Revenue Rises 110.0% to $43.1 (C$56.4) Million in 2018
Strategic
Partnerships and Acquisitions Position Tilray to Accelerate Global Sales
Growth and Drive Long-Term Shareholder Value
Tilray, Inc., (“Tilray” or the “Company”) (Nasdaq: TLRY) a global leader in cannabis research, cultivation, production and distribution, today reported financial results for the fourth quarter and year ended December 31, 2018. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated.
“2018 was a very successful year for Tilray with many corporate milestones. Our team made significant progress on our long-term initiatives including increasing production capacity, expanding and strengthening strategic partnerships, and acquiring complementary businesses to accelerate our future growth and leadership position in medical and adult-use cannabis,” commented Brendan Kennedy, President and Chief Executive Officer of Tilray. “Looking ahead, we remain committed to pursuing global growth opportunities and will be disciplined in deploying capital, particularly in the United States and Europe, where we believe we have multiple paths for value creation.”
2018 Financial Highlights
Fourth Quarter 2018 Financial Highlights
Business Highlights
Conference Call
The Company will host a conference call to discuss these results today at 5:00 p.m. ET. Investors interested in participating in the live call can dial 877-489-6528 from the United States and 629-228-0736 internationally. A telephone replay will be available approximately two hours after the call concludes through Monday, April 1, 2019, by dialing 855-859-2056 from the United States, or 404-537-3406 from international locations and entering confirmation code 6093459.
There will also be a simultaneous, live webcast available on the Investors section of the Company’s website at www.tilray.com. The webcast will be archived for 30 days.
About Tilray®
Tilray is a global pioneer in the research, cultivation, production and distribution of cannabis and cannabinoids currently serving tens of thousands of patients and consumers in twelve countries spanning five continents.
Forward Looking Statements
This press release contains “forward-looking statements”, which may be identified by the use of words such as, “may”, “would”, “could”, “will”, “likely”, “expect”, “anticipate”, “believe, “intend”, “plan”, “forecast”, “project”, “estimate”, “outlook” and other similar expressions. including statements regarding our growth potential, the sustainability of growth, demand for our products and the medical and adult-use cannabis markets and anticipated plans for strategic partnerships. Forward-looking statements are not a guarantee of future performance and are based upon a number of estimates and assumptions of management in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, including assumptions in respect of current and future market conditions. Actual results, performance or achievement could differ materially from that expressed in, or implied by, any forward-looking statements in this press release, and, accordingly, you should not place undue reliance on any such forward-looking statements and they are not guarantees of future results. Forward-looking statements involve significant risks, assumptions, uncertainties and other factors that may cause actual future results or anticipated events to differ materially from those expressed or implied in any forward-looking statements. Please see the heading “Risk Factors” in Tilray’s Quarterly Report on Form 10-Q, which was filed with the Securities and Exchange Commission on November 14, 2018, for a discussion of the material risk factors that could cause actual results to differ materially from the forward-looking information. Tilray does not undertake to update any forward-looking statements that are included herein, except in accordance with applicable securities laws.
Use of Non-U.S. GAAP Financial Measures
To supplement its financial statements, the Company provides investors with information related to Adjusted EBITDA, which is not a financial measure calculated in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). Adjusted EBITDA is calculated as net income (loss) before interest expense, net; other (income), net; deferred income tax recovery, tax expense; foreign exchange (gain) loss; depreciation and amortization; and stock-based compensation expense. A reconciliation of Adjusted EBITDA to net loss, the most directly comparable GAAP measure, has been provided in the financial statement tables included below in this press release. The Company believes Adjusted EBITDA provides useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. Management uses Adjusted EBITDA to compare the Company's performance to that of prior periods for trend analyses and planning purposes. Adjusted EBITDA is also presented to the Company’s Board of Directors.
Non-U.S. GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP. Non-U.S. GAAP measures exclude significant expenses that are required by U.S. GAAP to be recorded in the Company's financial statements and are subject to inherent limitations.
____________________________
1 Announced January 14, 2019
2 Announced
February 20, 2019
3 Announced February 19, 2019
4
Announcements made on January 31, 2019, February 7, 2019 and March 18,
2019
5 Announced March 6, 2019
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TILRAY, INC. |
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| Consolidated Statements of Net Loss and Comprehensive Loss | ||||||||||||||||
| (in thousands of U.S. dollars, except for per share data) | ||||||||||||||||
| Three months ended | Twelve months ended | |||||||||||||||
|
|
December 31, | December 31, | ||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Revenue | $ | 15,531 | $ | 5,113 | $ | 43,130 | $ | 20,538 | ||||||||
| Cost of sales | 12,397 | 2,179 | 28,855 | 9,161 | ||||||||||||
| Gross margin | 3,134 | 2,934 | 14,275 | 11,377 | ||||||||||||
| Research and development expenses | 1,848 | 739 | 4,264 | 3,171 | ||||||||||||
| Sales and marketing expenses | 6,305 | 3,252 | 15,366 | 7,164 | ||||||||||||
| General and administrative expenses | 13,778 | 1,521 | 31,307 | 8,401 | ||||||||||||
| Stock-based compensation expense | 4,111 | 34 | 20,988 | 139 | ||||||||||||
| Operating loss | (22,908 | ) | (2,612 | ) | (57,650 | ) | (7,498 | ) | ||||||||
| Foreign exchange loss (gain), net | 6,321 | 55 | 7,234 | (1,363 | ) | |||||||||||
| Interest expense, net | 7,717 | 258 | 9,110 | 1,686 | ||||||||||||
| Other (income) expense, net | (1,398 | ) | 3 | (1,820 | ) | (12 | ) | |||||||||
| Loss before income taxes | (35,548 | ) | (2,928 | ) | (72,174 | ) | (7,809 | ) | ||||||||
| Deferred income tax recovery | (4,485 | ) | — | (4,485 | ) | — | ||||||||||
| Current income tax (recovery) expense | (53 | ) | — | 34 | — | |||||||||||
| Net loss | $ | (31,010 | ) | $ | (2,928 | ) | $ | (67,723 | ) | $ | (7,809 | ) | ||||
| Net loss per share - basic and diluted | (0.33 | ) | (0.04 | ) | (0.82 | ) | (0.10 | ) | ||||||||
| Weighted average shares used in computation of net loss per share - basic and diluted | 93,169,688 | 75,000,000 | 83,009,656 | 75,000,000 | ||||||||||||
| Net loss | $ | (31,010 | ) | $ | (2,928 | ) | $ | (67,723 | ) | $ | (7,809 | ) | ||||
| Foreign currency translation gain | 127 | 523 | 662 | 282 | ||||||||||||
| Loss on investments classified as available-for-sale | (765 | ) | — | (765 | ) | — | ||||||||||
| Comprehensive loss | $ | (31,648 | ) | $ | (2,405 | ) | $ | (67,826 | ) | $ | (7,527 | ) | ||||
| TILRAY, INC. | ||||||||
| Consolidated Balance Sheets | ||||||||
| (in thousands of U.S. dollars, except for per share data) | ||||||||
| December 31, | December 31, | |||||||
| 2018 | 2017 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 487,255 | $ | 2,323 | ||||
| Short-term investments | 30,335 | — | ||||||
| Accounts receivable, net of allowance of $292 and $8 as of December 31, 2018 and 2017, respectively | 16,525 | 983 | ||||||
| Other receivables | 969 | 1,131 | ||||||
| Inventory | 16,211 | 7,421 | ||||||
| Prepaid expenses and other current assets | 3,007 | 545 | ||||||
| Total current assets | 554,302 | 12,403 | ||||||
| Property and equipment, net | 80,214 | 39,985 | ||||||
| Intangible assets, net | 4,486 | 934 | ||||||
| Investments | 16,911 | — | ||||||
| Deposits and other assets | 754 | 626 | ||||||
| Total assets | $ | 656,667 | $ | 53,948 | ||||
| Liabilities | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 10,649 | $ | 5,563 | ||||
| Accrued expenses and other current liabilities | 14,818 | 2,021 | ||||||
| Accrued obligations under capital lease | 470 | 379 | ||||||
| Current portion of long-term debt | — | 9,432 | ||||||
| Privateer Holdings debt facilities | — | 32,826 | ||||||
| Total current liabilities | 25,937 | 50,221 | ||||||
| Accrued obligations under capital lease | 8,286 | 8,579 | ||||||
| Deferred tax liability | 4,424 | — | ||||||
| Convertible senior notes due 2023, net of issuance costs | 420,367 | — | ||||||
| Total liabilities | $ | 459,014 | $ | 58,800 | ||||
| Stockholders’ equity (deficit) | ||||||||
| Class 1 common stock ($0.0001 par value, 250,000,000 shares authorized and 16,666,667 shares issued and outstanding at December 31, 2018; none authorized, issued or outstanding at December 31, 2017) | 2 | — | ||||||
| Class 2 common stock ($0.001 par value; 500,000,000 shares authorized and 76,504,200 shares issued and outstanding at December 31, 2018; none authorized, issued or outstanding at December 31, 2017) | 8 | — | ||||||
|
Capital stock (none authorized, issued or outstanding at December
31, 2018;
1 share authorized, issued and outstanding at December 31, 2017) |
— | — | ||||||
| Additional paid-in capital | 302,057 | 31,736 | ||||||
| Accumulated other comprehensive income | 3,763 | 3,866 | ||||||
| Accumulated deficit | (108,177 | ) | (40,454 | ) | ||||
| Total stockholders’ equity (deficit) | 197,653 | (4,852 | ) | |||||
| Total liabilities and stockholders’ equity (deficit) | $ | 656,667 | $ | 53,948 | ||||
| Three Months Ended | Twelve Months Ended | ||||||||||||
| December 31, | December 31, | ||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||
| Adjusted EBITDA reconciliation: | |||||||||||||
| Net loss | $ | (31,010 | ) | $ | (2,928 | ) | $ | (67,723 | ) | $ | (7,809 | ) | |
| Stock-based compensation expense | 4,111 | 34 | 20,988 | 139 | |||||||||
| Foreign exchange loss (gain), net | 6,321 | 55 | 7,234 | (1,363 | ) | ||||||||
| Interest expense, net | 7,717 | 258 | 9,110 | 1,686 | |||||||||
| Other (income) expense, net | (1,398 | ) | 3 | (1,820 | ) | (12 | ) | ||||||
| Deferred income tax recovery | (4,485 | ) | — | (4,485 | ) | — | |||||||
| Current income tax (recovery) expense | (53 | ) | — | 34 | — | ||||||||
| Depreciation and amortization | 1,009 | 452 | 3,562 | 1,853 | |||||||||
| Adjusted EBITDA | $ | (17,788 | ) | $ | (2,126 | ) | $ | (33,100 | ) | $ | (5,506 | ) | |
View source version on businesswire.com: https://www.businesswire.com/news/home/20190318005756/en/
Media: Chrissy Roebuck, +1-833-206-8161, news@tilray.com
Investors:
Katie Turner, +1-646-277-1228, katie.turner@icrinc.com