(via TheNewswire)
Highlights for the Year:
DehydraTECH Licensing Revenues Nearly Tripled vs. Year Ago (as Adjusted*) as New Licensees and New Product Launches Continue to Hit the Market
FY 2023 Consolidated Gross Profit Showed Strong Growth at +20% vs. Year AgoBuilding on the +37% Gross Profit Gain for Full-Year FY2022
We Continued to Execute the Transformed Vin(Zero) Business Model
Cash Flows from Operations Improved Significantly With a 59% Improvement
Completed Our Balance Sheet Transformation, Delivering More Streamlined Financials and Eliminating Items Not Relevant for Our Focused Growth Agenda
DehydraTECH Licensing Revenues Nearly Tripled vs. Year Ago (as Adjusted*) as New Licensees and New Product Launches Continue to Hit the Market
The continued growth of our DehydraTECH licensing business is a function of four key factors:
new licensees- increasing our base of active licensees and brands;
new states– new state launches expanding the geographic coverage for active licensees or brands;
new product form factors– innovation to expand the number of DehydraTECH-powered consumer product forms and types in market to fill consumer needs and occasions; and
deeper penetration of products across operations– driving deeper penetration of the breadth of product forms and brands across current and new states.
Following is a summary of the significant advances we have made against these key factors since we acquired the exclusive global rights to the DehydraTECH technology for use with THC products at the end of 2020 until the close of FY 2023.
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The thirteen states where we currently have active operating partners represent a total population of 150MM1and an addressable market of approximately
The following chart shows the growth in DehydraTECH licensing revenues over the last 3 fiscal years:
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*Licensing revenues have been adjusted to reflect bad debts recognized in subsequent periods related to the previous year’s revenue.
We Continued to Execute the Transformed Vin(Zero) Business Model
As outlined in previous communications, we transformed our Vin(Zero) business model at the end of FY 2022, with major adjustments across all the key areas of production planning, shipping and logistics, warehousing, sales and retail distribution. These changes have led to several key positive financial impacts:
shortened our order-to-cash cycle;
reduced the level of working capital that we hold in finished goods inventory;
reduced warehousing and transportation costs with streamlined distribution;
Reduced the need for more expensive temperature-controlled containers for our products as our forecasting, operations planning, and inventory logistics models create a more efficient shipping cycle.
As also previously communicated, this new streamlined commercial model creates a new and different cadence to the business, where more dramatic periodic swings on the recognized revenues are planned, and the business must be looked at across longer time frames. We now place procurement orders less frequently, but more rapidly convert those orders to revenues on the P&L and cash on the balance sheet.
See below for an annual breakdown of key financial results on the alcohol-free beverage business.
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Consolidated Gross Profit Showed Strong Growth at +20%, Building on the 37% Gain a Year Ago
While the results of the individual business units should be considered separately on a quarterly basis and over time, consolidated gross profit increased +20% for FY 2023, building on the full year FY 2022 growth of +37%. The growth in gross profit for this year shows the dramatic financial impact of the DehydraTECH business on the consolidated financials and gross profit margins, despite a revenue decline on the alcohol-free beverage business driven primarily by the ordering cadence of the new business model.
Cash Flows from Operations Improved Significantly With a 59% Improvement
During the year ended
We Have Completed Our Balance Sheet Transformation, Delivering More Streamlined Financials and Eliminating Items Not Relevant for Our Focused Growth Agenda
Significant advances have been made to improve the overall financial operating health of the Company, reducing both receivables and payables and also eliminating items that are not relevant for our more focused growth agenda. Hill is pleased to provide a snapshot of its streamlined balance sheet below, with corresponding notes. For the Company’s audited financial statements and a comprehensive Company update by way of its Management Discussion and Analysis, please visit the Company’s profile atwww.sedarplus.com.
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Note 1: The Company has reduced its year-over-year trade payables by 66% while maintaining consistent cash reserves.
Note 2:As of
Note 3:As part of the Company’s focused efforts on DehydraTECH expansion in
Shareholder Approval of Hill’s Amended Rolling Stock Option Plan and Amendments to its Restricted Share Unit Plan
Further to the Company’s press release on
In accordance with the TSX’s new policy 4.4 governing security-based compensation plans, certain amendments were made to both the stock option plan and the RSU plan to ensure that the plans met all regulatory requirements. The full text of both plans can be found in the Company's most recent management information circular, a copy of which can be found on the Corporation's SEDAR profile atwww.sedarplus.ca.
About
For more information on our business activities visitwww.hillincorporated.com, to learn more about our DehydraTECH cannabis biodelivery technology, go towww.dehydratech-thc.com, or to check out Hill Street Beverage’s award-winning alcohol-free wine line-up and order product to be delivered straight to your home, go towww.hillstreetbeverages.com.
If you wish to sign up for the
For more information:
matthew@hillincorporated.com
604-609-6154
FORWARD-LOOKING STATEMENTS
Statements in this press release may contain forward-looking information. Any statements in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “would”, “anticipate”, “expects”, and similar expressions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release. 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 required by securities law.
Neither
*FY2022 licensing revenues have been adjusted to reflect bad debts recognized in subsequent periods related to those revenues.
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2 MJBiz Factbook 2023
3 MJBiz Factbook 2023
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