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Nutritional High Announces Financial Results for 2019 Third Quarter

TORONTO, July 02, 2019 (GLOBE NEWSWIRE) — Nutritional High International Inc. (“Nutritional High” or the “Company“) (CSE: EAT, OTCQB: SPLIF, FRANKFURT: 2NU) is pleased to announce its financial and business results and wishes to provide highlights and commentary on the results for the third quarter…

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TORONTO, July 02, 2019 (GLOBE NEWSWIRE) — Nutritional High International Inc. (“Nutritional High” or the “Company“) (CSE: EAT, OTCQB: SPLIF, FRANKFURT: 2NU) is pleased to announce its financial and business results and wishes to provide highlights and commentary on the results for the third quarter ended April 30, 2019.

Q3 2019 Q2 2019 Change Q3 2018
Change
Revenue $6,154   $6,063   $91   $1,674 $4,479
COGS $4,523 $4,548 -$25 $1,347 $3,177
Gross Profit $1,630   $1,514   $116   $328 $1,303
Gross Margin % 26.5%   25.0%   1.5%   19.6% 6.9%
Lease and Interest Revenue* $0 $53 -$53 $366 -$366
Operating Expenses $8,074 $7,092 $982 $2,689 $5,385
Other Income (Loss) -$3,050 -$1,026 -$2,024 -$277 -$2,773
Net and Comprehensive Income/(Loss) -$9,741   -$6,805   -$2,936   -$2,397 -$7,344
Earnings/(Loss) per Share -$0.032 -$0.023 -$0.009 -$0.009 -$0.023
All Figures in Thousands CAD, unless otherwise stated
Green Therapeutics (Nevada) and Palo Verde (Colorado) financials are not consolidated in these results
* Historically, revenue was derived from lease and interest income; beginning fiscal Q3 2018, the Company started to earn revenue from Cannabis sales 


Q3 2019 Financial Highlights:

  • Revenue
    – $6.2 million from the sale of Cannabis related products primarily via its wholly owned distributor in California, Calyx Brands Inc. (“Calyx”).
    – Represents an annualized revenue run rate of $24.6 million
    – Five quarters of continuous revenue growth starting Q3 2018, with the latest quarter representing an increase of 368% year over year in Cannabis sales.
    – At the end of January 31, 2019, the Company has now recognized a trailing twelve-month revenue from Cannabis sales of approximately $22.1 million.
    – Management fully expects to strengthen revenue growth from Calyx in the coming months, post activation of its new distribution facility in Chatsworth (more details below). The Company’s new facility enables Calyx to service the Southern California market from a local center, shortening sales cycles, increasing throughput volume and effectively uncapping revenue.
  • Gross Profit of 26.5%, indicating cost of goods sold of $4.5 million including costs of product purchase, direct labor related to products sales and an allocation of overhead directly attributable to product sales. Margin improvement of 1.5% over prior quarter.
  • Total operating expenses of $8.1 million, an increase of $1.0 million over prior quarter and $5.4 million over Q3 2018.
    – In Q3 2019, the Company enhanced its internal controls – procedures designed to provide reasonable assurance that transactions are properly authorized, assets are safeguarded against unauthorized or improper use, and transactions are properly recorded and reported. As part of this, management diligently identified the need to record a loss and reserve on inventory of approximately $2.2 million, composed of $1.7 million in overstatement of inventory and $0.5 million in reserve for slow moving inventory. To ensure that any material recordings such as the above are minimized in the future, management has conducted a detailed review of current systems, workflow processes, and personnel identifying several areas of opportunities for improvements which include but are not limited to: enhancing and updating all SOPs related to inventory management and valuation tracking; reviewing Operations and Finance workflows and implementing advance training as needed; and upgrading key positions and inventory management systems.
    – Excluding the above, year over year increase can also be largely attributed to the ongoing ramp up of Calyx operations and infrastructure to facilitate revenue and margin growth, along with inclusion of operating costs at FLI Labs NorCal and the Company’s La Pine facility in Oregon, increased promotional activities at Calyx, increase in corporate marketing costs and addition of members to senior management and strategic advisors.
  • Other Income loss of ($3.0) million in Q3, a change of ($2.0) million versus the prior quarter.  The Company recorded the following one-time/non-recurring items relating to Pasa Verde LLC (“Pasa Verde”):
    – Impairment: Due to loss of authorization for cannabis manufacturing at Pasa Verde in February 2019, the Company decided to recognize impairment loss (non – cash) of existing intangible assets (license, trade name and customer relationship) and goodwill, of approximately ($6.4) million, also due to a decision of the Company to apply for new local and state licenses.
    – Consideration Payable: as part of the acquisition in July 2018, the Company was obligated to pay up to $6.9 million (“the Earn-out payment”) between 12 and 24 months of the closing date, based on certain performance milestones of Pasa Verde. In connection with the license cancellation in February 2019, Nutritional High has now completed a settlement agreement with the previous owner of Pasa Verde, as a result of which it recognized a gain of approximately $4.9 million due to a reduction in its total consideration payable. The settlement improves the relative financial metrics of the acquisition by significantly reducing future cash obligations, for the Company.

Excluding the above, foreign exchange gain/loss, unrealized changes in fair value of derivative liability relating to the Company’s convertible debentures and all other items, totaled another ($0.5) million.

Business Highlights: Q3 2019 and Subsequent

  • Nutritional High has strengthened its top management position with the appointment of Adam Szweras as CEO in June 2019. Mr. Szweras was a founder of the Company and has been active in its leadership since inception, most recently as Co-Chair of the board.  Mr. Szweras is replacing Jim Frazier, who served as CEO of the Company since July 2016, and has stepped down to pursue other business opportunities. Mr. Szweras is a securities lawyer and an investment banking professional with a successful track record of incubating and scaling cannabis focused companies.  He is also currently a director of several leading cannabis companies including Aurora Cannabis Inc., Harborside Inc. and Quinsam Capital Corp.
  • Calyx has established itself as one of the premier distributors of cannabis products, currently being the number one distributor of edible brands in California. It has delivered five quarters of consecutive revenue growth from Cannabis sales, with a continuous focus on same store sales growth and expanding its service footprint to currently 600 retail stores in the State of California. Simultaneously, it has built a robust data warehouse from its millions of sales transactions that can enable top tier market intelligence and analytics relating to both product categories/segments and geographic demand.
  • Management has executed on its strategy to equip Calyx with the infrastructure needed to effectively service the rapidly growing California retail landscape. In June 2019, the Company signed a non-binding letter of Intent (“LOI”) with Good Vybes, LLC (“GV”) and Hannah Ashby (“Ashby”) to provide a Southern California base of operations for Calyx, located in Chatsworth (“Chatsworth”). The Company has also funded the build out completion of Chatsworth, after which, Calyx and Ashby will service Calyx’s Southern California clients on an exclusive basis. This additional facility enables the Company to expand the scope of its services to areas such as Los Angeles, Long Beach, Palm Springs/Palm Desert, the Inland Empire and San Diego County.
  • In June 2019, the Company received its provisional distribution license from the State of California for NH Distribution California, LLC, located in Sacramento, and will commence distribution operations from this location as well, upon receipt of the Business Operating Permit (“BOP”). The Company’s distribution facilities in Oakland, Sacramento and Chatsworth together make up Nutritional High’s top tier distribution network in California, cementing its capability to service the 1,000 – 2000 dispensaries expected to open in the State. This extensive network provides the architecture towards a step change in on time delivery and pickup, delivery accuracy and minimizing storage demands for retailers.
  • Nutritional High also rapidly moving forward with the build-out of FLI Labs NorCal with the goal of solidifying its manufacturing footprint in California. The Company has engaged in discussions with the City of Sacramento Cannabis Policy & Enforcement (the “City”) and is proceeding to apply for local and State licensing. The Company expects the build-out to be completed before end of 2019, and the BOP is expected to be issued prior to year-end.
  • In May 2019, Nutritional High and Green Therapeutics (“GT”) amended the MIPA (“Amended Agreement”) to exclude certain assets and accompanying intellectual property which were not core to the Company’s manufacturing and distribution focused business model, reducing the purchase price by 50% to USD $9.0 million. Under the Amended Agreement, at closing of the acquisition of a 75% interest in Green Therapeutics, Nutritional High’s Nevada operation will include Green Therapeutics’ currently operating cultivation and manufacturing licenses, a dispensary license, and a distribution license. Excluded from the Amended Agreement are one cultivation and one manufacturing license, non-core brands marketed by GT in Nevada, and the planned purchase of a parcel of land which had been intended for cannabis cultivation. By reducing the purchase price and only acquiring the most accretive assets, the amended agreement allows the Company to remain lean and focused on its core value proposition and drive shareholder value. Closing is pending approval by Nevada State and municipal authorities, expected shortly.  In the interim, the Company and Green Therapeutics are considering completing an escrow closing while awaiting State and local approvals. Green Therapeutics’ financials are not yet included in Nutritional High’s financial reporting.
  • In Colorado, the Company currently leases its Pueblo, property and equipment to Palo Verde LLC (“Palo Verde”), an independent third-party processor licensed by the State of Colorado, and Palo Verde produces the Company’s branded products under a licensing agreement. In May 2019, Colorado Governor Jared Polis signed into law HB19-1090 – “Publicly Licensed Marijuana Companies” which repeals the provision that prohibits publicly traded companies from holding a marijuana license. The Bill was passed by the Colorado Legislature on April 27, 2019, and was sponsored by two Democrats and two Republicans. The new law paves the way for Nutritional High to potentially gain direct ownership interest in MED-licensed entities. Palo Verde also remains laser focused on revenue growth, developing its own distribution network and the development of new product categories for both the recreational and medical markets. Palo Verde’s financials are not included in Nutritional High’s financial reporting.
  • In Washington, the locally licensed entity to whom Nutritional High has sublicensed the rights for Marley Natural, is currently in the planning process of a Marley re-launch in the state focusing on premium concentrate products. In Oregon, the Company is laser focused on a re-defined commercial plan to capitalize on the fast-growing segments of the market, within the edibles, concentrates and pre-rolls categories.
  • In March 2019, the Company entered into a consulting agreement with Thai political operator and businessman, Tom Kruesopon, to develop business opportunities for Nutritional High in Asia. Mr. Kruesopon will assist Nutritional High in developing opportunities in legal jurisdictions across Asia, as well as bringing Asian brands and products to North America. As part of the arrangement, Apple Wealth Holding Company Limited (“AWH”), an affiliate of Mr. Kruesopon, completed a non-brokered private placement (the “Offering”) whereby AWH purchased an aggregate of 5,000,000 common shares for gross proceeds of C$1,350,000.
  • The Company continues to manage its cash position to ensure liquidity and execution of its growth initiatives. Notably, on May 29, 2019 (“Closing Date”), the Company closed a brokered private placement and issued 18,117,000 Units at $0.20 per Unit, for gross proceeds of $3,623,400.  Concurrently, 7,670,000 Units were issued in the non-brokered private placement at $0.20 per Unit, for gross proceeds of $1,534,000.  Each Unit consists of one Common Share and one Common Share purchase warrants (“Warrant”).  Each Warrant entitles the holder to purchase one Common Share, at a price of $0.30 for a period of 36 months (the “Expiry Date”) from Closing Date.

“Own the pipeline, control the shelf space – That is the strategy on which we continue to focus as we continue on our way to becoming a market leader in cannabis extraction, infused product manufacturing, branded products and distribution,” commented Adam Szweras, CEO of Nutritional High. “Our model in California has started to show its impact on our performance and we intend to replicate that strategy in the other states where we operate. The Green Therapeutics deal is expected to close next quarter and together with the new developments in Colorado and Washington, Nutritional High’s business plan is coming to fruition and we’re poised for success well beyond 2019. As part of our corporate strategy, we will aggressively seek out M&A opportunities with the right players in the cannabis distribution and manufacturing space to create further value accretion for our shareholders.”

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NUTRITIONAL HIGH ADVANCES PSYCHEDELICS BUSINESS UNIT: CORPORATE UPDATE

Toronto, Ontario –February 10, 2021 – Nutritional High International Inc. (“Nutritional High” or the “Company”) (CSE: EAT) is pleased to provide an update on its psychedelics business unit. In August 2020 Nutritional High acquired 100% interest in Kruzo LLC through its wholly owned subsidiary Psychedelic…

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Toronto, Ontario –February 10, 2021 – Nutritional High International Inc. (“Nutritional High” or the “Company”) (CSE: EAT) is pleased to provide an update on its psychedelics business unit. In August 2020 Nutritional High acquired 100% interest in Kruzo LLC through its wholly owned subsidiary Psychedelic Science Corp. (“PSC”). Alongside completing a number of corporate initiatives and pursuing acquisitions of OutCo Labs Inc. and Palo Verde LLC, the Company has also been advancing its strategy to capitalize on the opportunities in the psychedelics market.

 

The following is an update of current research and development initiatives including the recent engagement of a contract research organization as well as an update of the go-to-market strategy.

 

Research and Development Update

PSC’s research team has been gathering information (including past studies, as well as anecdotal evidence) regarding the use of cacti for treatment of various ailments, the dosage for consumption and various strains that have been used in the past. The team has identified the following genera of cacti that are going to be of focus in PSC’s ongoing research and development efforts:

Lophophora Genus – includes Lophophora williamsii (also known as Peyote – with principal content of mescaline of 7%) and Lophophora diffusa (contains zero to trace amounts of mescaline; pellotine, whose psychoactive effects are comparatively minimal, is the principal alkaloid).

Echinopsis/Trichocereu pachanol – (also known as San Pedro cactus) has been used in South American traditional medicine dating over two thousand years. The plant is fast growing and can have mescaline content up to 4.7% of dry cactus weight.

Echinopsis/Trichocereus peruvianus – (also known as Peruvian Torch cactus is also a columnar species cactus that contains lower mescaline concentrations potentially 20 times less than E Echinopsis pachanoi.

Echinopsis/Trichocereus lageniormis – (also known as the Bolivian torch cactus) is a fast-growing columnar cactus from the high deserts of Bolivia. The plant contains a number of psychoactive alkaloids, in particular the well-studied chemical mescaline typically at levels lower than Echinopsis pachanoi.

In furtherance of its research and development initiatives, the Company is pleased to announce that PSC has entered into research services agreement with KGK Science Inc. (“KGK”). Pursuant to the agreement, KGK will provide PSC with research and development services in relation to mescaline and various types of cacti that contain psychoactive phenethylamine alkaloids. The services provided under the RSA will focus on three initial stages as follows:

Stage 1: USA and Canada Path-to-Market – assessment of the permissible regulatory route to market and assessment of the safety requirements for that route;

Stage 2: Gap Analysis – undertaking studies required to bridge the gap between what information is publicly available and what is needed to meet regulatory requirements. The studies include identity/chemical analyses, safety/toxicological studies and other specific requirements for Health Canada and United States Food and Drug Administration;

Stage 3: Toxicological Assessment – determining all of the major active ingredients in peyote and other psychedelic cacti, historical use, safety margin assessment, literature review of past pre-clinical and clinical studies, and potential interaction with pharmaceutical products.

Under the agreement, KGK with a focus on Canada and United States, while the Company’s partnership with Rangsit University will focus on PSC’s research and development efforts in Asia (please see the Company’s press releases dated June 24, 2020 and September 29, 2020).

Go-To-Market Strategy

Given the legal status of mescaline, peyote cactus and other psychedelic cacti, market direction will be dictated by the products that are permitted by applicable regulation in the jurisdictions where such products will be sold. PSC intends to determine the permissible path to market based on the research and development efforts of KGK, and the associated capital requirements.

Initially, PSC expects to pursue the nutraceutical market through the development of premium products based on the whole plant extract to compete in the emerging functional food market. These products will be based on the Peyote and San Pedro cacti focused on jurisdictions where regulations permit the manufacture and sale into the natural health product or dietary supplement markets. Establishing products in this area of legal ‘microdosing’ will provide PSC with an accelerated path to market.

In some instances, psychedelic cacti are exempt from regulation pursuant to federal, state and provincial regulations for use in First Nations and Native American jurisdictions. PSC will also investigate manufacturing products for use in First Nations and Native American jurisdictions where permitted by applicable rules and regulations.

As a longer-term strategy, PSC will seek partnership opportunities in the pharmaceutical market to identify and develop compounds with known activity and/or safety profiles from psychedelic cacti. This pharmaceutical path will focus on securing approval of US Food and Drug Administration for the treatment of diseases with high unmet medical needs through filing of Investigational New Drug and/or New Drug Applications. PSC will also take steps to file patent applications on processes and compounds to protect its future market share.

John Durfy, CEO of Nutritional High, commented – “We are very pleased with the advances of our science team in developing the path forward for Psychedelic Science Corp. The addition of KGK Science as a strategic consultant is sure to further advance our efforts and help our research and development take shape. Mescaline is widely known, with a history of use dating back to 3600s BC, but in modern times is one of the less pursued phenethylamines, mainly due to the regulatory complexity.”

 

Mr. Durfy continued: “We are pleased to report PSC’s advances achieved during a busy time for the Company as we completed our debt restructuring and proceed with our critical acquisitions of Outco and Palo Verde. We see the recent development in the psychedelics space as an opportunity to employ our regulatory and product development experience gained in the cannabis space to further create value for shareholders, while maintaining our primary focus on the US cannabis space.”

 

About Nutritional High International Inc.

 

Nutritional High is focused on developing and manufacturing branded products in the cannabis industry, with a specific focus on edibles and oil extracts for medical and adult recreational use. The Company works exclusively in jurisdictions where such activity is permitted and regulated by state law. Nutritional High has brought its flagship FLÏ™ edibles and vape product lines from production to market in various markets including Colorado where its award winning FLÏ™ products are manufactured by Palo Verde, LLC. The Company signed a purchase agreement for Palo Verde and on January 28, 2021, received conditional regulatory approval to close the acquisition.

The Company also owns Psychedelic Science which is working with KGK Science Inc. and Rangsit University in Thailand to conduct research and development of various cacti products targeted at the functional food pharmaceutical markets.

For updates on the Company’s activities and highlights of the Company’s press releases and other media coverage, please follow Nutritional High on Facebook, Twitter and Instagram or visit www.nutritionalhigh.com.

For further information, please contact:

Robert Wilson

Chief Financial Officer

Nutritional High International Inc.

416-666-4005

Email: rwilson@nutritionalhigh.com

Caution Regarding Forward-Looking Information:

NEITHER THE CANADIAN SECURITIES EXCHANGE NOR OTC MARKETS GROUP INC., NOR THEIR REGULATIONS SERVICES PROVIDERS HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

This news release may contain forward-looking statements and information based on current expectations. These statements include statements regarding: the development of products by PSC; the completion of the acquisition of Palo Verde LLC; the completion of the acquisition of OutCo; and the potential for additional synergistic acquisitions. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. This forward-looking information reflects the Company’s current beliefs and is based on information currently available to the Company and on assumptions the Company believes are reasonable. These assumptions include, but are not limited to: the ability of the Company to successfully satisfy the conditions to closing the acquisitions of Palo Verde and OutCo,, the ability of the Company to successfully execute its business plans; legal changes relating to the cannabis industry proceeding as anticipated; and the Company’s continued response and ability to navigate the COVID-19 pandemic being consistent with, or better than, its ability and response to date.

The Company’s securities have not been registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), or applicable state securities laws, and may not be offered or sold to, or for the account or benefit of, persons in the United States or “U.S. Persons”, as such term is defined in Regulation S under the U.S. Securities Act, absent registration or an applicable exemption from such registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in the United States or any jurisdiction in which such offer, solicitation or sale would be unlawful.

Additionally, there are known and unknown risk factors which could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained herein. Such risks and other factors may include, but are not limited to: general business, economic, competitive, political and social uncertainties; general capital market conditions and market prices for securities; the actual results of the Company’s future operations; competition; changes in legislation affecting the Company; obtaining and maintaining regulatory approvals including acquiring and renewing U.S. state, local or other licenses, the uncertainty of existing protection from U.S. federal or other prosecution, regulatory or political change such as changes in applicable laws and regulations, including U.S. state-law legalization, market and general economic conditions of the cannabis sector or otherwise; the timing and availability of external financing on acceptable terms; lack of qualified, skilled labour or loss of key individuals; risks related to the COVID-19 pandemic including various recommendations, orders and measures of governmental authorities to try to limit the pandemic, including travel restrictions, border closures, non-essential business closures, service disruptions, quarantines, self-isolations, shelters-in-place and social distancing, disruptions to markets, economic activity, financing, supply chains and sales channels, and a deterioration of general economic conditions including a possible national or global recession; and a deterioration of financial markets that could limit the Company’s ability to obtain external financing.

A description of additional risk factors that may cause actual results to differ materially from forward-looking information can be found in the Company’s disclosure documents on the SEDAR website at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. Readers are cautioned that the foregoing list of factors is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking information as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. 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 information contained in this press release is expressly qualified by this cautionary statement. The forward-looking information contained in this press release represents the expectations of the Company as of the date of this press release and, accordingly, are subject to change after such date. However, the Company expressly disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities law.

 

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NUTRITIONAL HIGH ANNOUNCES FINANCIAL RESULTS FOR THE FISCAL YEAR ENDING JULY 31, 2020

Toronto, Ontario – February 1, 2021 – Nutritional High International Inc. (“Nutritional High” or the “Company”) (CSE: EAT) is pleased to announce its financial results for the fiscal year ended July 31, 2020. Business Highlights: Q4 and Subsequent Events • As a result of the…

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Toronto, Ontario – February 1, 2021 – Nutritional High International Inc. (“Nutritional High” or the
“Company”) (CSE: EAT) is pleased to announce its financial results for the fiscal year ended July 31,
2020.
Business Highlights: Q4 and Subsequent Events
• As a result of the strategic review undertaken during the year, the Company implemented a number
of initiatives which reduced costs, eliminated unprofitable operations and restructured a number of
its obligations. The effect of such initiatives were realized during the fourth quarter of fiscal 2020
and subsequent to the Company’s July 31, 2020 year end.
• During the three months ended July 31, 2020 the effect of cost reductions were realized as operating
expenses reduced by 65% to $2.3 million.
• The most significant improvements to the balance sheet took place after the fiscal year end
including the following:
1. The elimination of over $8 million in debt through settlement of payables for common shares
and conversion of $7.6 million of convertible debentures;
2. The sale of Calyx Brands Inc. (“Calyx”) which eliminated $11.2 million in liabilities; and
3. Termination of the agreement to acquire Green Therapeutics (“GT”) and entering into an
agreement for the repayment of US$2.2 million in loans due to the Company upon closing of
the sale of GT to Australis Capital Inc. (“Australis”). If the sale of GT is completed, the
repayment of these loans will be in the form of Australis common shares at a valuation of
$0.20 per share. At the current market price for Australis shares, after recent note sales, the
value of the shares to be received upon repayment represents over $4 million.
• With the completion of the reorganization of the business and elimination of approximately $20
million in liabilities, management has focused on the growth of the business with the following
achievements which are expected to drive profitability and value creation for shareholders:
1. On August 14, 2020, the Company acquired all of the outstanding common shares of
Psychedelic Science Corp. (“PSC”) a company developing products and conducting research
in the emerging area of psychoactive therapy and wellness. The acquisition of PSC will allow
Nutritional High to broaden its focus to encompass other plant-based products in addition to
and in combination with cannabis.
2. On May 19, 2020, the Company announced that it has signed an agreement to purchase Palo
Verde LLC and on January 28, 2021 the Colorado Marijuana Enforcement Division (“MED”)
provided conditional approval for completion of this acquisition expected to close in March
2021.
3. On January 29, 2021 the Company announced that it has signed a binding letter agreement to
acquire California-based OutCo Labs Inc. (“OutCo”). OutCo specializes in manufacturing and

retailing premium quality cannabis flower and high margin extract products including award-
winning vape cartridges, tinctures, topicals, capsules and flower products which are sold under

in-house brands through wholly owned retail stores and third-party dispensary clients

throughout California. OutCo is an established operator in the California cannabis landscape
with annual run rate revenues of approximately USD $8.0 million.
Summary Income Statement
Year ended
July 31, 2020

Year ended
July 31, 2019
$ $
Total sales 12,338,061 23,608,410
Cost of goods sold (“COGS”) 9,550,928 18,127,382
Gross Profit 2,787,133 5,481,028
Operating Expenses 15,068,624 25,948,899
Other Items 8,972,883 6,203,200
Pre Tax Income (21,026,075) (26,552,125)
Net comprehensive Income (21,922,661) (27,358,172)
Loss per share (basic) (0.07) (0.09)
Loss per share (diluted) (0.07) (0.09)

Fiscal 2020 Financial Highlights
• Revenue during fiscal 2020 was $12.3 million compared with $23.6 million in 2019 reflecting the
reduction in distribution business at Calyx. As a result of the Company’s strategic review of the
business, Calyx was sold after the fiscal year end.
• Gross Profit during fiscal 2020 was $2.8 million or 22.5% of revenues which was in line with the
previous fiscal year at 23.2% which is reflective of the distribution business of Calyx.
• Operating costs declined by 42% from the prior year to $15 million as a result of reductions in
salaries and consulting fees, lower general and administrative expenses and lower inventory loss
and reserve.
• Expenses and charges included in Other Items were $9 million in 2020 compared with $6.2 million
the prior year. The higher level of Other Items was due to over $10 million in gains on sales or
settlements during fiscal 2019 which were not experienced in 2020. The Company recorded
impairments of intangibles and goodwill of $3.1 million during 2020 which represented a
significant reduction form $11.8 million in impairment charges during fiscal 2019.
• Total Assets as of July 31, 2020 was $6.7 million compared with $19.5 million at the corresponding
date of 2019. This reduction in total assets was due to lower receivables and inventory as a result
of the reduced level of business at Calyx. In addition, impairments of capital assets, intangibles
and goodwill contributed to the reduction of total assets.
• Total Liabilities increased to $28.6 million as at July 31, 2020, from $24.8 million during the same
period in 2019. The increase in liabilities was due to higher levels of payables and accrued
liabilities associated with Calyx as well as the addition of convertible debt incurred during the year.

Corporate Strategy
Nutritional High is focused on identifying, acquiring and developing high-value products and brands for its
cannabis infused edibles and oil extracts product lines sold into the medical and adult recreational markets.
In early 2020 Nutritional High undertook a strategic review of its business with two distinct areas of focus.
As a first step, management undertook a thorough review of assets and investments including distribution
and manufacturing operations with a view to cost reductions and re-deployment of resources on the
segments of the business most likely to achieve profitability in the short term. Secondly, the Company
undertook an overall reassessment of its liabilities including an immediate reduction in costs, sale or closure
of unprofitable operations, settlement of payables, renegotiation of lease agreements as well as repricing,
extending and conversion of debt.
As part of the strategic review process, it was determined that due to the significant amount of working
capital required to sustain the Company’s distribution business, Calyx Brands would be divested. Further,
consistent with the brand focused manufacturing strategy, Nutritional High will be focusing on the
production of branded products, returning the Company to its roots. To this end, the Company announced
that it will complete its acquisition of Palo Verde and it has signed a binding agreement to acquire 100% of
California-based OutCo.
Nutritional High’s redefined presence in it’s three primary states of California, Colorado and Oregon will
act as a foundation for potentially multiple bolt-on synergistic acquisitions in these markets over the
coming months. The Company’s strategy of maintaining financial discipline will be paramount as any
transaction will have to: 1. aide in operational efficiencies in manufacturing facilities through either
increasing under-utilized capacity or increasing capacity where needed 2. Provide additional branded
products where gaps have been identified. To ensure optimized execution, the Company plans to develop
centres of excellence for manufacturing, marketing, innovation and sales. Longer-term, Nutritional High
will selectively pursue acquisitions in states that have positive market and regulatory dynamics.
“It has been a difficult year for the Company as we undertook the reorganization of the business. These
steps, however were necessary to position the Company to be successful in its branded manufacturing
strategy” stated John Durfy, CEO of Nutritional High. “With a cleaner balance sheet, we are now able to
capitalize on our manufacturing strengths and focus on strategic opportunities such as OutCo to profitably
grow our business.”
Update on Management Cease Trade Order
As a result of a strategic review of Nutritional High undertaken over the past year, there was a change of
management and a corporate reorganization which resulted in a delay in the completion of the audit of the
financial statements for the year ended July 31, 2020. The late reporting of the annual statements has also
caused a delay in completion of the first quarter statement for the period ending October 31, 2020.
In anticipation of this delay, the Company applied for and was granted a Management Cease Trade Order
by the Ontario Securities Commission (“MCTO”). With the filing of the financial statements today, the
Company has met the deadline under the MCTO for the filing of its annual financial statement. The MCTO
also provided the Company until February 22, 2021 to file its first quarter statements which it expects to
meet.

About Nutritional High International Inc.
Nutritional High is focused on developing and manufacturing branded products in the cannabis industry,
with a specific focus on edibles and oil extracts for medical and adult recreational use. The Company works
exclusively in jurisdictions where such activity is permitted and regulated by state law. Nutritional High
has brought its flagship FLÏTM edibles and vape product lines from production to market in various markets
including Colorado where its award winning FLÏTM products are manufactured by Palo Verde, LLC. The
Company signed a purchase agreement for Palo Verde and on January 28, 2021, received conditional
regulatory approval to close the acquisition.
The Company also owns Psychedelic Science which is working with Rangsit University in Thailand to
consider the medical benefits of various psychedelic cacti.
For updates on the Company’s activities and highlights of the Company’s press releases and other media
coverage, please follow Nutritional High on Facebook, Twitter and Instagram or visit
www.nutritionalhigh.com.
For further information, please contact:
Robert Wilson
Chief Financial Officer
Nutritional High International Inc.
416-666-4005
Email: rwilson@nutritionalhigh.com
Caution Regarding Forward-Looking Information:
NEITHER THE CANADIAN SECURITIES EXCHANGE NOR OTC MARKETS GROUP INC., NOR THEIR
REGULATIONS SERVICES PROVIDERS HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS RELEASE.
This news release may contain forward-looking statements and information based on current expectations. These
statements include statements regarding: the acquisition of PSC enabling the Company to broaden its focus; the
completion of the acquisition of Palo Verde LLC; the completion of the acquisition of OutCo; and the potential for
additional synergistic acquisitions. These statements should not be read as guarantees of future performance or
results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual

results, performance or achievements to be materially different from those implied by such statements. This forward-
looking information reflects the Company’s current beliefs and is based on information currently available to the

Company and on assumptions the Company believes are reasonable. These assumptions include, but are not limited
to: the ability of the Company to successfully satisfy the conditions to closing the acquisitions of Palo Verde and
OutCo,, the ability of the Company to successfully execute its business plans; legal changes relating to the cannabis
industry proceeding as anticipated; and the Company’s continued response and ability to navigate the COVID-19
pandemic being consistent with, or better than, its ability and response to date.
The Company’s securities have not been registered under the U.S. Securities Act of 1933, as amended (the “U.S.
Securities Act”), or applicable state securities laws, and may not be offered or sold to, or for the account or benefit
of, persons in the United States or “U.S. Persons”, as such term is defined in Regulation S under the U.S. Securities
Act, absent registration or an applicable exemption from such registration requirements. This press release shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in the United
States or any jurisdiction in which such offer, solicitation or sale would be unlawful.
Additionally, there are known and unknown risk factors which could cause the Company’s actual results, performance
or achievements to be materially different from any future results, performance or achievements expressed or implied

by the forward-looking information contained herein. Such risks and other factors may include, but are not limited
to: general business, economic, competitive, political and social uncertainties; general capital market conditions and
market prices for securities; the actual results of the Company’s future operations; competition; changes in legislation
affecting the Company; obtaining and maintaining regulatory approvals including acquiring and renewing U.S. state,
local or other licenses, the uncertainty of existing protection from U.S. federal or other prosecution, regulatory or
political change such as changes in applicable laws and regulations, including U.S. state-law legalization, market
and general economic conditions of the cannabis sector or otherwise; the timing and availability of external financing
on acceptable terms; lack of qualified, skilled labour or loss of key individuals; risks related to the COVID-19
pandemic including various recommendations, orders and measures of governmental authorities to try to limit the
pandemic, including travel restrictions, border closures, non-essential business closures, service disruptions,
quarantines, self-isolations, shelters-in-place and social distancing, disruptions to markets, economic activity,
financing, supply chains and sales channels, and a deterioration of general economic conditions including a possible
national or global recession; and a deterioration of financial markets that could limit the Company’s ability to obtain
external financing.
A description of additional risk factors that may cause actual results to differ materially from forward-looking
information can be found in the Company’s disclosure documents on the SEDAR website at www.sedar.com. Although
the Company has attempted to identify important factors that could cause actual results to differ materially from those
contained in forward-looking information, there may be other factors that cause results not to be as anticipated,
estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. Readers
are cautioned that the foregoing list of factors is not exhaustive. Readers are further cautioned not to place undue
reliance on forward-looking information as there can be no assurance that the plans, intentions or expectations upon
which they are placed will occur. 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 information contained in this press release is expressly qualified by this cautionary statement. The
forward-looking information contained in this press release represents the expectations of the Company as of the date
of this press release and, accordingly, are subject to change after such date. However, the Company expressly
disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new
information, future events or otherwise, except as expressly required by applicable securities law.

The post NUTRITIONAL HIGH ANNOUNCES FINANCIAL RESULTS FOR THE FISCAL YEAR ENDING JULY 31, 2020 appeared first on Nutritional High International Inc..

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NUTRITIONAL HIGH PROVIDES AN UPDATE TO THE MANAGEMENT CEASE TRADE ORDER

Toronto, Ontario – January 28, 2020 – Nutritional High International Inc. (“Nutritional High” or the “Company”) (CSE: EAT, OTCQB: SPLIF) provides this bi-weekly default status report in accordance with National Policy 12-203 – Cease Trade Orders for Continuous Disclosure Defaults (“NP 12-203”). In the Corporation’s…

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Toronto, Ontario – January 28, 2020 – Nutritional High International Inc. (“Nutritional High” or
the “Company”) (CSE: EAT, OTCQB: SPLIF) provides this bi-weekly default status report in
accordance with National Policy 12-203 – Cease Trade Orders for Continuous Disclosure Defaults
(“NP 12-203”). In the Corporation’s initial default announcement of October 30, 2020 (the
“Default Notice”), the Corporation announced the delay in the filing of its audited annual financial
statements for the year ended July 31, 2020 (the “2020 Annual Financial Statements”) and
related management discussion and analysis and certifications (collectively, the “Annual Filings”)
by the prescribed filing deadline.
As previously announced in the Company’s December 1, 2020 press release of the Corporation,
the Corporation applied for and was granted a management cease trade order in respect of the
delayed Annual Filings (the “MCTO”) by the Ontario Securities Commission. The MCTO
prohibits the chief financial officer and the chief executive officer from trading in the Corporation’s
securities for so long as there are filings that are outstanding under applicable securities laws. The
MCTO does not affect the ability of the general investing public to trade in the Corporation’s listed
common shares.
The audit of the 2020 Annual Financial Statements is in progress and the Corporation continues to
expect to file the Annual Filings on February 1, 2021.
The Corporation confirms that since the Default Notice: (i) there is no material change to the
information set out in the Default Notice that has not been generally disclosed; (ii) there has been
no failure by the Corporation in fulfilling its stated intentions with respect to satisfying the
provisions of the alternative information guidelines set out in NP 12-203; (iii) there has not been
any other specified default by the Corporation under NP 12-203; and (iv) there is no other material
information concerning the affairs of the Corporation that has not been generally disclosed.
Furthermore, the Corporation anticipates that its interim financial statements for the three-month
period ended October 31, 2020, the accompanying management’s discussion and analysis and the
related CEO and CFO certifications will not be filed by the prescribed filing deadline and will be
filed on or before February 22, 2021.
The Corporation will continue to comply with the provisions of the alternative information
guidelines under NP 12-203 by issuing bi-weekly default status reports in the form of news releases
for so long as it remains in default of the filing requirements set out above.

.

About Nutritional High International Inc.
Nutritional High is focused on developing and manufacturing branded products in the cannabis
industry, with a specific focus on edibles and oil extracts for medical and adult recreational use.
The Company works exclusively in jurisdictions where such activity is permitted and regulated by
state law. Nutritional High has brought its flagship FLÏTM edibles and vape product lines from
production to market in various markets including Colorado where its award winning FLÏTM
products are manufactured by Palo Verde, LLC. The Company signed a purchase agreement for
Palo Verde and is awaiting regulatory approval.
The Company also owns Psychedelic Science which is working with Rangsit University in
Thailand to consider the medical benefits of various psychedelic cacti.

For updates on the Company’s activities and highlights of the Company’s press releases and other
media coverage, please follow Nutritional High on Facebook, Twitter and Instagram or visit
www.nutritionalhigh.com.
For further information, please contact:
Robert Wilson
Chief Financial Officer
Nutritional High International Inc.
416-666-4005
Email: rwilson@nutritionalhigh.com
Caution Regarding Forward-Looking Information:
NEITHER THE CANADIAN SECURITIES EXCHANGE NOR OTC MARKETS GROUP INC.,
NOR THEIR REGULATIONS SERVICES PROVIDERS HAVE REVIEWED OR ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This news release may contain forward-looking statements and information based on current
expectations. These statements should not be read as guarantees of future performance or results.
Such statements involve known and unknown risks, uncertainties and other factors that may cause
actual results, performance or achievements to be materially different from those implied by such
statements. Risks that may have an impact on the ability for these events to be achieved include
completion of the 2020 Filings. Although such statements are based on management’s reasonable
assumptions, there can be no assurance that such assumptions will prove to be correct. We assume
no responsibility to update or revise them to reflect new events or circumstances.
The Company’s securities have not been registered under the U.S. Securities Act of 1933, as
amended (the “U.S. Securities Act”), or applicable state securities laws, and may not be offered
or sold to, or for the account or benefit of, persons in the United States or “U.S. Persons”, as such

term is defined in Regulation S under the U.S. Securities Act, absent registration or an applicable
exemption from such registration requirements. This press release shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of the securities in the United
States or any jurisdiction in which such offer, solicitation or sale would be unlawful.
Additionally, there are known and unknown risk factors which could cause the Company’s actual
results, performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by the forward-looking information contained
herein. All forward-looking information herein is qualified in its entirety by this cautionary
statement, and the Company disclaims any obligation to revise or update any such forward-looking
information or to publicly announce the result of any revisions to any of the forward-looking
information contained herein to reflect future results, events or developments, except as required
by law. Some of the risks and other factors that could cause actual results to differ materially from
those expressed in forward-looking information expressed in this press release include, but are not
limited to: obtaining and maintaining regulatory approvals including acquiring and renewing U.S.
state, local or other licenses, the uncertainty of existing protection from U.S. federal or other
prosecution, regulatory or political change such as changes in applicable laws and regulations,
including U.S. state-law legalization, market and general economic conditions of the cannabis
sector or otherwise.

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