Sacramento, California--(Newsfile Corp. - May 1, 2023) - Vibe Growth Corporation (CSE: VIBE) (OTCQX: VIBEF) (the "Company" or "Vibe"), a vertically integrated California cannabis enterprise, is pleased to announce its financial results for the 2022 fiscal year. All financial information is provided in U.S. dollars unless otherwise indicated. The Consolidated Financial Statements and Management Discussion and Analysis ("MD&A") for the year ended December 31, 2022, are available on the Company's SEDAR profile at www.sedar.com and Vibe's website at www.vibebycalifornia.com.
Vibe CEO Mark Waldron commented, "Over the year, we've seen state-wide pricing trends decrease, increased competition from the illicit market, and the overall economic environment impacted revenue. At Vibe, we are focused on increasing profitability and preserving capital. We've implemented numerous strategic initiatives to increase our gross margins through vertical integration and reviewing vendor relationships, which will be realized in the second half of 2023. Even though our 2022 operational results are disappointing, we've had numerous accomplishments with increased efficiencies, quality, and yields at our cultivation operations and rolling out the rebranded Hype products."
"Vibe is positioned to withstand the current storm, stabilize operational cash flow, and acquire accretive private assets. I believe that Vibe will be a California cannabis success once the market tumult subsides. It has been reported that the legitimate California cultivation market lost approximately 25% of its growing area in 2022, resulting in a tightening of supply and a wholesale price recovery. The tightening of the legal market supply bodes well for our vertical integration strategy. Still, the State Government and law enforcement have to do more to curb the supply from the illicit market," added Waldron.
2022 Highlights
- Cash: Position as of December 31, 2022, was $4,546,259
- Dispensary Sales: Dispensary sales for the three and twelve months ended December 31, 2022, were $4,666,820 and $20,706,808, respectively, compared to the comparative 2021 period sales of $6,315,811 and $29,287,569.
- Average Basket Size: The average dispensary basket size, net of taxes, for the respective three and twelve-month periods ended December 31, 2022, were $44.30 and $47.16, compared to the same periods in 2021 of $51.01 and $50.47.
- E-commerce: In 2022, 17.2% of the Company's orders came through its e-commerce platforms compared to 21.5% in the Comparative 2021 period.
- New Dispensaries: On March 11, 2022, the Company opened its fifth California dispensary in Ukiah. The Ukiah dispensary is located at 441 State St. N, Ukiah, and on July 14, 2022, Vibe opened its sixth California dispensary in Salinas. The Salinas dispensary is located at 1031 El Camino Real, Salinas.
- Rebranded Hype Product Line: Following a period of discovery and consumer research, the Company successfully rolled out the rebranded and expanded Hype Product line with new designs and packaging. As well as developing the new brand identity and packaging design, Vibe has also focused on improving its traditional, online, and social media marketing efforts to support Hype's new look. The Company has implemented marketing initiatives such as improvements to Vibe's website and online store, creative social media campaigns, and increased traditional and digital advertising.
Financial Highlights
The Company's key financial results for the three and twelve months ended December 31, 2022, and 2021 are as follows:
| U.S. Dollars | | For the three months ended December 31, 2022 | | | For the three months ended
December 31, 2021 | | | For the year
months ended December 31, 2022 | | | For the year
ended
December 31, 2021 | |
| Total revenue(a) | $ | 4,666,820 | | $ | 6,315,811 | | $ | 20,706,808 | | $ | 29,287,569 | |
| Gross margin | $ | 702,301 | | $ | 1,453,206 | | $ | 6,493,663 | | $ | 8,421,564 | |
| Adjusted Gross Margin(b) | $ | 839,229 | | $ | 1,621,139 | | $ | 7,003,216 | | $ | 9,138,973 | |
| Adjusted Gross Margin(b) | | 18.0% | | | 25.7% | | | 33.8% | | | 31.2% | |
| Goodwill impairment | $ | 3,321,465 | | $ | 1,595,694 | | $ | 3,321,465 | | $ | 1,595,694 | |
| Net loss | $ | 6,675,212 | | $ | 3,340,001 | | $ | 9,450,254 | | $ | 4,298,739 | |
| EBITDA(a) | $ | (2,694,068 | ) | $ | (969,335 | ) | $ | (3,065,303 | ) | $ | 485,817 | |
| Adjusted EBITDA(a) | $ | (2,706,964 | ) | $ | 73,125 | | $ | (3,454,434 | ) | $ | 2,308,864 | |