Vancouver, British Columbia--(Newsfile Corp. - April 27, 2023) - good natured Products Inc. (TSXV: GDNP) (OTCQX: GDNPF) (the "Company" or "good natured®"), a North American leader in plant-based products, today announced its financial results for the three months ("Q4 2022") and twelve months ("FY2022") ended December 31, 2022. The Company also announced that it will host a webcast investor presentation on May 3, 2023 at 2:00 PM Eastern / 11:00 AM Pacific time.
"This was a historic year for good natured® where we achieved a major milestone of over $100 million in revenue and executed our strategic goal to expand our Packaging business group though strong organic growth," stated Paul Antoniadis, CEO of good natured®. "In addition, we made significant progress on improving profitability, generating our first full year of positive adjusted EBITDA1 with a strong focus on cash management in the face of volatile macroeconomic conditions."
Paul added: "As we stated at the time of our Q3 2022 results, we had seen some signs of reduced demand for our industrial products as customers continued to work through high inventory levels. Although this trend in our Industrial business group continued as anticipated through Q4 2022 and into early 2023, our pipeline for eco-friendly packaging remains very robust. Recent policy developments, including the White House announcing incentives to transition 90% of plastics to bio-based feedstock within 20 years, are providing the Company with tremendous potential for long term growth and value creation."
Key Highlights:
- Revenues for Q4 2022 increased 2% to $23.3 million compared to $22.9 million for the three months ended December 31, 2021 ("Q4 2021"). FY2022 revenues increased 65% to a record $101.0 million compared to $61.1 million for the twelve-month period ended December 31, 2021 ("FY2021").
- Variable gross profit1 for Q4 2022 increased 10% to $7.7 million, representing a variable gross margin1 of 33%, compared to $7.0 million and 31% for Q4 2021. Variable gross profit for FY2022 increased 69% to $33.2 million, 33% of sales, compared to $19.7 million, 32% of sales, in FY2021.
- Gross profit for Q4 2022 increased 9% to $5.8 million representing a gross margin of 25%, compared to $5.3 million and 23% respectively for Q4 2021. Gross profit for FY2022 increased 68% to $26.3 million, 26% of sales, compared to $15.6 million, 26% of sales, in FY2021.
- Selling, general and administrative expenses ("SG&A"), excluding acquisition activity and one-time charges,1 for Q4 2022 and FY2022 were $4.0 million and $15.7 million compared to $3.2 million and $10.2 million for Q4 2021 and FY2021. As a percent of sales, SG&A expenses, excluding acquisition activity and one-time charges,1 was 17% for Q4 2022 and 16% for FY2022 compared to 14% in Q4 2021 and 17% in FY2021.
- SG&A expenses for Q4 2022 and FY2022, were $4.9 million and $17.9 million compared to $4.1 million and $12.8 million for Q4 2021 and FY2021. As a percent of sales, SG&A expenses was 21% for Q4 2022 and 18% for FY2022 compared to 18% in Q4 2021 and 21% in FY2021.
- Cash generated by operating activities for FY2022 was $4.6 million compared to $13.7 million used by operating activities for FY2021.
- Net working capital improved to $10.0 million as at December 31, 2022, compared to a deficit of $16.0 million as at December 31, 2021.
- Cash and cash equivalents improved to $11.9 million as at December 31, 2022, compared to $10.7 million as at December 31, 2021.
- The Company's adjusted EBITDA1 for Q4 2022 and FY2022 was nil and $3.0 million respectively, compared to $0.5 million for Q4 2021 and a loss of $0.1 million for FY2021.
- In Q4 2022, the Company incurred a net loss of $4.9 million compared to a net loss of $4.2 million in Q4 2021. Net loss for FY2022 was $11.6 million compared to a net loss of $12.7 million in FY2021.
The Company's Q4 2022 and FY2022 financial statements and Management's Discussion and Analysis are available on SEDAR at sedar.com and on the Company's investor website at investor.goodnaturedproducts.com.
Investor Webcast on May 3, 2023
The Company also announced that it will host an investor webcast on Thursday, May 3, 2023 at 2:00 PM Eastern / 11:00 AM Pacific time.
During the webcast, Paul Antoniadis, Chief Executive Officer of good natured®, will provide a presentation covering key areas of the business. After the formal presentation, attendees will have an opportunity to ask questions through an interactive Q&A portal.
To attend the webcast, please pre-register at the following link:
https://event.webcasts.com/starthere.jsp?ei=1607430&tp_key=63de3a7c8b.
An archived version of the webcast and presentation will be available on the Company's website at investor.goodnaturedproducts.com.
The good natured® corporate profile can be found at: investor.goodnaturedproducts.com.
About good natured Products Inc.
good natured® is passionately pursuing its goal of becoming North America's leading earth-friendly product company by offering the broadest assortment of plant-based products made from rapidly renewable resources instead of fossil fuels. The Company is focused on making it easy and affordable for business owners and consumers to shift away from petroleum to better everyday products® that use more renewable materials, less fossil fuel, and no chemicals of concern.
good natured® offers over 400 products and services through wholesale, direct to business, and retail channels. From plant-based home organization products to certified compostable food containers, bio-based industrial supplies and medical packaging, the Company is focused on making plant-based products more readily accessible to people as a means to create meaningful environmental and social impact.
For more information: goodnaturedproducts.com.
On behalf of the Company:
Paul Antoniadis - Executive Chair & CEO
Contact: 1-604-566-8466
Investor Contact:
Spencer Churchill
Investor Relations
1-877-286-0617 ext. 113
invest@goodnaturedproducts.com
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibilities for the adequacy or accuracy of this release.
Non-GAAP Financial Measures
We have included in this press release a discussion of the Company's variable gross profit, variable gross margin, SG&A excluding acquisition activity and one-time charges, and adjusted EBITDA all non-GAAP measures, for Q4 2022, FY2022, Q4 2021 and FY2021 to provide, what management believes, is a meaningful comparison of the Company's performance in Q4 2022 and FY2022. These non-GAAP measures do not have standardized meanings, and therefore may not be comparable to similar measures presented by other issuers. Variable gross profit, variable gross margin, SG&A excluding acquisition activity and one-time charges, and adjusted EBITDA are more fully defined and discussed in the Company's Q4 2022 and FY2022 Management's Discussion and Analysis under the heading "non-IFRS financial measures", which is available on the Company's SEDAR profile at www.sedar.com and on the Company's investor website at investor.goodnaturedproducts.com.
The following table provides a reconciliation of net loss to adjusted EBITDA for the periods ended:
| 3 mon. ended Dec 31 | Year ended Dec 31 | |||||||||||||||||
| 2022 | 2021 | +/- | 2022 | 2021 | +/- | |||||||||||||
| Net loss for the period | (4,912) | (4,175) | 18% | (11,582) | (12,695) | -9% | ||||||||||||
| Share-based compensation | 594 | 498 | 19% | 2,150 | 2,254 | -5% | ||||||||||||
| Depreciation | 514 | 253 | 103% | 1,950 | 1,071 | 82% | ||||||||||||
| Depreciation in COGS & SG&A | 442 | 284 | 56% | 1,662 | 926 | 79% | ||||||||||||
| Financing costs | 1,863 | 1,618 | 15% | 5,550 | 4,552 | 22% | ||||||||||||
| Foreign exchange loss (gain) | 695 | 262 | 165% | 847 | 315 | 169% | ||||||||||||
| Gain on WINN Loan | - | (42) | -100% | (15) | (85) | -82% | ||||||||||||
| Loss on financing | - | 936 | -100% | 449 | 1,148 | -61% | ||||||||||||
| Acquisition related expenses & one time charges | 863 | 886 | -3% | 2,164 | 2,572 | -16% | ||||||||||||
| Deferred income taxes recovery | (54) | 20 | -370% | (216) | (126) | 71% | ||||||||||||
| Adjusted EBITDA1 | 5 | 540 | -99% | 2,959 | (68) | -4451% | ||||||||||||
The following table provides a reconciliation of variable gross profit to gross profit and variable gross margin to gross margin for the periods ended:
| 3 mon. ended Dec 31 | Year ended Dec 31 | |||||||||||||||||
| 2022 | 2021 | +/- | 2022 | 2021 | +/- | |||||||||||||
| Revenue | 23,306 | 22,860 | 2% | 100,966 | 61,132 | 65% | ||||||||||||
| Variable cost of product | 15,652 | 15,880 | -1% | 67,744 | 41,462 | 63% | ||||||||||||
| Variable gross profit1 | 7,654 | 6,980 | 10% | 33,222 | 19,670 | 69% | ||||||||||||
| Variable gross margin % | 32.8% | 30.5% | 32.9% | 32.2% | ||||||||||||||
| Fixed factory overhead | 1,846 | 1,650 | 12% | 6,900 | 4,033 | 71% | ||||||||||||
| Gross profit | 5,808 | 5,330 | 9% | 26,322 | 15,637 | 68% | ||||||||||||
| Gross margin % | 24.9% | 23.3% | 26.1% | 25.6% | ||||||||||||||
The following table provides a reconciliation of selling, general and administrative expense excluding acquisition activity and one-time charges:
| 3 mon. ended Dec 31 | Year ended Dec 31 | |||||||||||||||||
| 2022 | 2021 | +/- | 2022 | 2021 | +/- | |||||||||||||
| SG&A Wages | 2,468 | 1,517 | 63% | 9,488 | 5,700 | 66% | ||||||||||||
| SG&A Other | 1,370 | 1,514 | -10% | 5,479 | 4,030 | 36% | ||||||||||||
| Product Development expense | 182 | 194 | -6% | 741 | 519 | 43% | ||||||||||||
| Acquisition related expenses & one-time charges | 863 | 886 | -3% | 2,164 | 2,572 | -16% | ||||||||||||
| SG&A | 4,883 | 4,111 | 19% | 17,872 | 12,821 | 39% | ||||||||||||
| SG&A % of Revenue | 21% | 18% | 18% | 21% | ||||||||||||||
| SG&A excluding acquisition activity & one-time charges | 4,020 | 3,225 | 25% | 15,708 | 10,249 | 53% | ||||||||||||
| SG&A % of Revenue excluding acquisition related & One-Time charges | 17% | 14% | 16% | 17% | ||||||||||||||
| SG&A Wages % of Revenues | 11% | 7% | 9% | 9% | ||||||||||||||
Cautionary Statement Regarding Forward-Looking Information
This news release contains forward-looking information within the meaning of securities laws including statements related to Company plans and focuses for 2023, and management's outlook for 2023.
By their nature, forward-looking statements involve known and unknown risks, uncertainties, changes in circumstances and other factors that are difficult to predict and many of which are outside of the Company's control which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
Forward-looking information contained in this news release is based on our current estimates, expectations and projections regarding, among other things, future plans and strategies, projections, anticipated events and trends, general market conditions, the economy, sales volume and pricing and other future conditions which we believe are reasonable as of the current date. Important factors that could cause actual results and financial conditions to differ materially from those indicated in the forward-looking statements include, among others risks relating to general economic, market and business conditions and unforeseen delays in the realization of the Company's plans. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date.
If relying on the Company's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed that the material factors referred to herein will not cause such forward-looking statements and information to differ materially from actual results or events. However, there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
Other than as required under securities laws, we do not undertake to update this information at any particular time.
All forward-looking information contained in this news release is expressly qualified in its entirety by this cautionary statement.
1 A non-GAAP financing measure. Please refer to the "Non-GAAP Financial Measures" below for an explanation of these measures and reconciliation to the Company's financial results reported in accordance with GAAP.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/163838
