Empower Clinics Reports 2Q 2019 Results Highlighted by an 89% increase in clinic revenues and a 37% decrease in operating expenses compared to 2Q 2018
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES./
VANCOUVER, Aug. 14, 2019 /CNW/ - EMPOWER CLINICS INC. (CSE: CBDT) (Frankfurt 8EC) (OTC: EPWCF) ("Empower" or the "Company"), a vertically integrated and growth-oriented CBD life sciences company, and a multi-state operator of medical health & wellness clinics in the U.S., has filed today its unaudited interim condensed consolidated financial statements for the three and six months ended June 30th, 2019 and related management's discussion and analysis, both of which are available at www.SEDAR.com. All financial information in this press release is reported in United States dollars, unless otherwise indicated.
"The impact of cost cutting measures and the benefit of the Sun Valley acquisition are now showing up in the financial statements of the Company" said Steven McAuley, Empower's Chairman & CEO. "Even though we can only book two months of Sun Valley's performance in 2Q, the significance is notable, and we expect continued benefits going forward, especially with the new retail product strategy in-clinics and with the franchise program."
Q2 2019 Highlights
2019 Outlook and Catalysts
$, except where noted
Three months ended
Six months ended
Direct Clinic Expenses
Loss from operations
Net loss per share
Clinic revenues for Q2 2019 were $591,024, compared to Q2 2018 revenues of $312,485. This increase over the prior year is attributable to the acquisition of Sun Valley Clinics effective May 1, 2019, and includes two months of accretive revenue. Future results will include a full three months of results of Sun Valley in quarters going forward.
Direct clinic expenses for Q2 2019 were $82,750, compared to Q2 2018 direct clinic expenses of $107,271. These expenses declined despite the increase in revenues due to improved operational controls to align labor cost with direct patient consultations. The Company employs a diverse mix of physicians and practitioners.
Net loss from operations for Q2 2019 was $1,424,070, compared to Q2 2018 net loss of $2,703,891. This decrease in loss below prior year is primarily attributable to two factors. Operating expense decreased due to a decrease in salaries and benefits as a result of aggressive headcount cuts and facility changes. Additionally, share-based payments decreased due to timing of share-based awards to management.
Net loss for Q2 2019 was $1,456,505, respectively, compared to Q2 2018 net loss of $3,915,443. This decrease over prior year is primarily attributable to the decrease in operating expenses and share-based compensation expense. In addition, Q2 2018 included listing fees associated with the RTO.
During Q2 2019, the Company used $1,331,950 in cash from operations after changes in non-cash working capital. The Company invested $543,573 for the acquisition of Sun Valley Clinics and raised $2,576,907 via proceeds from various issuances of shares, convertible debentures and notes.
Please refer to the Company's unaudited condensed interim consolidated financial statements, related notes and accompanying management discussion and analysis for a full review of the operations.
Empower is a vertically integrated and growth-oriented CBD life sciences company, and a multi-state operator of medical health & wellness clinics, operating the Sun Valley Health clinic brand www.sunvalleyhealth.com, for its nine corporate locations and for franchises in the United States. As a CBD product manufacturer under the Sollievo brand, the Company distributes its lines through clinics, online and through retail partners. Extraction operations are currently being developed in the Company's new extraction facility in Oregon.
ON BEHALF OF THE BOARD OF DIRECTORS:
Steven McAuley Chief Executive Officer
DISCLAIMER FOR FORWARD-LOOKING STATEMENTS
This news release contains certain "forward-looking statements" or "forward-looking information" (collectively "forward looking statements") within the meaning of applicable Canadian securities laws. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Forward-looking statements can frequently be identified by words such as "plans", "continues", "expects", "projects", "intends", "believes", "anticipates", "estimates", "may", "will", "potential", "proposed" and other similar words, or information that certain events or conditions "may" or "will" occur. Forward-looking statements in this news release include statements regarding; the Company's intention to open a hemp-based CBD extraction facility, the expected benefits to the Company and its shareholders as a result of the proposed acquisitions and partnerships; the terms of the proposed acquisitions and partnerships; the effectiveness of the extraction technology; the expected benefits for Empower's patient base and customers; the benefits of CBD based products; the effect of the approval of the Farm Bill; the growth of the Company's patient list and that the Company will be positioned to be a market-leading service provider for complex patient requirements in 2019 and beyond. Such statements are only projections, are based on assumptions known to management at this time, and are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the forward-looking statements, including; that the Company may not open a hemp-based CBD extraction facility; that the hemp-based CBD extraction facility may not be fully operational in 2019 if at all; that legislative changes may have an adverse effect on the Company's business and product development; that the Company may not be able to obtain adequate financing to pursue its business plan; general business, economic, competitive, political and social uncertainties; failure to obtain any necessary approvals in connection with the proposed acquisitions and partnerships; and other factors beyond the Company's control. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are cautioned not to place undue reliance on the forward-looking statements in this release, which are qualified in their entirety by these cautionary statements. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements in this release, whether as a result of new information, future events or otherwise, except as expressly required by applicable laws.
SOURCE Empower Clinics Inc.
Empower Clinics Reports 2Q 2019 Results (CNW Group/Empower Clinics Inc.)