Hill Street Beverage Company Inc. (TSXV: BEER) (“Hill Street” or the “Company”) reported its first quarter results for period ended Sept 30, 2020. A complete set of financial statements and Management’s Discussion & Analysis has been filed at www.sedar.com. All dollar figures are quoted in Canadian dollars.

FY21 First Quarter Financial Highlights


  • Net income improvement of $1.050 million, up 69% y/y;
  • Gross revenue of $0.384 million, down 25% y/y, owing to impact of the pandemic on the company’s supply chain;
  • Expense reduction of 55% y/y, due to the company’s focus on containing costs and reducing overhead;
  • Net loss of $.485 million, vs $1.545 million in the prior year.

“The first quarter of FY21 presented both great challenges and great progress for our Company,” said Terry Donnelly, Chairman & CEO of Hill Street. “Hill Street executed very well in the face of the very significant issues we were facing in our supply chain, including an inability to acquire inventory due to pandemic related challenges with various suppliers we rely on, as well as significant delays in licensing the premises and commissioning of the manufacturing equipment of our cannabis copackers. These significant challenges were met head on by our team, who made difficult but prudent decisions to conserve cash, focus on the sales channels and products that deliver the highest margins, and keep making progress toward the launch of new cannabis product portfolio. During the quarter and subsequent to it, we were able to complete very complex, challenging, and transformative deals with both Molecule and Lexaria, and complete a private placement for approximately $850K which will position our Company very well for growth in 2021 and beyond.”

Hill Street‘s alcohol-free brands are now the gold standard in the Canadian Retail landscape, gaining both market share and accolades from our consumers. The challenges in our supply chain were clearly felt during this quarter, but we believe we have turned a corner with our suppliers, and that we are well positioned for the future,” stated June Nicholson, Chief Operating Officer of Hill Street. “Our focus in 2021 will be to significantly grow our online presence in the large US market for alcohol free beverages, and to build our reputation as the taste and experience leader in beverages and other cannabis 2.0 products, based on our patented technology recently acquired from Lexaria Canpharm.”

Hill Street‘s CFO, Hinta Chambers stated, “We have continued to maintain our strong focus on conserving cash, reducing expenses where possible, and investing only in product segments and markets that will deliver the highest returns. Our recently announced acquisition of the assets of Lexaria Canpharm will provide us with significantly differentiated products that we believe will deliver both healthy margins and value for consumers, and help to solidify our company as a leader in the nascent Cannabis 2.0 market both in Canada and internationally.”

RESULTS OF OPERATIONS

The following table summarizes certain financial information of the Company for the three months ended September 30th, 2020 and the three months ended September 30th, 2019.

Results for the Year Ended


Quarter Ended Sept 30, 2020

Quarter Ended Sept 30, 2019
Gross Revenue $ 384,450 $ 513,766
Chargebacks and listing fees $ (109,738) $ (184,327)
Net Revenue $ 274,712 $ 329,439
Direct Costs $ 128,706 $ 152,036
Gross profit $ 146,006 $ 177,403
   
Ordinary Operating Expenses $ 450,720 $ 1,002,158
Other One-time Expenses $ 4,500 $ 545,850
Non-Cash Expenses $ 166,621 $ 154,982
   
Gain (Loss) before other Income $ (475,835) $
(1,525,587)
   
Other income (Expenses)    
Foreign exchange (loss) gain 1,517 $ (2,324)
Write-off of inventory $ (1,535 ) $ 0
Write-off of intangibles $ 0 $ (8,000)
Charges relating to public company listing $ 0 $ 0
Other Income $ 0 $ 0
Income (Loss) and comprehensive Income (loss) for the period $ (475,853) $ (1,545,911)
Basic and diluted income (loss) per common share $ (0.01) $ (0.02)
Weighted average number of common shares outstanding 112,085,463 96,845,070

 
The Company presently has two business segments, the marketing and distribution of Hill Street branded alcohol-free beer and wine via online and retail in Canada and the USA, and the pending launch of cannabis beverages under the Hill Avenue Cannabis brand through licensed copackers. Hill Street sells its products online and through roughly 8,000 points of distribution in grocery and drug stores in Canada.

Acquisition of Assets from Lexaria Canpharm

Subsequent to the quarter, Hill Street signed a definitive agreement with Lexaria Bioscience to acquire the primary assets of Lexaria Canpharm, the sole licensee of the patents associated with the breakthrough DehydraTECH drug delivery process for use in products containing greater than 0.3% THC, commonly known otherwise as Cannabis 2.0 products. Lexaria’s process has over 60 patents either issued or pending. The process provides for rapid onset and offset of the effects of cannabis, as well as provides the potential to create shelf stable products made from cannabis extracts. The Company is currently awaiting approval from The Toronto Stock Exchange to close the transaction. Hill Street has begun development of a facility in Mississauga where cannabis ingredients and consumer products will be manufactured. The Company expects the facility to be operational in 2021, pending Health Canada approval.

Private Placement

Subsequent to the quarter, the Company completed a private placement for gross proceeds of $850,950, which included participation from Kevin Ruddle, a director of the Company, for $350,000, Hinta Chambers, the Chief Financial Officer of the Company for $17,500, and Reuban Nadesan, Director of Strategy and Partnerships of the Company, for $6,000.

Cannabis-infused Adult Beverages

In October 2020, the Company announced the launch of its (V)ia SPRIZA Cannabis Infused Beverages brand, to be manufactured in a partnership with Molecule Inc., a licensed producer of cannabis beverages. The Company anticipates that these beverages will be available through licensed cannabis retailers in Ontario in December 2020, with a planned roll out to major markets nationally in 2021. The Company continues to explore the development of additional Cannabis 2.0 products which would be accretive to its business.

About Hill Street Beverage Company Inc. (TSXV: BEER)

Hill Street Beverage Company is a leading and award-winning company focused on alcohol-free beer, wine, and adult-format beverages. Hill Street‘s brands include Hill Street Craft Brewed Lager, Vin(Zero) and Vintense wines, and have won numerous medals and accolades around the world. Hill Avenue Cannabis, the Company’s wholly-owned subsidiary, will produce and sell cannabis-infused adult beverages and other cannabis products with expected distribution at licensed outlets in 2020. Check out Hill Street‘s award-winning line-up and order product to be delivered straight to your home at www.hillstreetbeverages.com.

For further information:

Terry Donnelly
Chairman and CEO
Hill Street Beverage Company Inc.
terry@hillstreetbevco.com
(416) 543-4904

Follow Hill Street on Twitter: https://twitter.com/hillstreetbevco
and on Facebook: http://facebook.com/hillstreetbevco

Cannot view this image? Visit: https://orders.newsfilecorp.com/files/5205/69270_453362c924bf9bc7_004.jpg
(V)ia SPRIZA sample packaging

To view an enhanced version of this graphic, please visit:
https://orders.newsfilecorp.com/files/5205/69270_453362c924bf9bc7_004full.jpg

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”, “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 TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Not for Dissemination in the United States

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/69270

News Provided by Newsfile via QuoteMedia

Seth Rogen’s New Cannabis Brand are Now Available at Apothecarium Dispensaries in San Francisco , Berkeley and Capitola

The Apothecarium is offering cannabis from Houseplant, the cannabis lifestyle brand founded by Seth Rogen and Evan Goldberg at its five California dispensaries. The Apothecarium has three San Francisco locations (Castro, SOMA and Marina ) and one each in Berkeley and Capitola (outside of Santa Cruz ).

Keep reading... Show less

Love Hemp Group PLC (AQSE:LIFE)(OTCQB:WRHLF), one of the UK’s leading CBD and hemp product suppliers, announces that Charles Lamb will be stepping down as a Non-Executive Independent Director of the Company, with effect from April 16, 2021, to focus on his other business interests

Charles has been an integral part of the Board’s efforts to grow the Company since its inception and has played a key role in the Company’s shift in strategy to focus on growing the Love Hemp brand globally.

Keep reading... Show less

Expects to file its 2020 Annual Financial Statements on or before May 31, 2021

Matica Enterprises Inc. (CSE: MMJ) (FSE: 39N) (OTCQB: MMJFF) (“Matica” or the “Company”) today announced that, as a result of the COVID-19 Pandemic measures, it will not be in a position to file its audited annual financial statements, the related management’s discussion and analysis and related CEO and CFO certificates (the “Annual Filings”) before the required deadline of April 30, 2021 (the “Specified Requirements”).

Keep reading... Show less

Recreational cannabis remains illegal in all Australia’s states and territories with the exception of the Australian Capital Territory (ACT). But could that change in the future?

So far there are no clear indicators as to when or if Australia could legalise recreational cannabis, but attitudes seem to be changing. Public support is growing, and there’s even some political acceptance.

Read on to learn more about when Australia may legalise recreational cannabis.

Keep reading... Show less