VANCOUVER, British Columbia, Jan. 31, 2025 (GLOBE NEWSWIRE) -- Christina Lake Cannabis Corp. (the “Company” or “CLC” or “Christina Lake Cannabis”) (CSE: CLC) (OTCQB: CLCFF) (FRANKFURT: CLB) is pleased to provide the following business update.
In 2023 the Company identified a need to secure the supply chain of biomass and flower as part of a strategy to meet growing customer demand and allow for much needed product and customer diversification. To address that need, the Company acquired a new outdoor cultivation facility in Midway, British Columbia as previously announced on February 12, 2024.
The remainder of the year was focused on preparing the facility and execution of the inaugural crop at the Midway facility. The total cultivation footprint increased by approximately 100 acres which was challenging in terms of resources required and there were many lessons learned. Despite those challenges the CLC team was able to successfully complete the 2024 harvest.
The planting style and density was different than the Christina Lake site with plants grown directly in ground. The total harvest from the Christina Lake and Midway sites yielded approximately 105,000 kilograms of combined weight in extraction grade biomass and flower. The increase in harvested mass contributed to the growth in inventory value as at November 30, 2024 by approximately 81% compared to the prior year. The increase in harvested mass required additional labour force and other resources for both the field preparation, planting, and fall harvest as evidenced in the increase in capitalized expenses which increased by approximately 100%. In addition to ongoing distillate production, the Company will be dedicating increased resources to grading and trimming flower to fulfill sales in 2025.
Last year CLC was required to purchase biomass from outside sources to supplement the previously announced approximate 38,000 kg’s of biomass and flower harvested in 2023. With our expansion, we are no longer reliant on external feedstock sources.” said CEO Mark Aiken.
As reported in the financial statements for the period ending November 30, 2024 the company increased revenue by approximately 16% with growth largely driven by products produced from external feedstock sources. Cost of Goods Sold only increased by approximately 1% and as a result, gross margin improved by approximately 7.9% from the comparative period in 2023. The improved margin was due to a shift in product mix with increased sales of higher margin products such as outdoor flower.
Total General and administrative expenses decreased by approximately 5% from the prior year. The reduction was primarily related to a large decrease in impairment taken against property, plant, and equipment in the comparative period. Notable increases in other expenses related to expansion included salaries increasing by 41%, repairs and maintenance by 48%, and regulatory fees by 139%. A bad debt expense of $324,074 was also recognized in the year.
As previously announced, the Company completed the final tranche of a non-brokered private placement in December 2024 with gross proceeds of $3,108,375 through the issuance of 94,193,182 common shares in the offering. The proceeds were for a combination of working capital and settlement of outstanding convertible debt of the Company. The need for working capital was driven by a combination of the seasonality of the business in which significant capital is front loaded towards a single crop in the fall, combined with additional capital required to grow and harvest the expanded footprint noted previously.
In addition, the Company had been carrying significant debt in the form of Convertible Debentures with large debenture repayments upcoming in 2025. The Company proactively settled debt through the issuance of common shares at a price equal to the concurrent private placement, resulting in approximately $1,825,875 of debt reduction. As at November 30, 2024, the Company was carrying $9,292,924 in Convertible Debenture liabilities. In 2025 the Company will continue to focus on reducing debt levels.
“We expect 2025 to be another strong year of growth underpinned by this year’s solid harvest numbers.” said CEO Mark Aiken.
About Christina Lake Cannabis Corp.
Christina Lake Cannabis is a licensed producer of cannabis under the Cannabis Act with a standard cultivation license and corresponding processing amendment from Health Canada as well as a research and development license. Christina Lake Cannabis’ facilities consist of a 32-acre property, which includes over 950,000 square feet of outdoor grow space, offices, propagation and drying rooms, research facilities, and a facility dedicated to processing and extraction. A 342-acre property which includes approximately 100-acres of licensed outdoor grow space, green houses, and a dry room. Christina Lake Cannabis also owns a 99-acre plot of land adjoining its principal site. CLC focuses its production on creating high quality outdoor flower, extracts and distillate for its B2B client base.
On behalf of Christina Lake Cannabis:
“Mark Aiken”
Mark Aiken, CEO
For more information about CLC, please visit: www.christinalakecannabis.com
Jennifer Smith
Investor Relations and Media Inquiries
investors@clcannabis.com
902-229-7265
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This News Release includes certain "forward-looking statements" which are not comprised of historical facts. Forward-looking statements include estimates and statements that describe the Company’s future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as “believes”, “anticipates”, “expects”, “estimates”, “may”, “could”, “would”, “will”, “likely”, “probably”, “often”, or “plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to the Company, the Company provides no assurance that actual results will meet management’s expectations. Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, future crop sizes and expected yields, sales of flower and biomass, future harvest results, future debt settlements or repayment of outstanding debts, the Company’s objectives, goals or future plans, statements, harvesting results, and estimates of market conditions. Factors that could cause actual results to differ materially from such forward-looking information include future growth potential of the Company, fluctuations in general macroeconomic conditions, fluctuations in securities markets, expectations regarding the size of the future harvest, fluctuations on pricing within cannabis markets, the ability of the Company to successfully achieve its business objectives, plans for expansion, inability to obtain adequate insurance to cover risks and hazards and general market conditions. Additional factors and risks including various risk factors discussed in the Company’s disclosure documents which can be found under the Company’s profile on http://www.sedarplus.ca. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected
Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. These statements speak only as of the date of this news release. The Company assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.
