VANCOUVER, BC, July 20, 2021 /CNW/ - good natured Products Inc. (the "Company" or "good natured®") (TSXV: GDNP), a North American leader in earth-friendly plant-based products, today announced preliminary revenue and gross margin estimates for the three ("Q2 2021") and six ("H1 2021") months ending June 30, 2021.
good natured® expects to report revenue for Q2 2021 in the range of $12.0 million to $12.4 million, an increase of approximately 225% to 240%, compared to $3.7 million for the fiscal quarter ended June 30, 2020. Reported revenue for H1 2021 is expected in the range of $19.9 million and $20.3 million compared to $6.7 million for the six-month period ended June 30, 2020.
Variable gross margin, a non-GAAP measure, for Q2 2021 are expected to be reported between 31% and 34% compared to variable gross margin of 44.3% for the fiscal quarter ended June 30, 2020, which included a higher product mix of COVID-19 medical face shields & packaging at higher-than-average product gross margin. Variable gross margin for H1 2021 is expected to be reported between 34% and 37% compared to 40.7% for the six-month period ended June 30, 2020. Gross margin for Q2 2021 is expected to be reported between 25% and 28% and between 28% and 31% for H1 2021. The Company plans to release full Q2 2021 results in August 2021.
"We are extremely pleased to report another very strong quarter of revenue growth, which included June revenues from our recent acquisition of Ex-Tech," stated Paul Antoniadis, CEO of good natured®. "Our team and partners continue to execute on our strategic direction to provide our customers with North America's leading assortment of plant-based products. The addition of new team members this quarter positions the company to support our ambitious growth plan that is centered on delivering robust revenue growth both organically and through acquisition. Our announcement regarding the capacity expansion at our IPF facility and the acquisition of Ex-Tech are both prime examples of execution on our growth plan and we remain very optimistic on the outlook."
The preliminary results set forth above are based on an initial review of the Company's operating and financial results for the quarter ended June 30, 2021 and are subject to change. Final reported results could differ from these preliminary results following the completion of quarter-end accounting procedures, final adjustments and other developments arising between now and the time that the Company's financial results are finalized, and such changes could be material. The Company's independent auditor, Deloitte LLP, has not audited, reviewed, or performed any procedures with respect to the accompanying preliminary financial results and other data, and accordingly does not express an opinion or any other form of assurance with respect thereto. The preliminary results have been prepared by, and are the responsibility of, the Company's management, and were approved by management on July 19, 2021. In addition, these preliminary results are not a comprehensive statement of the Company's financial results for the quarter ended June 30, 2021. They should not be viewed as a substitute for audited financial statements prepared in accordance with International Financial Reporting Standards and are not necessarily indicative of the Company's results for any future period.
The good natured® corporate profile can be found at: investor.goodnaturedproducts.com
About good natured Products Inc.
good natured® is passionately pursuing its goal of becoming North America's leading earth-friendly product company by offering the broadest assortment of eco-friendly options made from plants instead of petroleum. We're all about making it easy and affordable for business owners and consumers to switch to better everyday products® made from renewable materials and free from chemicals of concern.
Part of the sustainable consumer goods market, good natured® offers over 400 products and services through wholesale and retail channels, including our own e-commerce stores. From plant-based home organization products to compostable food containers, bioplastic industrial supplies and medical packaging, we're focused on delivering a great customer experience to make more plant-based products readily accessible to more people as the path to deliver meaningful environmental and social impact.
For more information: goodnaturedproducts.com
On behalf of the Company:
Paul Antoniadis – Executive Chair & CEO
Contact: 1-604-566-8466
Investor Contact:
Spencer Churchill
Investor Relations
1-877-286-0617 ext. 113
invest@goodnaturedproducts.com
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibilities for the adequacy or accuracy of this release.
Non-GAAP financial measures
We have included in this press release a discussion of the Company's variable gross margin, a non-GAAP measures, for Q2 FY21, H1 FY21, Q2 FY20 and H1 FY20 to provide, what management believes, is a meaningful comparison of the Company's performance in Q2 FY21 and H1 FY21. In this news release, variable gross margin is gross margin excluding fixed production costs such as depreciation, repairs and maintenance, utilities and similar overhead items. The use of variable gross margin by management allows for evaluation of the core aspects of the Company's profit margin as certain fixed production costs that are outside the Company's control are excluded. Variable gross margin does not have a standardized meaning, and therefore may not be comparable to similar measures presented by other issuers.
The following table provides a reconciliation of preliminary gross margin to variable gross margin:
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Q2 2021
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H1 2021
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Low end
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Upper end
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Low end
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Upper end
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Cost of product revenue
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Variable cost of product
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-69%
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-66%
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-66%
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-63%
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Variable gross margin
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31%
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34%
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34%
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37%
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Factory overhead and depreciation
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-6%
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-6%
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-9%
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-9%
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Gross margin
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25%
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28%
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25%
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28%
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Cautionary Statement Regarding Forward-Looking Information
Information regarding the release of Q2 2021 and H1 2021 results, preliminary revenue and gross margin results contained in this press release may constitute forward-looking information within the meaning of securities laws. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
The financial outlook provided in this press release is provided to provide early guidance on the second quarter financial performance of the Company and readers are cautioned that this information may not be appropriate for any other purpose. In preparing the financial outlook, the Company completed an initial review of operations for the three and six months ended June 30, 2121, however actual results may differ materially from the financial outlook provided in this press release as the financial outlook has not been audited or reviewed. When relying on the Company's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed that the material factors referred to herein will not cause such forward-looking statements and information to differ materially from actual results or events. However, there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
Other than as required under securities laws, we do not undertake to update this information at any particular time.
Forward-looking information contained in this news release is based on our current estimates, expectations, and projections, which we believe are reasonable as of the current date. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date. All forward-looking information contained in this news release is expressly qualified in its entirety by this cautionary statement.
SOURCE Good Natured Products
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