TORONTO, ON --(Marketwired - May 29, 2017) - Golden Leaf Holdings Ltd. ("GLH" or
the "Company") (CSE: GLH) (CSE: GLH.CN) (CNSX: GLH) (OTCQB: GLDFF), a leading cannabis oil solutions company built
around recognized brands, today announced its unaudited financial results for the first quarter ended March 31, 2017 ("Q1 2017").
Please click here to
access the Company's filings on the SEDAR website.
GLH will hold a shareholder update call on Tuesday, May 30 at 4:15 pm ET to discuss the results. The dial-in numbers for the
financial overview and shareholder update call are as follows:
Canada & U.S.: (800) 895-0198
International: (785) 424-1053
Passcode: 43038
Renewed Revenue Growth in 2017: Achieving Strategic Acquisition Objectives, Capital Raise Completion and New Board
Member Slate Announced
Despite facing significant regulatory challenges in Oregon's cannabis industry in 2016 as previously communicated, the Company
overcame obstacles and positioned itself in 2017 for renewed revenue growth and success. Unaudited Q1 2017 sales of GLH's brands
in Oregon and Washington state of nearly $6M CAD showed a 33% increase versus Q1 2016, and more than a 70% increase versus the
fourth quarter of 2016 ("Q4 2016"). Furthermore, the Company expects quarterly revenue to increase significantly after the close
of the four strategic acquisitions.
While many competitors failed to survive in Q4 2016 because of regulatory upheaval, GLH's management team developed a strategy
to become the leading consolidator of high-value cannabis brands. The Company began executing on this targeted acquisition
strategy aimed at future success by signing four binding Letters of Agreement with Chalice LLC, a leading vertically integrated
cannabis company in Oregon, the vape company JuJu Joints, Canadian based Medical Marihuana Group Corporation which has a pending
application to become a licensed producer and NevWa, LLC the owner of cultivation and extraction licenses in Nevada. In
connection with executing on this strategy, the Company has negotiated to fund the Company's acquisitions and existing
operations.
In addition, GLH recently announced three new independent director nominees for the Board slate at its Annual General Meeting
("AGM") scheduled at 11:00 am ET on June 28, 2017 in Toronto. The proposed Board of Directors (which will consist of seven
directors) has the skills and experience necessary to provide the Company with strong and relevant governance in its next phase
of growth.
The nominees for the Board of Directors for the upcoming AGM include, Don Robinson, Alex Winch, Michael Cohl, Peter Saladino,
Gary Yeoman, Bob McKnight and Gary Zipfel.
Gary Yeoman
Mr. Yeoman, who upon nomination will become GLH's board chairman, has served as the Executive Chair of iLOOKABOUT since June
2013, after previously serving as a consultant to the company. He is also the President of Yeoman and Associates Inc., a private
real estate consulting company. From 2005 to 2011, Mr. Yeoman served as CEO of Altus Group, a TSX-listed real estate consultancy
firm that supplies software, data and analytics intelligence. During his term as CEO, he led Altus through a seven-year growth
period during which the company increased revenues from $75 million to approximately $325 million. During this period, Mr. Yeoman
reorganized, re-focused and directed the business expansion from 15 Canadian offices to over 65 offices with business in 64
countries, orchestrating the acquisition of 25 companies located in six different continents at an approximate capital cost of
$250 million.
Bob McKnight
Mr. McKnight co-founded Quiksilver, Inc. in 1976 and has served as the company's President, CEO and Chairman of the board of
directors from its inception until 2015. Under his watch, Quiksilver grew from a startup to a worldwide corporation with revenues
of $2.5 billion. Today, Quiksilver is a globally diversified, world leader in outdoor lifestyle apparel with their three main
brands of Quiksilver, Roxy and DC. Quiksilver, Inc. has over 5000 employees, operates in over 100 countries and has close to 700
retail stores in the world. Today, Mr. McKnight serves as a consultant and ambassador to the company, and manages the Quiksilver
Foundation.
Gary Zipfel
Mr. Zipfel served as capital partner and board level advisor for start-up stage companies, providing business planning,
strategic direction, and scenario analysis. Mr. Zipfel worked with companies from a diverse array of industries including
cannabis, vertical green space appliances, mountain home design and construction, commercial real estate, bicycle parts design
and manufacturing, digital advertising, jet engine repair, healthcare notification systems, restaurants, and breweries.
Overview of Q1 2017 Results in Oregon: Revenues Flat vs. Q1 2017, Up Significantly vs. Q4 2016, Cost Cutting Reduces
Adjusted EBITDA Loss
The Company generated revenues of $2,259,094 for the three months ended March 31, 2017, a slight decrease compared to
$2,316,688 for the three months ended March 31, 2016, but a significant increase compared to $434,967 for the three months ended
December 31, 2016. In Q1 2017 the revenues increased by over 400% versus Q4 2016.
On an Adjusted EBITDA basis, GLH reported a reduced EBITDA loss of $(1,854,565) for the three months ended March 31, 2017
compared to an EBITDA loss of $(2,346,339) for the three months ended March 31, 2016 and an EBITDA loss of $(2,074,566) for the
three months ended December 31, 2016. This EBITDA loss improvement and positive trend is a result of the Company's focus on
continued cost-cutting and efficiency gains. In addition, GLH expects to recognize margin improvements once the Company begins
manufacturing its own oils and edible products in its new Eugene, Oregon production facility.
Adjusted EBITDA is a non‐GAAP financial measures and does not have any standardized meaning prescribed by the Company's GAAP
and is therefore unlikely to be comparable to similar measures presented by other issuers. See "Non‐GAAP Disclosures" below for
additional information and the attached chart "GLH Q1 2017 Adjusted EBITDA Financials" for additional information.
Don Robinson, CEO of GLH commented, "Although revenue in Oregon for our first quarter of 2017 was flat year-over-year, we did
show a significant increase in revenue growth as compared to the fourth quarter of 2016, and the Company remains optimistic for
future quarters when it will be able to expand its wholesale product mix to include value priced cartridges, dabbable oils,
edibles, and a wider variety of flower options. The new licensing and product line additions we launched in the beginning of 2017
have begun to bear fruit, and we are seeing this growth within both the Oregon and Washington state markets. We expect to launch
the GLH Oregon brands in Washington and the BMF Washington brands in Oregon later in 2017. In addition, the Company plans to
launch its portfolio of brands in Nevada upon completion of the NevWa, LCC acquisition. Moreover, we have made great strides
executing on the strategic acquisition program we announced in early January that we believe will drive financial and shareholder
value for our Company and our stakeholders."
About Golden Leaf Holdings Ltd.:
Golden Leaf Holdings Ltd. is one of the largest cannabis oil and solution providers in North America. It's a leading cannabis
products company in Oregon built around recognized brands. GLH leverages a strong management team with cannabis and food industry
experience to complement its expertise in extracting, refining and selling cannabis oil.
Non-GAAP Disclosure
Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, less all non-cash equity
compensation expenses, including impairments, one-time transaction fees and all other non-cash items. Adjusted EBITDA is a
non-GAAP financial measure which does not have any standardized meaning prescribed by the Company's GAAP and is therefore
unlikely to be comparable to similar measures presented by other issuers. It should not be considered in isolation as a
substitute for measures of performance prepared in accordance with the Company's GAAP. Please refer to the Company's management's
discussion and analysis for the year ended December 31, 2016 for further information on the Company's use of Adjusted EBITDA and
a reconciliation of Adjusted EBITDA to net earnings.
Cautionary Note Regarding Forward-Looking Information
This press release contains "forward-looking information" within the meaning of applicable securities legislation.
Forward-looking information includes, but is not limited to, statements with respect to the Company's future business operation,
expectations of gross sales, the opinions or beliefs of management, and future business goals. Generally, forward looking
information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or
variations of such words and phrases or state that certain actions, events or results "will", "may", "could", "would", "might" or
"will be taken", "will be able to", "will occur" or "will be achieved". Forward-looking information is subject to known and
unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements
of the Company to be materially different from those expressed or implied by such forward-looking information, including but not
limited to general business, economic and competitive uncertainties, regulatory risks including risks related to the expected
timing of the Company's participation in the Adult Use market, market risks, risks inherent in manufacturing operations and other
risks of the cannabis industry. Although the Company has attempted to identify important factors that could cause actual results
to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be
as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual
results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not
place undue reliance on forward looking information. Forward-looking information is provided herein for the purpose of presenting
information about management's current expectations relating to the future and readers are cautioned that such information may
not be appropriate for other purpose. Forward-looking information is based on estimates and opinions of management at the date
the statements are made and the Company does not undertake to update any forward-looking information, except in accordance with
applicable securities laws. This Release does not constitute an offer of securities for sale in the United States, and such
securities may not be offered or sold in the United States absent registration or an exemption from registration.
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