40% growth compared to the second quarter 2022 capturing channel, category, and innovation expansion in clean-ingredient food, next generation skincare, and plant-based wellness
- TRUBAR Protein Bar: As a result of TRUBAR exceeding the bar category sales velocities at Costco, TRUBAR was able to access national distribution at Costco during the quarter. Supporting the brands' continued expansion are four initiatives: manufacturing capacity expansion, continued omni-channel distribution growth with retailers like Sodexo, bar flavor extensions, and the entry into the
$21.5 billion protein powder category in 2023, per Global Market Insights. Back half 2023 commitments reflect a planned regional placement of a second and additional item in select Costco regions, as well as expansion into BJ's Wholesale,Circle K , and Andretti Oil. - PureKana Wellness: PureKana, a leading plant-based wellness brand, remained focused on its customer acquisition initiative, adding over 61,925 customers during the quarter and replenishing the sales funnel into a subscription model. To expand beyond human consumption, PureKana announced its 2023 entry into the
$196 million hemp-based pet category (perGrandview Research ) with offerings in with calming chews, hip & joint chews, and hair & coat drops. As an estimated 60% of PureKana's loyal customers have pets, the growth opportunity is expected to be sizeable. - No B.S. Skincare: Originally, the No B.S. brand was sourced exclusively online at livenobs.com and Amazon. In 2022, the brand entered 3,200 CVS Health stores for a Back-to-School Event and continues to maintain a on shelf presence in CVS's healthy skin section. Initial brick and mortar success had the brand enter TJ Maxx in Q2, with a planned national launch into Walgreen's in Q4 2023. Sources of growth include omni-channel expansion supported by insight-driven innovation with an expanded facial acne patch portfolio (overnight pimple patch and acne patch plus retinol night cream) and a natural deodorant category entry.
- Vibez Wellness: The Vibez Wellness line was launched in
November 2022 to capture incremental millennial consumers on their preventative wellness journey. With an initial keto gummy supplement offering, the new brand has achieved$1.7M in revenue with a gross margin of 73% year-to-date 2023. Vibez's primary focus is non-CBD solutions into the weight management, focal acuity, and healthy hair consumer need states. Through portfolio and channel expansion, Vibez is forecasted to exceed$7.0M with an expected gross margin of 73% in 2023.
"As our Q2 2023 financial and commercial results illustrate, we are positioned for continued revenue growth, profit improvement, and debt reduction in 2023. Our strategic priorities remain to lead consumer-centric innovation and relentlessly acquire customers to these emerging brands by driving category and channel expansion. Even with our marketing and capability investments in Q2, we remain confident in delivering the current 2023 outlook of
For the three months ended | ||||||
Change | ||||||
expressed in millions * | $ | % (in terms of revenue) | $ | % (in terms of revenue) | $ | % |
Revenue | 23.60 | 100 % | 16.90 | 100 % | 6.70 | 40 % |
Cost of goods sold | (9.90) | (42 %) | (5.20) | (31 %) | (4.70) | 90 % |
Gross profit | 13.70 | 58 % | 11.70 | 69 % | 2.00 | 17 % |
Revenue for the second quarter of 2023 was
SBBC's cost of sales increased in the second quarter relative to the comparable period 2022 by 11 percentage points due to a higher mix of lower margin retails sales (38% of Q2 sales compared to 12% of sales in Q2 2022) which has lower gross margins than online sales. The Company continues to manage its finished goods costs with co-manufacturers with the higher order volumes it has been able to place. Cost of goods sold for online sales (Direct to Consumer "DTC") typically range in the low to mid 70's and retailer (Business to Business "B2B") gross margins range in the mid 30's to higher 40's. Cost of goods sold was
Gross profit for the second quarter of 2023 was
Operating costs for the second quarter of 2023 were
Other expenses for the second quarter 2023 were
The Company incurred a net loss of
EBITDA and Adjusted EBITDA are non-GAAP measures used by management that are not defined by IFRS. EBITDA and Adjusted EBITDA do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. Management believes that EBITDA and Adjusted EBITDA provide meaningful and useful financial information as these measures demonstrate the operating performance of a business excluding non-cash charges.
The most directly comparable measure to EBITDA and Adjusted EBITDA calculated in accordance with IFRS is net loss. The following table presents the EBITDA and Adjusted EBITDA for the three months ended
For the three months ended | ||||
Change in | ||||
$ | $ | $ | % | |
Net loss | (6.30) | (2.30) | (4.00) | 63 % |
Amortization | 1.00 | 0.60 | 0.40 | 40 % |
Finance costs | 0.40 | 0.20 | 0.20 | 50 % |
EBITDA | (4.90) | (1.50) | (3.40) | 153 % |
Acquisition-related costs | - | (0.10) | 0.10 | 100 % |
Acquisition costs paid by common shares | - | 0.20 | (0.20) | 100 % |
Fair value adjustment of derivative liability | 0.10 | - | 0.10 | 100 % |
Impairment of intangible assets | 0.20 | - | 0.20 | 100 % |
Impairment of inventories | 0.20 | - | 0.20 | 100 % |
Impairment of receivable | 0.10 | - | 0.10 | 100 % |
Loss on remeasurement of warrant liabilities | 0.70 | - | 0.70 | 100 % |
Share-based payments | 0.50 | 1.60 | (1.10) | (220 %) |
Shares issued for services | - | 0.30 | (0.30) | 100 % |
Write-off of advance payments | - | 0.40 | (0.40) | 100 % |
Non-recurring expenses | 0.70 | - | 0.70 | 100 % |
Adjusted EBITDA | (2.40) | 0.90 | (3.30) | 933 % |
The Company had an adjusted EBITDA loss of
Our 2023 Outlook remains unchanged:
1. The Company's expectation for consolidated net sales to exceed
2. The Company expects gross margin as a percentage of net sales to be between 58% and 60%.
3. The Company expects to achieve positive Adjusted EBITDA in the range of
A conference call to discuss the results is scheduled for the following day on
Simply Better Brands Corp. leads an international omni-channel platform with diversified assets in the emerging plant-based and holistic wellness consumer product categories. The Company's mission is focused on leading innovation for the informed Millennial and Generation Z generations in the rapidly growing plant-based, natural, and clean ingredient space. The Company continues to focus on expansion into high-growth consumer product categories including plant-based food, clean ingredient skincare and plant-based wellness. For more information on
https://www.simplybetterbrands.com/investor-relations.
Neither the
Certain statements contained in this news release constitute "forward-looking information" and "forward looking statements" as such terms are used in applicable Canadian securities laws. Forward-looking statements and information are based on plans, expectations and estimates of management at the date the information is provided and are subject to certain factors and assumptions, including, among others, that the Company's financial condition and development plans do not change as a result of unforeseen events, the impact of the COVID-19 pandemic, the regulatory climate in which the Company operates, and the Company's ability to execute on its business plans. Specifically, this news release contains forward-looking statements relating to, but not limited to: entry into the
Forward-looking statements and information are subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking statements and information. Factors that could cause the forward-looking statements and information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to prove not to be valid or reliable, that occurrences such as those referred to above are realized and result in delays, or cessation in planned work, that the Company's financial condition and development plans change, ability to obtain necessary regulatory approvals for proposed transactions, as well as the other risks and uncertainties applicable to the plant-based food, clean ingredient skincare and plant-based wellness or broader wellness industries and to the Company, and as set forth in the Company's annual information form available under the Company's profile at www.sedar.com.
The above summary of assumptions and risks related to forward-looking statements in this news release has been provided in order to provide shareholders and potential investors with a more complete perspective on the Company's current and future operations and such information may not be appropriate for other purposes. There is no representation by the Company that actual results achieved will be the same in whole or in part as those referenced in the forward-looking statements and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities law.
This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about the financial results the quarter ended
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