Record revenue of $69.2 million and gross profit improvement to 24% EDMONTON, AB, Aug. 1, 2024 /CNW/ - Nova Cannabis Inc. (the "Company" or "Nova") (TSX:NOVC) today released its unaudited condensed interim consolidated financial statements (the "interim financial statements") and management's discussion and analysis ("MD&A") for the three and six months ended June 30, 2024. All financial information in this press release is reported in millions of Canadian dollars and represents results from continuing operations, unless otherwise indicated. On July 16, 2024, the Corporation announced that, in connection with Marcie Kiziak stepping down from her role as Chief Executive Officer that she would be stepping down from the Board of Directors following the announcement of the Corporation's second quarter 2024 financial results. The Corporation and Ms. Kiziak have agreed that she shall continue to serve on the Nova Board of Directors beyond announcement of second quarter 2024 financial results in order to assist with the Corporation's leadership transition. SECOND QUARTER FINANCIAL AND OPERATING HIGHLIGHTS Revenue increased 8.1% compared to the second quarter of 2023, to record revenue of $69.2 million from $64.0 million. The increase is primarily due to an increase to proprietary licensing sales, an increase in same-store sales primarily in Ontario and new revenue earned related to the acquisition of four (4) Dutch Love stores in British Columbia ("B.C.") and Ontario that were not present in the same prior year period. Revenue related to the B.C. expansion is expected to continue to increase for the remainder of 2024 as rebranding activities and other ramp up factors occurred throughout the second quarter of 2024. Proprietary licensing revenues for the second quarter of 2024 increased by $1.1 million, from $2.7 million to $3.8 million, from the same period in 2023. The increase in proprietary licensing revenue is due to an updated proprietary licensing agreement, scalable for the needs of licensed producers, which allows them to purchase specific sales data to assist them with planning for current and future product decisions. Gross profit for the three months ended June 30, 2024 was $16.8 million, up $2.2 million or 14.8%, from $14.6 million for the same prior year period. For the three months ended June 30, 2024, the Company recorded net earnings of $0.9 million (June 30, 2023 – net earnings of $1.0 million). Nova is pleased to announce it has opened its one hundredth (100) Value Buds store subsequent to June 30, 2024. As of August 1, 2024, Nova owns and/or operates 100 stores in Alberta, Saskatchewan, B.C. and Ontario. On May 8, 2024, Nova issued to SNDL Inc. $6.1 million in Nova shares as consideration for the acquisition of four Dutch Love stores, including three in B.C. The Dutch Love stores were primarily acquired in order for Nova to expand into the recreational cannabis retail market in B.C. For the three months ended June 30, 2024, cash provided by operating activities was $1.5 million, a $1.1 million decrease from the $2.6 million cash provided by operating activities for the same prior year period. The decrease in cash provided by is primarily related to the decrease in non-cash working capital items of $0.7 million. On August 1, 2024, the Company had a cash and cash equivalents balance of $ 5.3 million. SPECIFIED FINANCIAL MEASURES Certain specified financial measures in this earnings release, including Adjusted Earnings from Operations and Free Cash Flow are non-IFRS measures and may not be comparable to similar measures reported by other companies. These non-IFRS financial measures should not be considered in isolation or as an alternative for measures of performance prepared in accordance with IFRS Accounting Standards. Adjusted earnings from operations Adjusted earnings from operations is a non-IFRS financial measure which the Company uses to evaluate its operating performance. Adjusted earnings from operations provides information to investors, analysts, and others to aid in understanding and evaluating the Company's operating results in a similar manner to its management team. The Company defines adjusted earnings from operations as earnings from operations less restructuring costs, goodwill and intangible asset impairments and asset impairments triggered by restructuring activities. The following tables reconcile adjusted earnings from operations to earnings from operations for the periods noted: Three months ended June 30 Six months endedJune 30 (thousands)