Nova Cannabis Publishes Its Third Quarter Financial Results 2021, Ended Sep 30

Nova Cannabis Inc. (OTCQB: NVACF) (TSX: NOVC), a national cannabis retailer company, released its interim consolidated financial statements and management’s discussion and analysis for the three and nine months ended September 30, 2021.

ABOUT NOVA CANNABIS INC.

Nova Cannabis Inc. is one of Canada‘s largest and fastest growing cannabis retailers. The company is focused on overhauling the cannabis retail market by offering a wide range of high-quality cannabis products at very reasonable rates.

Nova currently runs 71 stores across Alberta, Ontario, and Saskatchewan. Most of these are run under the company’s Value Buds banner while some are run under its Nova Cannabis banner. The company is owned mainly by liquor retailer Alcanna Inc. Nova trades on the TSX under the ticker symbol NOVC.

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Darren Karasiuk, CEO of Nova, said that since its last quarterly report, the company was aggressively expanding its footprint by opening an average of one new store a week so that they had since then opened 71 stores across Alberta and Ontario.

He said that the rate of the company’s sales growth showed that its Value Buds setup was resonating well with customers and capturing new market segments. The company’s operating performance in the third quarter showed its progress toward its financial expectations.

FINANCIAL AND OPERATING HIGHLIGHTS

• The company’s sales of $38.7 million is a 141.9% increase from the third quarter of 2020, and a 30.2% increase from the second quarter of 2021
• Its gross profit of $6.5 million, which is 16.9% of sales, is a 21.8% increase from the third quarter of 2020 and a 26.0% increase from the second quarter of 2021
• Generated operating profit and cash flow across the portfolio of operating stores before pre-opening and other non-operating lease expenses and head office expenses
• Opened 11 new Value Buds stores – 6 in Ontario and 5 in Alberta. After the release of the company’s Q2 2021 financial results, stores were opened at the rate of an average one store per week.
• The company now has 71 operating stores and many more are being developed or actively negotiated. Most of these stores are in Ontario.

OUTLOOK

The company is focused on running 200 stores by 2023. Of the stores managed by the company in Alberta all except 3 have been converted into the low-cost Value Buds stores. The remaining 3 are also expected to be converted by the 4^th quarter of 2021.

Nova’s management is quite confident of the company soon developing into a profitable venture because of the way it is performing now:

• The company has now a total of 71 stores and its revenue continues to grow with Value Buds stores generating an average of $3 million annually. The average is calculated by adding the sales of even the newly-opened or newly-converted stores. The increased profit is the result of a decline in operating costs and labor charges from the second quarter of 2021 to the third quarter of 2021.

• Fixed operating costs, including that of the head office, remained steady and consistent from the second quarter of 2021 to the third quarter of 2021.

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CONFERENCE CALL

The management will conduct a conference call on November 11, 2021 at 3:00p.m. ET (1:00 p.m. MT) to discuss its third quarter operating and financial results.

To participate, please dial (416) 406-0743 or (800) 806-5484 and use the required participant access code: 5789350#. The playback will be made available approximately four hours after the event at (905) 694-9451 or (800) 408-3053, required access code: 8403552#.