GREENSPACE BRANDS INC. REPORTS FISCAL 2022 RESULTS, HIGHLIGHTING IMPROVEMENTS IN GROSS PROFIT PERCENTAGE AND ADJUSTED EBITDA VERSUS PRIOR YEAR
SUMMARY RESULTS OF FISCAL 2022:
Gross Revenue from continuing operations was $18.3 million, representing a (37.8%) decrease compared to the same prior-year period
Selling, General and Administrative (“SG&A”) expenses of $6.6 million improved by 43.0% or $5.1 million compared to $11.7 million in the prior year1 with significant reductions in general and administrative expenses, salaries and benefits, storage and delivery expenses and professional fees. These improvements reflect the Company’s progress on significantly reducing SG&A expenses as it executes its Project FIT initiatives.
Net Loss of ($10.2) million, compared with ($20.8) million in the prior year1, primarily reflects significantly reduced SG&A expenses (by $5.1 million), lower non-cash impairment charges (by $6.2 million) and a restructuring gain (of $0.6 million) partially offset by increased interest and accretion expense (by $0.6 million) and lower foreign exchange gains (by $0.7 million).
Adjusted EBITDA of ($3.8) million was improved 41.1% or $2.6 million compared to the prior year1, reflecting the matters described above.
Twelve-month period ended March 31, 2022 compared to the twelve-month period ending March 31, 2021.
“This past year we have been implementing our new Focused Growth Strategy across the business and heightening our drive towards profitable growth,” said Shawn Warren, President and CEO of GreenSpace Brands Inc. “We are seeing encouraging progress with stronger service levels, broader retailer support, new distribution wins with large retailers and continued momentum from Project FIT cost savings initiatives. Better inventory levels are supporting our efforts to improve pricing, build consumption with customer promotions, expand margin-accretive innovations and accelerate our route-to-market excellence initiatives. To address inflationary pressures across our industry, we have announced a series of additional pricing actions to retail and foodservice customers. Overall, Management is optimistic that Fiscal 2023 will see continued adjusted EBITDA improvements with improved topline growth and better gross profit percentages.”
Management believes that its new Vision, Strategic Plan and implementation of its Focused Growth Strategy will lead to improvements in adjusted EBITDA that will continue into subsequent years. The Company has improved customer service levels across all three of its branded businesses, leading to the resumption of widespread promotional activities with select retailers. The Company has been able to regain distribution with certain strategic customers and has been able to make inroads into launching margin-accretive new products and new channel growth across e-commerce platforms. Aligned with its Focused Growth Strategy, Management has prioritized improvements in gross profit percentage and overall profitability through better product mix, price increases and enhanced cost management at all levels.
GreenSpace has been able to rebuild credibility with its supplier base and renegotiate payment terms with a number of key suppliers across its ingredient and manufacturing network. While rebuilding customer revenue momentum may take time after the working capital challenges of the previous two years, Management expects that the foundational elements have been established to deliver improvements in both topline performance and profitability. Management believes that the continued implementation of its Focused Growth Strategy will drive improvements in the operation over time and remains optimistic that this initiative will improve adjusted EBITDA to help finance the future growth opportunities available to the Company.