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Lifeist Reports First Quarter 2022 Financial Results

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Lifeist Wellness Inc.
Lifeist Wellness Inc.

Continued Focus on Gross Margin Expansion Showing Success

TORONTO, April 29, 2022 (GLOBE NEWSWIRE) -- Lifeist Wellness Inc. (“Lifeist” or the “Company”) (TSXV: LFST) (FRANKFURT: M5B) (OTCMKTS: NXTTF), a health-tech company that leverages advancements in science and technology to build breakthrough companies that transform human wellness, today reported its financial results for the three months ended February 28, 2022 (“Q1 2022”) compared to the same period last year (“Q1 2021”). All financial figures are in Canadian dollars unless otherwise indicated.

First Quarter 2022 Highlights

  • Net revenue decreased 1% to $5.45 million in Q1 2022 (compared to $5.51 million in Q1 2021), entirely due to declines in hardware sales in Europe and medical cannabis sales in Canada, both operations having since been discontinued1. Excluding these two businesses, revenue increased 20% in Q1 2022 (compared to Q1 2021), led by Canadian recreational cannabis, Australian Vaporizers Pty Ltd (“Australian Vapes”) and Findify AB (“Findify”).

  • Gross profit before inventory adjustment tripled to $1.4 million in Q1 2022 as compared to $0.5 million in Q1 2021, the highest in the past two years, with margins expanding to 26% from 8%.

  • EBITDA improved substantially by narrowing losses to $4.2 million in Q1 2022 (compared to a $7.0 million loss in Q1 2021), representing the sixth consecutive quarter of EBITDA loss improvements. The Q1 2022 EBITDA loss was net of incremental investments into emerging businesses including approximately $650,000 in nutraceuticals.

  • Working capital position of $12.4 million at quarter end remains strong.

“Our first quarter results reflect progress and momentum in our transition to a wellness-driven company,” said Meni Morim, CEO of Lifeist. “We have sharpened our focus within cannabis on our B2B platform and this in turn is fueling meaningful increases in gross profit for all of Lifeist. We accomplished a tripling of gross profit versus the same quarter last year while simultaneously winding down unprofitable businesses and investing in our wellness future. This includes scaling our innovative health-tech company Mikra, which is going after the large and growing nutraceuticals market, and seeing promising early consumer interest for its first product which commenced pre-sales last month.”

Mr. Morim continued, “We have also been optimizing the wellness portfolio with moves designed to improve our financials and provide value for shareholders. In addition to exiting the consumer-focused medical cannabis by transferring patients to a third-party, we formally ceased operations of Lifeist Bahamas which sold hardware in Europe through the ecommerce website. As we execute on our wellness strategy, we are confident that the assets at the heart of the Lifeist value proposition will deliver sustained and tangible shareholder value.”

Operating Highlights

Cannabis (CannMart Inc. (“CannMart”) and CannMart Labs Inc. (“CannMart Labs”))

  • Recreational cannabis continues to be Lifeist’s largest driver of performance accounting for 58% of the Company’s net revenue in Q1 2022, with growing gross margins, improved inventory management, an expanded distribution network, and bringing an award winning brand to market.

  • CannMart completed the successful transfer of registered medical patients to Medicibis, operators of, in February 2022. The agreement is part of the Company’s strategic initiative to sharpen its focus on B2B recreational cannabis and nutraceuticals.

  • The cannabis B2B gross margin increased to $0.7 million in Q1 2022 as compared to a negative gross margin of $0.9 million in Q1 2021, continuing the positive trend seen throughout 2021 (Q1 -$0.9 million, Q2 -$0.4 million, Q3 $0.2 million, Q4 $0.5 million), driven by sales of higher-margin Roilty products and improved overhead efficiencies.

  • After establishing a supply agreement with the Société Québécoise du Cannabis (“SQDC”) in March 2022, CannMart is now approved for the sale of cannabis and cannabis-derived products from provincial and territorial bodies in Ontario, Alberta, British Columbia, Quebec, Manitoba, New Brunswick, Saskatchewan, Yukon, Nunavut and the Northwest Territories, which provides it with access to 95% of Canada’s population.

  • CannMart Labs’ state-of-the-art BHO extraction facility commenced manufacturing and shipping product in November 2021, and in January 2022, its in-house brand “Roilty”, launched earlier in 2021, won the prestigious “Canadian LP Brand of the Year” award at the 2021 ADCANN Awards. Roilty product is now live in Alberta, Saskatchewan, Manitoba, Yukon, the Northwest Territories and Nunavut with purchase orders in place for distribution in Ontario.

Nutraceuticals (Mikra)

  • Mikra launched its first product, CELLF, a novel cellular therapeutic compound targeting systemic fatigue, and after launching pre-sales in March 2022, began shipping and deliveries in April 2022. In partnership with InVivo Biosystems, Mikra has commenced its genomic and transcriptomic clinical studies to gather evidence for CELLF™ at a molecular and cellular level. These in vivo studies will demonstrate how CELLF™ impacts healthy aging and inflammation pathways at a cellular level.

  • In April 2022, Mikra expanded its professional athlete roster with Olympic medalists Ashley Wagner and Cullen Jones. Ashley and Cullen join baseball hero Jose Bautista who joined Mikra in November 2021 to ideate and launch a new athletic therapeutic.

Australian Vapes

  • The major flooding that significantly disrupted Australian Vapes did not occur until the final days of February such that the business continued to have another strong quarter in Q1 2022. The solid performance was characterized by website traffic growth and positive unit economics, which drove the highest Q1 revenue ever of $1.7 million compared to $1.5 million in Q1 2021, representing an increase of 12%, with EBITDA margins expanding to 14% from 9% in Q1 2021.

  • Australian Vapes has moved quickly to restore normal operations after the flooding rendered its leased warehouse facility in Brisbane unviable. On April 1, the team executed a five-year lease at a new location in Banyo, Queensland, which is larger, has an improved layout, delivery bay and overall condition, and re-launched sales on April 25, 2022. Results in the few days since the re-launch have seen average order values (AOVs) and conversion rates return to pre-shutdown levels, supporting our view that Australian Vapes will quickly resume its highly stable, predictable financial performance.


  • Findify delivered another record quarter, with revenue of $588,000 in Q1 2022 compared to $401,000 in Q1 2021, representing an increase of 47%. The accelerated growth is coming from the strategic plan, which was launched in mid-2021, sharpening Findify’s focus on product innovation and catering to higher tier customers. The most significant release is a new infrastructure that allows for real time synchronization of any product data with Shopify.

  • EBITDA loss increased to $447,000 in Q1 2022 as compared to $265,000 in Q1 2021 due to strategic investments in various innovation initiatives to help drive long-term revenue growth.

Financial Summary of Q1 2022

Net revenue decreased 1% to $5.45 million in Q1 2022 compared to $5.51 million in Q1 2021. The decrease was driven by the planned wind down of hardware sales in Europe through Lifeist Bahamas and medical cannabis sales in Canada through CannMart, with these operations effectively ceasing in 2022. This was offset by the continued growth in sales of Canadian recreational cannabis, Findify SaaS revenue which increased 47%, and Australian Vapes hardware revenue which increased 12%. Excluding Lifeist Bahamas hardware and CannMart medical cannabis, net revenue increased 20%.

Gross margin was 26% of net revenue in Q1 2022 compared to 8% in Q1 2021. The improvement was due to production efficiencies across all segments and the focus on higher value-added revenue streams in the B2B and recreational markets. Within recreational cannabis, gross margins improved to $1.4 million in Q1 2022 compared to a $0.5 million negative margin in Q1 2021, particularly due to Roilty product sales.

EBITDA loss narrowed to $4.2 million in Q1 2022 compared to $7.0 million in Q1 2021, due to higher gross margins and improved performance across most business units, and represented the sixth consecutive quarter of EBITDA loss improvements. The reduced EBITDA loss was net of incremental investments in emerging businesses including approximately $650,000 in nutraceuticals.

Net loss was $4.6 million in Q1 2022 compared to $7.4 million in Q1 2021, due to improved gross margins and lower non-operating write-downs, as compared to Q1 2021.

Balance Sheet and Cash Flow

Cash and cash equivalents were $9.2 million as of February 28, 2022, compared to $12.7 million as of November 30, 2021.

Inventories increased to $6.4 million at February 28, 2022 compared to $5.4 million at November 30, 2021, mainly due to new inventory purchased for CannMart Labs and Mikra, both which started their own production in Q1 2022.

Net cash used in operations was $3.4 million in Q1 2022 compared to $2.5 million in Q1 2021. The increase was largely due to investments in emerging businesses including CannMart Labs and Mikra.

Other Item

During the quarter, Fire & Flower Holdings Corp. (“Fire & Flower”) purchased Pineapple Express Delivery Inc. (“PED”), a holder of the Company’s convertible loan payable. As part of the purchase, Fire & Flower assumed and repaid a $2,040,077 convertible loan receivable owed to the Company by PED. In addition, the Company received 75,100 common shares in Fire & Flower, with a further 258,478 common shares in Fire & Flower having been placed into escrow pending completion of customary working capital adjustments and subject to achievement of certain performance-based milestones in its fiscal 2022 year.

Additional Information

The Company’s complete financial statements and management’s discussion & analysis (“MD&A”) for Q1 2022 are available on Lifeist’s website ( and SEDAR (

About Lifeist Wellness Inc.

Sitting at the forefront of the post-pandemic wellness revolution, Lifeist leverages advancements in science and technology to build breakthrough companies that transform human wellness. Portfolio business units include: CannMart, which operates a B2B wholesale distribution business facilitating recreational cannabis sales to Canadian provincial government control boards; CannMart Labs, a BHO extraction facility for the production of high margin cannabis 2.0 products; the marketplace, which provides U.S. customers with access to hemp-derived CBD and smoking accessories; Australian Vapes, Australia’s largest online retailer of vaporizers and accessories; Findify, a leading AI-powered search and discovery platform; and Mikra, a biosciences and consumer wellness company seeking to develop innovative therapies for cellular health.

Information on Lifeist and its businesses can be accessed through the links below:

Lifeist Wellness Inc.
Meni Morim, CEO
Matt Chesler, CFA, Investor Relations
Ph: 647-362-0390

Neither the 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 or has in any way approved or disapproved of the contents of this press release.

Non-IFRS Financial Measures

Management evaluates the Company’s performance using a variety of measures, including “Net loss before income tax, depreciation and amortization” and “Adjusted EBITDA”. The non-IFRS measures discussed below should not be considered as an alternative to or to be more meaningful than revenue or net loss. These measures do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.

The Company believes these non-IFRS financial measures provide useful information to both management and investors in measuring the financial performance and financial condition of the Company.

Management uses these and other non-IFRS financial measures to exclude the impact of certain expenses and income that must be recognized under IFRS when analyzing consolidated underlying operating performance, as the excluded items are not necessarily reflective of the Company’s underlying operating performance and make comparisons of underlying financial performance between periods difficult. From time to time, the Company may exclude additional items if it believes doing so would result in a more effective analysis of underlying operating performance. The exclusion of certain items does not imply that they are non-recurring.

(i) Current and deferred income taxes, depreciation and amortization, and share-based compensation were excluded from the Adjusted EBITDA calculation as they do not represent cash expenditures.
(ii) Other income consisting of gain on disposal of subsidiary, interest income, realized gain on disposition of AFS investments, unrealized gain on derivatives and other miscellaneous non-recurring income were excluded from Adjusted EBITDA calculation.
(iii) Non-recurring costs related to restructuring and legacy issues were excluded from Adjusted EBITDA calculation.
(iv) Impairment loss relating to goodwill, customer list, domains and brand names were excluded from Adjusted EBITDA calculation.
(v) Impairment loss relating to receivable is a provision for expected credit loss to an associate and was excluded from Adjusted EBITDA calculation.
(vi) Share of associates loss, net of tax, is excluded due to lack of control.

Forward Looking Information

This news release contains “forward-looking information” within the meaning of applicable securities laws. All statements contained herein that are not historical in nature contain forward-looking information. Forward-looking information can be identified by words or phrases such as “may”, “expect”, “likely”, “should”, “would”, “plan”, “anticipate”, “intend”, “potential”, “proposed”, “estimate”, “believe” or the negative of these terms, or other similar words, expressions and grammatical variations thereof, or statements that certain events or conditions “may” or “will” happen.

The forward-looking information contained herein, including, without limitation, statements related to: the Company’s continuing focus on B2B recreational cannabis and nutraceuticals and its expectations from such businesses to deliver sustained and tangible shareholder value are made as of the date of this press release and is based on assumptions management believed to be reasonable at the time such statements were made, including, without limitation, Lifeist’s ability to continue to increase revenue through its B2B recreational cannabis business and to maintain momentum of expanding its nutraceutical business, its ability to broaden its total addressable market and to evolve into a recognized wellness company, the Company’s expectation that the nutraceutical and wellness market will develop as currently anticipated, the nutraceutical market will continue to be a multi-billion dollar high-margin market, the introduction of new products and brands will generate additional revenue, expectations that CELLF and other cellular health products and accessories to be developed by the Company will gain market acceptance along with the expansion of the market for nutraceutical products, as well as other considerations that are believed to be appropriate in the circumstances. While we consider these assumptions to be reasonable based on information currently available to management, there is no assurance that such expectations will prove to be correct. By its nature, forward-looking information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. A variety of factors, including known and unknown risks, many of which are beyond our control, could cause actual results to differ materially from the forward-looking information in this press release. Such factors include, without limitation: the inability of the Company to develop its business as anticipated and to increase revenues and/or its profitable margin on such revenues, unanticipated changes to current regulations that would adversely impact the Company’s businesses, the unanticipated decline in demand for cannabis products, competition from others, unforeseen developments that would delay Mikra’s ability to sell CELLF and any other developed nutraceutical product as anticipated and in a timely manner, the risk that pre-clinical trials relating to CELLF are not as successful as anticipated and do not demonstrate the expected therapeutic benefits and/or fail to strengthen the Company’s patent claim, the risk that the expected demand for nutraceutical products in general and those of Mikra in particular does not develop as anticipated, the failure to convert the current number of subscribers on the pre-sales waitlist to actual sales, regulatory risk, risks relating to the Company’s ability to execute its business strategy and the benefits realizable therefrom and risks specifically related to the Company’s operations. Additional risk factors can also be found in the Company’s current MD&A and annual information form, both of which have been filed under the Company’s SEDAR profile at Readers are cautioned not to put undue reliance on forward-looking information. The Company undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

Source: Lifeist Wellness Inc.

1 The Company has discontinued operations of: CannMart Inc.’s medical cannabis business including online sales of hardware and accessories in Canada; CannMartMD Inc. (booking platform for Canadian medical cannabis consultations); and Lifeist Bahamas (hardware sales in Europe), as part of its strategy to focus resources on growing existing businesses and its new nutraceuticals and biosciences division.

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