Indiva : Condensed Consolidated Interim Financial Statements for the three and six months ended June 30, 2022

INDIVA LIMITED

Condensed Consolidated Interim Financial Statements

(Unaudited, Expressed in Canadian dollars)

For the three and six months ended June 30, 2022 and 2021

Indiva Limited

Condensed Consolidated Interim Statements of Financial Position (Unaudited, Expressed in Canadian dollars, except per share amounts)

As at	Note	June 30, 2022	December 31, 2021
			(Note 5)
		$	$
ASSETS
Current assets
Cash		2,513,017	2,480,335
Accounts receivable	6	3,953,847	5,870,468
Inventory	7	4,902,340	6,442,301
Prepaid expenses and deposits	8	481,271	650,011
Prepaid royalties	13	13,836	71,246
Assets held for sale	11	131,460	-
Total current assets		11,995,771	15,514,361
Other non-current assets
Property, plant and equipment	9	21,616,154	22,396,477
Assets in process	10	132,134	59,863
Equipment deposits	9	1,065,091	726,711
Intangible assets	12	1,762,417	1,866,147
Prepaid royalties	13	1,928,605	1,877,704
Total assets		38,500,172	42,441,263
LIABILITIES AND EQUITY
Current liabilities
Accounts payable and accrued liabilities		8,845,224	7,878,322
Deferred revenue		-	4,025
Other liabilities	15	168,109	156,780
Lease liability	16	149,320	150,457
Convertible debentures	17	2,767,431	701,158
Total current liabilities		11,930,084	8,890,742
Other non-current liabilities
Other liabilities	15	716,689	731,393
Lease liability	16	491,805	564,068
Loan payable	14	18,627,219	18,327,529
Convertible debentures	17	-	1,898,412
Total liabilities		31,765,797	30,412,144
Equity
Share capital	18	57,229,825	57,229,825
Contributed surplus		5,846,383	5,737,124
Reserves		5,801,116	5,629,233
Accumulated other comprehensive loss		(19,537)	(19,537)
Accumulated deficit		(62,123,412)	(56,547,526)
Total equity		6,734,375	12,029,119
Total liabilities and equity		38,500,172	42,441,263

Going Concern (Note 3), Commitments (Note 26), and Subsequent Events (Note 29)

N. Marotta	J. Yersh
Carmine (Niel) Marotta	James Yersh

Indiva Limited

Consolidated Statements of Loss and Comprehensive Loss For the three and six months ended June 30, 2022 and 2021

(Unaudited, Expressed in Canadian dollars, except per share amounts)

Note

Gross revenue
Excise taxes
Net revenue
Cost of goods sold	7
Write-down of inventory	7
Gross margin before fair value adjustments
Fair value adjustment on sale of
inventory
Unrealized loss on changes in fair value of
biological assets
Gross margin
Operating expenses
General and administrative
Marketing and sales
Research and development
Share-based compensation	18(c)
Expected credit loss (recovery)	23(c)
Depreciation of property, plant and	9
equipment
Amortization of intangible assets	12
Total operating expenses
Loss from operations
Other income (expenses)
Foreign exchange gain (loss)
Finance costs	21
Interest income
Loss on issuance of shares
Provision for onerous contract
Impairment and loss on disposal of	11
property, plant and equipment
Loss before income taxes
Deferred tax recovery
Net loss and comprehensive loss
attributable to shareholders
Loss per share, basic and diluted	19
Weighted average number of outstanding	19
shares, basic and diluted

Three months ended June 30	Six months ended June 30
2022	2021	2022	2021
	(Note 5)		(Note 5)
$	$	$	$
8,891,274	9,870,342	18,590,061	16,740,560
(764,745)	(875,481)	(1,584,962)	(1,577,703)
8,126,529	8,994,861	17,005,099	15,162,857
(5,435,769)	(5,978,479)	(11,685,921)	(11,006,230)
(523,700)	(289,035)	(1,372,954)	(1,096,425)
2,167,060	2,727,347	3,946,224	3,060,202
-	(14,555)	-	(57,761)
-	(2,814)	-	(143,359)
2,167,060	2,709,978	3,946,224	2,859,082
1,359,663	1,675,036	2,807,848	2,800,532
1,625,421	1,091,019	3,356,101	1,960,954
225,129	40,965	335,826	40,965
176,660	162,094	288,047	273,257
(2,295)	5,918	(536)	18,357
51,793	71,443	98,879	127,644
51,865	51,983	103,729	103,965
3,488,236	3,098,458	6,989,894	5,325,674
(1,321,176)	(388,480)	(3,043,670)	(2,466,592)
(20,706)	4,861	(34,593)	81,866
(1,161,766)	(653,367)	(2,298,807)	(1,299,990)
5,550	1,357	6,859	1,832
-	-	-	(20,130)
-	(700,959)	-	(1,102,756)
(3,735)	(10,340)	(205,675)	(10,340)
(2,501,833)	(1,746,928)	(5,575,886)	(4,816,110)
-	266,954	-	266,954
(2,501,833)	(1,479,974)	(5,575,886)	(4,549,156)
(0.02)	(0.01)	(0.04)	(0.03)
146,150,202	135,995,619	146,150,202	128,219,249

Indiva Limited

Consolidated Statements of Changes in Equity

For the six months ended June 30, 2022 and 2021

(Unaudited, Expressed in Canadian dollars, except per share amounts)

			Share capital
								Accumulated
								other
					Contributed		Accumulated	comprehensive
		Note	Shares	Amount	surplus	Reserves	deficit	loss	Total
			#	$	$	$	$	$	$
	Balance, January 1, 2022	5	146,150,202	57,229,825	5,737,124	5,629,233	(56,547,526)	(19,537)	12,029,119
	Share-based compensation	18(c)	-	-	109,259	171,883	-	-	281,142
	Net loss for the period		-	-	-	-	(5,575,886)	-	(5,575,886)
	Balance, June 30, 2022		146,150,202	57,229,825	5,846,383	5,801,116	(62,123,412)	(19,537)	6,734,375
			Share capital				Accumulated
								other
					Contributed		Accumulated	comprehensive
		Note	Shares	Amount	surplus	Reserves	deficit	loss	Total
			#	$	$	$	$	$	$
	Balance, January 1, 2021	5	109,555,952	42,415,786	4,723,080	5,337,081	(41,330,865)	(19,537)	11,125,545
	Share based compensation		-	-	97,222	217,648	-	-	314,870
	Issuance of shares		25,000,000	12,115,390	-	-	-	-	12,115,390
	Share issuance costs		-	(594,972)	-	-	-	-	(594,972)
	Shares issued in lieu of
	interest		183,000	65,880	-	-	-	-	65,880
	Warrants exercised		95,000	51,095	-	(13,095)	-	-	38,000
	Broker warrants exercised		486,667	229,220	-	(83,220)	-	-	146,000
	Expired Warrants		-	-	99,509	(99,509)	-	-	-
	Conversion of convertible
	debentures		675,000	147,348	-	(41,621)	-	-	105,727
	Net loss for the period		-	-	-	-	(4,549,156)	-	(4,549,156)
	Balance, June 30, 2021		135,995,619	54,429,747	4,919,811	5,317,284	(45,880,021)	(19,537)	18,767,284

Indiva Limited

Condensed Consolidated Interim Statements of Cash Flows For the six months ended June 30, 2022 and 2021 (Unaudited, Expressed in Canadian dollars, except per share amounts)

	Note	2022	2021
			(Note 5)
		$	$
OPERATING ACTIVITES
Net loss for the period		(5,575,886)	(4,549,156)
Adjustments for:
Deferred tax recovery		-	(266,954)
Unrealized gain on changes in fair value of biological assets		-	143,359
Realized fair value adjustments on inventory sold		-	57,761
Write-off of inventory to net realizable value	7	1,372,954	1,096,425
Depreciation and amortization	9, 12	202,608	231,609
Impairment and loss on disposal of property, plant and equipment	11	205,675	10,340
Interest, accretion of discounts and deferred transaction costs		577,717	809,215
Share-based compensation	18	281,142	314,870
Shares issued to settle account payable and interest on convertible
debenture		-	65,880
Provision for onerous contract			1,102,756
Interest income		(6,859)	(1,832)
Changes in working capital items	20	3,686,497	(5,758,678)
Cash provided by (used in) operating activities		743,848	(6,744,405)
INVESTING ACTIVITIES
Purchase of property, plant and equipment	9	(79,108)	(291,538)
Purchase of assets in process	10	(193,819)	(560,842)
Building, equipment and construction deposits	9	(338,380)	-
Proceeds on disposal of assets held for sale	11	885	-
Interest income		6,859	1,832
Cash used in investing activities		(603,563)	(850,548)
FINANCING ACTIVITIES
Proceeds from issuance of equity units, net of costs		-	11,787,372
Proceeds from exercise of warrants		-	184,000
Payment of principal portion of lease liabilities	16	(107,603)	(104,405)
Proceeds from loan payable, net of transaction costs		-	8,881,183
Repayment of loan payable		-	(4,892,864)
Repayment of promissory note		-	(1,614,438)
Advances on factoring payable		-	3,659,415
Repayments on factoring payable		-	(7,234,881)
Cash provided by (used in) financing activities		(107,603)	10,665,382
Change in cash		32,682	3,070,429
Cash, beginning of the period		2,480,335	314,042
Cash, end of the period		2,513,017	3,384,471