Revenue for the quarter up 16% year over year
Commenced trading on the TSX-V under the ticker "WOLF"
TORONTO, April 24, 2023 /CNW/ - Grey Wolf Animal Health Corp. (TSXV: WOLF) ("Grey Wolf" or the "Company"), a Canadian diversified animal health company, today reported financial results for the fourth quarter and year ended December 31, 2022.
Highlights
- Revenue for the quarter increased year over year by 16.2% to $5.5 million. Revenue increased by 72.8% to $22.6 million for the year.
- Gross profit increased year over year by 10.8% to $2.8 million for the quarter and 61.8% to $11.6 million for the year.
- Adjusted EBITDA1 was $0.7 million for the quarter and increased 78.3% to $3.5 million for the year.
- Completed the previously announced qualifying transaction with Magen Ventures I Inc. ("Magen") during the fourth quarter and commenced trading on the TSX-V under the ticker symbol "WOLF".
"2022 was another successful year for Grey Wolf. We saw strong revenue growth in the quarter and the year driven by organic growth in both our Animal Health business unit and Pharmacy business unit. Our integrated sales and marketing strategy to both established brands and new product launches continues to increase our reach and frequency into clinics and supports our organic growth." said Angela Cechetto, Chief Executive Officer.
"During the fourth quarter, we completed the qualifying transaction with Magen and commenced trading on the TSX-V. This is yet another transformational step in our journey as a company and positions us well to pursue future growth initiatives as we continue to build a diversified animal health company" added Ms. Cechetto.
Key Financial Data and Comparative Results
Results of Operations for the Fourth Quarter and Year-ended December 31, 2022
Revenue for the three- and twelve-month periods ended December 31, 2022, increased 16.2% to $5.5 million and 72.8% to $22.6 million, respectively, over the same periods in 2021. These increases were mainly due to organic revenue growth from the Animal Health business unit during 2022 as well as a full-year contribution from the Pharmacy business unit (versus four-months contribution in 2021).
Gross margins for the three- and twelve-month periods ended December 31, 2022, decreased to 51% compared to 53% and 55%, respectively, over the same periods in 2021. Gross margins were impacted by a full year contribution from the Pharmacy business unit and product mix in the Animal Health business unit. As a reflection of a trend throughout the global economy during 2022, cost of sales also increased due to (i) price increases paid for finished goods as suppliers of finished goods experienced increases to the prices of components, ingredients, and other inputs and (ii) increased shipping costs.
Total expenses for the three- and twelve-month periods ended December 31, 2022 increased 10.1% to $2.9 million and 68.4% to $11.9 million over the same periods in 2021. The increase is related to operational growth as well as the resumption of in-person sales and marketing activities that did not occur in 2021. Finally, there was also an increase in professional fees and outside services related to the Magen Transaction, completed in 2022, as compared to professional fees and outside services related to Grey Wolf's financing activities and the Trutina Acquisition completed in 2021.
Adjusted EBITDA1 increased to $0.7 million in the fourth quarter 2022 versus $0.4 million in the prior year's quarter. For the year Adjusted EBITDA1 increased 78.3% to $3.5 million from $2.0 million in 2021.
Cash and cash equivalents were $6.9 million at December 31, 2022 compared to $4.4 million in 2021. As at December 31, 2022, the Company had outstanding borrowings of $10.1 million, of which $1.05 million are current and $9.05 million are non-current. The Company's debt bears fixed interest at a rate of 4.0% per annum on $10,000,000 and 10.0% per annum on the remaining $1,500,000 until September 2026.
Grey Wolf's financial statements and accompanying Management Discussion and Analysis for the three and twelve months ended December 31, 2022 are available under the Company's profile on www.sedar.com.
1Non-IFRS Measures
Management uses both IFRS and Non-IFRS Measures to assess the financial and operating performance of the Company's operations. These Non-IFRS Measures are not recognized measures under IFRS, do not have a standardized meaning under IFRS and are unlikely to be comparable to similar measures presented by other companies. The Non-IFRS Measures referenced in this press release includes Adjusted EBITDA. The Company defines Adjusted EBITDA as earnings before financing and special transaction costs (including, for greater certainty, fees related to the Magen Transaction, the Trutina Acquisition and related financing), interest and accretion expenses, income taxes, depreciation of property and equipment, depreciation of right of use assets, amortization of intangible assets, share-based compensation, change in fair value of embedded derivatives, foreign exchange gains or losses, change in fair value of contingent consideration, and other income.. The Company considers Adjusted EBITDA as a key metric in assessing business performance and an important measure of operating performance and cash flow, providing useful information to investors and analysts.
The following table provides a summary of the differences between Grey Wolf's consolidated IFRS and Non-IFRS financial measures, which are reconciled below:
EBITDA and Adjusted EBITDA
About Grey Wolf Animal Health Corp.
Grey Wolf Animal Health Corp., headquartered in Toronto, Canada, is a diversified animal health company founded by a veterinarian to bring to market a broad portfolio of products that meets the unmet needs of veterinarians, clinics and pets. The Company's strategy is to in-license, acquire or develop innovative prescription and non-prescription products for commercialization in the veterinarian channel in Canada. For additional information, please visit: www.greywolfah.com.