; Decibel’s ability to realize operational efficiencies and effect certain cost saving measures (including in the impact thereof); Decibel’s ability to enter new markets and industry verticals; Decibel’s ability to attract, develop and retain key personnel; Decibel’s ability to raise additional capital and to execute on its expansion plans; the timelines for new product launches, Decibel’s ability to continue investing in infrastructure and implement scalable controls, systems and processes to support its growth; the impact of competition; the changes and trends in Decibel’s industry or the global economy; the Company’s ability to generate sufficient cash flow from operations and obtain financing, if needed, on acceptable terms or at all; the general economic, financial market, regulatory and political conditions in which the Company operates; the ability of the Company to ship its products and maintain supply chain stability; consumer interest in the Company’s products; anticipated and unanticipated costs; government regulation of the Company’s activities and products; the timely receipt of any required regulatory approvals; the Company’s ability to conduct operations in a safe, efficient and effective manner; the Company’s construction plans and timeframe for completion of such plans; and the changes in laws, rules, regulations, and global standards.
There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, 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.
These forward-looking statements are made as of the date of this news release and the Company disclaims any intent or obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
CALGARY, ALBERTA – August 30, 2023 –Decibel Cannabis Company Inc. (the “Company” or “Decibel”) (TSX-V:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce that it has expanded its global footprint by entering into a supply agreement (the “Agreement”) to provide premium dried medical cannabis flower to 4C LABS, a healthcare, technology, and pharmaceutical company focused on virtual prescribing, pharmaceutical distribution and clinical development in cannabis based medicinal products for human health in the United Kingdom and Channel Islands (the “UK”).
Key Highlights
Decibel to supply 4C LABS with Qwest branded, craft-quality Medical Cannabis for distribution to UK medical cannabis patients
Decibel to grant strain exclusivity of rare and unique cultivars to be distributed by 4C LABS
3-year supply agreement
Initial shipment expected before year end
Minimum purchase commitments achieve exclusivity over certain genetics and QWEST brand in the UK
“4C LABS is building a patient focused best-in-class product line for the UK & Channel Islands, the Qwest craft flower line strengthens the top end of the 4C LABS product offerings. Decibel’s innovative craft quality Qwest flower products will fill an empty segment in the UK market and bring a world class BC Cannabis product to UK patients” said Greg Dobbin, CEO 4C LABS. Decibel’s success in Canada, the most competitive cannabis market in the world, is a product of hard work, innovation and attention to detail, qualities that will resonate with UK patients.”
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest, and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta, and two cultivation facilities in Creston, British Columbia, and Battleford, Saskatchewan.
About 4C LABS
4C LABS is a patient focused healthcare, technology, and pharmaceutical company concentrating on virtual prescribing, pharmaceutical distribution and clinical development in cannabis based medicinal products (“CBMPs”) for human health. 4C LABS is committed to advancing scientific research, as well as enabling the regulation, distribution and prescribing of CBPMs in the UK and Channel Islands. Its work with leading scientists, specialist physicians, and pharmacists is underpinned with disruptive technologies that are driving an approach to treatment that prioritizes patients and evidence over stigma. 4C LABS works closely with Drug Science, the Cannabis Industry Council (CIC), The Medicines and Healthcare Products Regulatory Agency (MHRA) and the Care Quality Commission (CQC) to catalyze safe, regulated change in the medical landscape. 4C LABS is fully licensed in the UK with MS WDA, Schedule 1 Narcotics and Production licenses.
Neither 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.
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, the timing of the initial shipment; expectations with respect to the impact the Agreement will have on the Company’s business; expectations regarding international markets and the Company’s position therein; the Company’s ability to grow its brands into new and innovative territories as well as product formats, variations and other business plans and expectations.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: satisfaction of all international regulatory requirements, including applicable product testing; risks relating to delays; other regulatory changes and impacts; capital requirements; construction impacts; displacement requirements; global macro-economic events, conditions and factors; the ability to obtain and maintain licenses to retail cannabis products; review of the Company’s production facilities by Health Canada and maintenance of licenses (including any amendments thereto) from Health Canada in respect thereof; future legislative and regulatory developments involving cannabis, international export rules and regulations; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the labour market generally and the ability to access, hire and retain employees; general business, economic, competitive, political and social uncertainties; the satisfaction of conditions precedent under the Company’s credit facilities; and the delay or failure to receive board, regulatory or other approvals, including any approvals of the TSX Venture Exchange, as applicable.
There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, 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.
These forward-looking statements are made as of the date of this press release and the Company disclaims any intent or obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
