Relevium Reports Improved Financial Results for Second Quarter of Fiscal 2020
March 02 2020 - 7:30AM
Relevium Technologies Inc. (TSX.V:“RLV”, OTCQB:“RLLVF” and
Frankfurt: “6BX”) (the “
Company”
or “
Relevium”), is pleased to
report second quarter results for fiscal year ending June 30, 2020.
Financial highlights for the second
quarter of 2020
- The Company reported increased revenues for the reporting
period. Revenues for the second quarter were $1,124,254 (compared
to $1,006,501 in the comparable quarter of 2019).
- Gross margin for the second quarter increased by two percentage
points to 57% (compared to 55% in the previous year). The increase
was primarily due to changes in the product mix and sales
channel.
- Total expenses for the second quarter decreased by $484,719 to
$1,086,869 (compared to $1,571,558 in the second quarter of
2019).
- The company reported a net and comprehensive loss of 188,415
(compared to a net and comprehensive loss of 1,001,151 in the
second quarter of 2019)
- Total assets as at December 31, 2019 were $8,280,869 (compared
to $8,560,452 as at June 30, 2019). Current assets decreased by
444,178 to $1,351,838 in the current reporting period (compared to
$1,796,016 in June 30, 2019). The decrease was primarily the result
of a decrease in cash.
- Total liabilities increased by $569,105 to $4,081,249 in the
reporting period (compared to $3,512,144 in June 30, 2019). The
change was primarily the result of higher accounts payables and
accrued liabilities.
- The company reported a working capital deficiency of
$2,687,411, primarily due to the transfer of the long-term debt to
current liabilities. The convertible debentures are due in December
2020. Working capital is defined as current assets – current
liabilities.
Financial highlights for the six-month
period ended December 31, 2019
- The Company reported increased
revenues for the reporting period. Revenues were reported as
$2,141,940 (compared to $1,991,552 for the six-month period ended
December 31, 2019).
- Gross margin for the period
increased by one percentage points to 56% (compared to 55% in the
previous year). The changes were primarily due to variations in the
product mix and sales channel.
- Total expenses for the quarter
decreased by $265,582 to $2,482,550 (compared to $2,748,132 in the
previous reporting period).
- The company reported a net and
comprehensive loss of $1,041,451 (compared to a net and
comprehensive loss of $1,658,548 in the previous period).
Business and Corporate Development
Highlights
- On October 16, 2019, BCX executed
an agreement to acquire 100% of the shares of Weedsense Inc., a
late-stage applicant for a standard processing and medical sales
license under the Cannabis Act, for an aggregate purchase price of
$2,000,000 in cash or shares subject to certain milestones. As of
the date of this MD&A the transaction remains pending for
regulatory and compliance oversight.
- On October 25, 2019, the Company
received a letter of intent (the “LOI”) to sell BGX E-Health LLC, a
wholly-owned subsidiary, based in Orlando, Florida to NewScope
Capital Corporation (“NewScope”), a British Columbia-based,
privately held company with a goal of becoming an aggregator in the
wellness and CBD space. Under the preliminary terms of the LOI, the
Company will receive 20,000,000 shares of NewScope at $0.50 per
share for a total value of $10,000,000.
- The resulting transaction would
provide the Company with a majority interest (investment) in
NewScope. As of the date of this MD&A, the debenture holders
had approved the transaction, and the Company is looking forward to
obtaining shareholder and TSX Venture approval.
- On November 8, 2019, the Company
announced that it had executed a letter of intent to acquire a
Montreal-based biopharma contract manufacturing company through its
wholly owned subsidiary, BGX E-Health LLC. The parties have agreed
to keep the vendor’s information confidential until such a time
when the definitive agreement is executed. As per the proposed
terms of the LOI, subject to customary due diligence, Board and
TSX-Venture approval, the Company intends to close the transaction
within 90 days from the date of the definitive agreement. An
initial payment of $150,000 in shares and $100,000 in cash will be
done at closing, with an earnout bonus of $2,500,000 in shares,
vesting over a period of three reference years and based on
specific revenue and EBITDA targets. As of the date of this
MD&A, the Company is finalizing its due diligence and moving
towards a definitive agreement in conjunction with the overall
transaction with NewScope.
Outlook
The most significant challenge for the company,
in terms of its ability to execute its strategy, is its ability
to secure financing. In spite of the company’s stability in
terms of revenues and improving expenses profile, the current
context in the capital markets and the devaluation of the company’s
shares pose a serious challenge for management.
The company remains focused on the successful
execution of the spinout of BGX E-Health into New Scope Capital,
which seeks to crystalize value and creates a strong and focused
vertical in health and wellness consumer products. The company is
also focused on securing the necessary financing and structure to
execute on the business of Biocannabix.
About Relevium
TechnologiesRelevium is a publicly traded Company that
operates in the health and wellness industry, including legal
cannabis, with a primary focus on online distribution. The
principal business of the Company is the identification,
evaluation, acquisition and operation of brands and businesses in
the health and wellness markets and medical cannabis. The Company
pursues its business strategy through an acquisition and
partnership model in a holistic approach to encompass a wide range
of health and wellness consumer products. Relevium operates through
two wholly owned subsidiaries:
BGX E-Health LLC (BGX), based in Orlando,
Florida, markets dietary supplements, nutraceuticals, sports
nutrition and cosmeceuticals primarily through its Bioganix® brand
portfolio in the US and Europe. Relevium’s premium brands are sold
at some of the world’s largest retailers including Walmart.com and
Amazon.com.
Biocannabix Health Corporation (BCX), based in
Montreal, Quebec, is a biopharma nutraceutical Company focused on
delivering pediatric endo-medicinal nutraceuticals for cannabinoid
therapy.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Cautionary Note Regarding
Forward-Looking StatementsThis release includes certain
statements and information that may constitute forward-looking
information within the meaning of applicable Canadian securities
laws. All statements in this news release, other than statements of
historical facts, including statements regarding future estimates,
plans, objectives, assumptions or expectations of future
performance, including the timing and completion of the proposed
acquisitions, are forward-looking statements and contain
forward-looking information. Generally, forward- looking statements
and information can be identified by the use of forward-looking
terminology such as "intends" or "anticipates", or variations of
such words and phrases or statements that certain actions, events
or results "may", "could", "should", "would" or "occur".
Forward-looking statements are based on certain material
assumptions and analysis made by the Company and the opinions and
estimates of management as of the date of this press release,
including the assumptions that the Company will be able to apply
for and ultimately obtain an ACMPR licence, the proposed business
of Biocannabix will develop as anticipated, that the Company will
raise sufficient funds to develop the Biocannabix business, and
that the Company will obtain all requisite regulatory approvals.
These forward-looking statements are subject to known and unknown
risks, uncertainties and other factors that may cause the actual
results, level of activity, performance or achievements of the
Company to be materially different from those expressed or implied
by such forward-looking statements or forward-looking information.
Important factors that may cause actual results to vary, include,
without limitation, the risk that the proposed business
developments may not occur as planned; the timing and receipt of
requisite approvals and failure to raise sufficient funds.
Although management of the Company has attempted
to identify important factors that could cause actual results to
differ materially from those contained in forward-looking
statements or forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated or
intended. 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 forward- looking
statements and forward-looking information. Readers are cautioned
that reliance on such information may not be appropriate for other
purposes. The Company does not undertake to update any
forward-looking statement, forward-looking information or financial
outlook that are incorporated by reference herein, except in
accordance with applicable securities laws. We seek safe
harbor.
On Behalf of the Board of Directors
RELEVIUM TECHNOLOGIES
INC.
Aurelio UsechePresident and CEO
For more information about this press
release:
Tel: +1.888.528.8687
RELEVIUM TECHNOLOGIES INCEmail:
investors@releviumcorp.comWebsite: www.releviumtechnologies.com
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