Ignite International Brands : Q3 2021 - Condensed Interim Consolidated Financial Statements

Condensed Interim Consolidated

Financial Statements

For the periods ended September 30, 2021 and 2020

(These unaudited condensed interim consolidated financial statements, prepared by Management, have

not been reviewed by the Company's external auditor)

NOTICE OF NO AUDITOR REVIEW OF CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the unaudited condensed interim consolidated financial statements; they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The accompanying unaudited condensed interim consolidated financial statements of Ignite International Brands, Ltd. (the "Company") have been prepared and are the responsibility of the Company's management. The unaudited condensed interim consolidated financial statements are prepared in accordance with International Financial Reporting Standards and reflect management's best estimates and judgment based on information currently available.

The Company's independent auditor has not performed a review of these condensed interim consolidated financial statements in accordance with standards established by the Chartered Professional Accountants of Canada for a review of the condensed interim consolidated financial statements by an entity's auditor.

TABLE OF CONTENTS

PAGE

Condensed Interim Consolidated Statements of Financial Position	1
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss	2
Condensed Interim Consolidated Statements of Changes in Shareholders' Equity	3
Condensed Interim Consolidated Statements of Cash Flows	4
Notes to the Condensed Interim Consolidated Financial Statements	5

IGNITE INTERNATIONAL BRANDS, LTD.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(In Canadian Dollars)

	As at	As at
	September 30, 2021	December 31, 2020
	$	$
Assets
Current assets
Cash	4,662,894	5,462,783
Receivables (note 7)	7,570,299	1,594,306
Inventory (note 8)	11,645,530	12,499,793
Deposits (note 9)	11,022,710	370,254
Prepaid expenses (note 10)	1,307,134	2,091,655
Total current assets	36,208,567	22,018,791
Non-current assets
Long term receivable (note 7, 14)	3,096,188	3,017,973
Investments (note 11)	-	497,741
Property, plant and equipment, net (note 12)	492,462	568,906
Right of Use Assets, net (note 12)	5,084	27,963
Intangible assets, net (note 13)	274,734	301,808
Total noncurrent assets	3,868,468	4,414,391
Total assets	40,077,035	26,433,182
Liabilities
Current liabilities
Accounts payable and accrued liabilities (note 15)	10,827,344	3,259,668
Short term loans (note 16)	777,684	-
Short term convertible debt (note 16)	-	5,227,698
Due to related parties (note 23)	1,426	23,675
Short-term lease obligations (note 14)	-	24,589
Total current liabilities	11,606,454	8,535,630
Long Term Loans (note 16)	40,000	1,617,715
Convertible debenture liability (note 16)	14,703,520	4,478,575
Total long term liabilities	14,743,520	6,096,290
Total liabilities	26,349,974	14,631,920
Shareholders' equity
Share capital (note 17)	106,095,779	103,235,779
Warrant reserve (note 17)	726,863	726,863
Option Reserve (note 17)	2,417,576	2,570,689
Contributed surplus	8,160,456	6,770,911
Other comprehensive income	2,988,846	3,013,027
Non-controlling interests (note 20)	37,156	-
Accumulated deficit	(106,699,615)	(104,516,007)
Total shareholders' equity	13,727,061	11,801,262
Total liabilities and shareholders' equity	40,077,035	26,433,182
Nature of operations (note 1)	Approved by the Board
Segmented results (note 25)
Subsequent events (note 26)	/s/ "Dan Bilzerian" Director
Commitments and contingencies (note 24)	/s/ "Lester Lee" Director

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

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IGNITE INTERNATIONAL BRANDS, LTD.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS

(In Canadian Dollars)

		Three months ended		Three months ended			Nine months ended			Nine months ended
		September 30, 2021		September 30, 2020			September 30, 2021			September 30, 2020
		$		$			$			$
Sales revenue (note 19)	14,364,133		1,729,843		30,065,063	6,595,328
Cost of goods sold		11,396,724		1,238,578			22,112,332			4,610,360
Gross Profit	2,967,409	491,265		7,952,731	1,984,968
Operating expenses
General and administrative (note 22)	2,806,507		2,917,912		7,930,744	12,215,153
Share based payments (note 17)		155,518		(1,763,710)			(124,977)			11,671
Marketing and promotion	1,061,645		435,554		2,168,155	3,817,725
Depreciation (note 12)		37,346		111,648			112,307			1,884,307
Amortization (note 13)	12,699		15,153		37,790		39,827
Listing expense		38,993		22,039			80,863			72,336
Bad debt expense	321,318		(57,567)	572,893		278,601
Total operating expenses		4,434,026		1,681,029			10,777,775			18,319,620
Income (Loss) from operations	(1,466,617)		(1,189,764)	(2,825,044)		(16,334,652)
Other income
Debt Forgiveness (note 16)	-		-		1,558,136	-
Gain on debt extinguishment (note 16)		-		-			79,444			-
Gain on disposal of capital assets (note 12)	-		177,148		22,130		158,402
Investment gain (note 11)		34,942		(225,000)			230,944			90,000
Other income	773,499		-		1,121,219	-
Interest income		2,872		5,679			6,508			9,148
Total other income	811,313	(42,173)	3,018,381	257,550
Other expenses
Interest expense	72,583		26,877		279,732		236,078
Interest accretion, leases (note 14)		63		125,792			762			534,793
Interest accretion, convertible debentures (note	806,174		1,002,786		1,855,561	2,204,418
16)
Loss on Contingent Assets		-		3,385,250			-			3,385,250
Inventory impairment	-		70,140		-		70,140
Exchange gain/loss		102,748		(634)			100,146			31,412
Total other expenses	981,568		4,610,211		2,236,201	6,462,091
Net loss before taxes		(1,636,872)		(5,842,148)			(2,042,864)			(22,539,193)
Income tax	3,869		(30)	3,869		5,921
Net loss		(1,640,741)		(5,842,118)			(2,046,733)			(22,545,114)
Cumulative translation adjustment	736,374		(239,602)	(24,181)	724,368
Net loss and comprehensive loss		(904,367)		(6,081,720)			(2,070,914)			(21,820,746)
Net loss attributed to:
Ignite International Brands, Ltd.		(1,640,496)		(5,842,118)			(2,098,392)			(22,122,981)
Non-controlling interests	(245)	-		51,659		(422,133)
Net loss per share, basic and diluted (note 18)		(0.01)		(0.02)			(0.01)			(0.09)

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

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