Nova Cannabis Reports 176% YoY Revenue Increase In Q4, Gross Profit Improvement

Nova Cannabis Inc. NOVC NVACF reported its audited annual consolidated financial statements and management's discussion and analysis for the year ended December 31, 2021.

Q4 2021 Financial Highlights

• Sales of $47.6 million, a 175.9% increase from the fourth quarter of 2020, and a 23.2% increase from the third quarter of 2021.
• Gross profit of $8.4 million, or 17.7% of sales, a 58% increase from the fourth quarter of 2020 and a 29.0% increase from the third quarter of 2021.

Q4 2021 Operational Update

Nova now has 78 stores open, an increase of 44 stores since December 31, 2020, and all legacy Nova branded stores have been converted to Value Buds.

Full-Year 2021 Financial Highlights

• Sales of $134.4 million, a 112.2% increase from $63.3 million in 2020.
• Gross profit of $24.9 million, or 18.5% of sales, a 19.7% increase from $20.8 million in 2020.
• Cash increased by $9.3 million to $10.5 million as at December 31, 2021.

“We launched Value Buds in 2021 to provide cannabis consumers in Canada with a better option, and the traction of our store format has been a resounding success.” Darren Karasiuk, CEO of Nova, said. “Once again, we delivered strong sequential and year over year sales growth for the quarter and we now have 78 stores open across Alberta, Saskatchewan and Ontario."

Sundial Acquisition Of Alcana

On October 7, 2021, Sundial Growers Inc SNDL entered into an arrangement agreement to acquire all of the issued and outstanding common shares of Alcanna Inc., Nova's majority shareholder.

On February 25, 2022, Alcanna and Sundial mutually agreed to extend the outside date for closing the Sundial-Alcanna Transaction to March 30, 2022 in accordance with terms of the arrangement agreement to complete the required closing matters contemplated by the arrangement agreement.

"Following Sundial's pending acquisition of our majority shareholder, Alcanna, we will gain a cannabis focused partner that is committed to supporting our value-based model with the infrastructure and financial resources to drive the expansion of our disruptive strategy at a much larger scale," Karasiuk added.

Photo: Courtesy of Giorgio Trovato on Unsplash