MediPharm Labs Reports Full Year & Fourth Quarter 2024 Results
Annual Net Revenue Increase of 27% to $42M, Driven by Record $18M International Medical Cannabis Revenue and Approaching Positive Adjusted EBITDA((1)) for Q4.
TORONTO, March 31, 2025 /PRNewswire/ - MediPharm Labs Corp. (TSX: LABS) (OTCQB: MEDIF) (FSE: MLZ) ("MediPharm", "MediPharm Labs" or the "Company") a pharmaceutical company specialized in precision-based cannabinoids, today announced its financial results for the full year and three months ended December 31, 2024.
Success on Path to Profitability with $8M Adjusted EBITDA((1)) Improvement in 2024 versus 2023.
MediPharm significantly improved profitability in 2024, addressing cost structure and gross profit while simultaneously reducing operating expenses and substantially growing revenues. The Company is in a strong cash position, is materially debt free, up to date on all cannabis excise duties and regulatory fees and currently has full unencumbered ownership of all production facilities.
Full Year 2024 Highlights
-- Net revenue increased by $9M or 27% to $42M versus prior year of $33M
-- Gross profit of $12.8M or 31% representing a significant improvement
over 2023 of $5.8M or 18%
-- Adjusted EBITDA((1)) loss of $1.9M which improved $8.3M or 81% versus
2023. Adjusted EBITDA((1)) continues to improve driven by margin
expansion initiatives and cost reductions
-- Key operations from the Hope facility were transitioned to the Barrie
facility resulting in over $1M in annualized savings. Subsequent to Q4
2024, MediPharm announced the sale of its Hope facility for $4.5M, which
is anticipated to close within the second quarter, subject to customary
closing conditions and receipt of all necessary approvals, as
applicable.((2))
-- Repaid $2M of convertible debt leaving the Company materially debt free.
Q4 2024 Highlights
-- Revenue of $12M increased $2.9M or 32% versus Q4 2023
-- Gross profit of $3.6M or 30% representing a significant improvement over
Q4 2023 of $2.2M or 24%
-- Adjusted EBITDA((1)) loss of $0.1M improved $1.5M or 94% versus Q4 2023
-- International revenue represented 54% of revenue versus 27% in Q4 2023
-- Strong balance sheet, relative to many peer companies, with $11.7M
million of cash and materially debt-free
Three months ended
31-Dec- 30-Sep- 30-Jun- 31-Mar- 31-Dec-
24 24 24 24 23
$'000s
$'000s
$'000s
$'000s
$'000s
Revenue 12,042 9,798 10,350 9,771 9,131
Gross Profit 3,616 3,120 3,418 2,651 2,196
Opex (1) (5,109) (5,442) (5,382) (5,648) (5,020)
Adjusted EBITDA (2) (96) (743) (124) (949) (1,579)
(1) Opex includes general administrative expense, marketing and selling expenses
and R&D expenses.
(2)
Adjusted EBITDA is a non-IFRS measure. See "Non-IFRS Measures".
International Medical Cannabis Revenue growth of 83% in 2024 vs. Prior Year
-- International Medical Cannabis 2024 revenue of $17.7M increased 83% from
$9.7M in 2023 driven by further market penetration, new product launches
in Germany and Australia, and new global and domestic partnerships.
-- International revenue accounted for 54% of Q4 revenue and increased from
$2.4M in Q4 2023 to $6.5M in Q4 2024.
-- Achieved Pharmaceutical GMP certification with Brazilian Health
Regulatory Agency (ANVISA) and is one of just a few North American
companies to receive multiple sanitary authorizations for cannabis
products while holding an ANVISA GMP license.
-- MediPharm continues to focus on innovative and complex pharmaceutical
cannabinoid solutions with global applications, including Dronabinol and
the previously announced global licensing agreement with Remidose
Aerosols Inc. for advanced metered dose inhalers.
Committed to Advancing Patient Outcomes & Consumer Wellness with Premium Products, Clinical Research & CBD Natural Health Product Consultation.
-- MediPharm continues to participate in Health Canada consultations on
Natural Health Products Containing CBD ("NHPCC") and is uniquely
positioned for success in that future channel((2)), with a strong
foundation for potential NHPCC products, given our leadership in CBD
products, GMP facility, and DEL licence.
-- MediPharm remains committed to patients in Canada and abroad, including
engagement in Clinical Research to support pharmaceutical cannabinoid
innovation and clinical advancements. Academic and commercial research
partners have selected MediPharm's pharma-grade products for their
clinical research, with various clinical trials advanced to Phase 1 and
Phase 2 in 2024. Please see the table below for updates on active
research engagements.
Researcher Indication Phase Recent Milestone
USC (University of Treatment of Alzheimer's Phase 2 FDA approval of
Southern California) Agitation Disorder Investigational New Drug
Keck School of (IND)
Medicine
Clinical trial material
("CTM")
delivered, and
enrollment
commenced in Q3 2023
Second CTM delivery
occurred in Q4 2023.
McMaster University Treatment of post-
surgical Phase 2 CTM delivered and
pain enrollment commenced in
Q1 2023
Patient dosing commenced
in
Q2 2023 with last
patient
dosing expected early Q1
2025. (2)
Additional CTM delivered
in
Q1 2024. Enrollment
completed in Q4 2024.
University Health Improving Pain Disability
with Pilot CTM Delivered and
Network - Toronto The Use Of Oral enrollment clinic in Q1
2023.
Cannabinoids
Additional CTM delivered
in
Q1 2024.
McMaster University Insomnia in depressive Phase 2 CTM Shipment in Q1 2023
disorder
Patient dosing commenced
in Q2 2023 with 2/3 of
patients enrolled.
Additional CTM delivered
in
Q1 2024. Enrollment
completed in Q4 2024.
Centre for Medical PK of single dose THC/
CBD in Phase 1 Patient dosing completed
Cannabis Research healthy adult controls
and and data analysis by PI
kidney disease underway.
University of Manitoba Chronic Headaches in Phase 2 Health Canada approval
Dec
Adolescents 2022. CTM shipment in Q1
2023.
Additional CTM delivered
in
Q1 2024.
University of Manitoba Tolerability Study of Phase 2 Health Canada approval
Cannabinoids for symptom
obtained (No Objection
management in pediatric
Letter).
oncology
Material shipped in Q3
2024.
University Health Restless Legs Syndrome Phase 2 PI has submitted
application
Network - Toronto to HC and awaiting
approval.
University of Manitoba Drug Resistant Epilepsy Phase 2 Regulatory package in
preparation with
submission
Q4 24. (2)
BC Cancer Agency Symptom Management in Phase 2 CTM shipments in Q1, Q2,
Cancer Patients Q3, and Q4 2024.
Management Commentary
David Pidduck, CEO, MediPharm Labs commented, "We are pleased with our progress towards profitability in 2024, driven by 80% growth in our International revenues. International represented over 50% of our Q4 revenues, capitalizing on our EU-GMP licensed facilities. We are well positioned for long-term international success and continue to onboard new customers and distribution partners to meet the growing global demand for premium cannabinoid products."
Greg Hunter, CFO, MediPharm Labs added, "2024 was a transformational year for MediPharm Labs with $42M in net revenue representing a 27% increase versus 2023. Gross margins expanded significantly to 31% versus 18% in 2023 and Adjusted EBITDA loss improved from $10M in 2023 to $1.9M in 2024. We are very close to being Adjusted EBITDA positive with Q4 2024 Adjusted EBITDA loss of $0.1M."((1))
An updated company presentation including select highlights from the period ended December 31(st), 2024 will be made available on MediPharm's website, this in lieu of a quarterly earnings call hosted by management.
About MediPharm Labs
Founded in 2015, MediPharm Labs specializes in the development and manufacture of purified, pharmaceutical-quality cannabis concentrates, active pharmaceutical ingredients (API) and advanced derivative products utilizing a Good Manufacturing Practices certified facility with ISO standard-built clean rooms. MediPharm Labs has invested in an expert, research driven team, state-of-the-art technology, downstream purification methodologies and purpose-built facilities with five primary extraction lines for delivery of pure, trusted and precision-dosed cannabis products for its customers. Through its wholesale and white label platforms, MediPharm Labs formulates, develops (including through sensory testing), processes, packages and distributes cannabis extracts and advanced cannabinoid-based products to domestic and international markets.
In 2021, MediPharm Labs received a Pharmaceutical Drug Establishment Licence from Health Canada, becoming the only company in North America to hold a domestic Good Manufacturing Licence for the extraction of natural cannabinoids. The Company carries out its operations in compliance with all applicable laws in the countries in which it operates.
In 2023, MediPharm acquired VIVO Cannabis Inc. which expanded MediPharm's reach to medical patients in Canada via Canna Farms medical ecommerce platform, and in Australia and Germany through Beacon Medical PTY and Beacon Medical GMBH. This acquisition also included Harvest Medical Clinics in Canada which provides medical cannabis patients with Physician consultations for medical cannabis education and prescriptions.
Notes:
(1)
This is a non-IFRS reporting measure. See "Non-IFRS Measures" below.
(2) This is a forward-looking statement and based on a number of assumptions. See "Cautionary Note Regarding Forward-
Looking Information" below.
Non-IFRS Measures
This press release contains references to "Adjusted EBITDA", which is a non-IFRS financial measure. Management believes that this supplementary non-IFRS financial measure provides useful additional information related to the operating results of the Company. This non-IFRS financial measure is not recognized under IFRS and, accordingly, users are cautioned that this measure should not be construed as an alternative to net income (loss) and gross profit determined in accordance with IFRS as measures of profitability or as alternatives to the Company's IFRS-based Financial Statements. The non-IFRS measure presented may not be comparable to similar measures presented by other issuers. Adjusted EBITDA is a measure of the Company's overall financial performance and is used as an alternative to earnings or income in some circumstances. Adjusted EBITDA is essentially net income (loss) with interest, taxes, depreciation and amortization, non-cash adjustments and other unusual or non-recurring items added back. Adjusted EBITDA has limitations as an analytical tool as it does not include depreciation and amortization expense, interest income and expense, finance fees, gain in revaluation of derivative liabilities, taxes, government grants including rent and wage subsidies, one-off transactions, impairment losses on inventory and on fixed assets and intangibles, write down of deposits and share-based compensation. Because of these limitations, Adjusted EBITDA should not be considered as the sole measure of the Company's performance and should not be considered in isolation from, or as a substitute for, analysis of the Company's results as reported under IFRS. Adjusted EBITDA, as used within the Company's disclosure, may not be directly comparable to Adjusted EBITDA used by other reporting issuers. Adjusted EBITDA does not have a standardized meaning and the Company's method of calculating such non-IFRS measure may not be comparable to calculations used by other companies bearing the same description.
The following table reconciles the Company's net operating income (loss) (as reported) and Adjusted EBITDA for the periods presented:
Three months ended
December 31, September 30, June 30, March 31,
2024 2024 2024 2024
$'000s
$'000s
$'000s
$'000s
Net operating loss (1,803) (2,708) (2,573) (3,725)
Adjusted for:
Share-based compensation expense 227 160 576 895
Depreciation and amortization 563 518 731 790
Restructuring related severance expenses 80 87 305 755
Impairment loss on remeasurement of 113 77
assets held for sale
Gain on disposition of assets (20) (276)
Early lease termination cost 70 44
Incremental cost of cannabis inventory 251 110 162 327
acquired in a business combination (1)
Terminal costs for closed facility (2) 95 323
One-off derecognition of liabilities (130)
Write down of inventories (3) 10 27 60
Fair value adjustments in gross profit (53) 519 170 48
Indirect tax reassessments (4) 153 240
Payroll tax assessment 42
Miscellaneous 150 11
Transaction costs (5) 409 278
Adjusted EBITDA (96) (743) (124) (949)
Notes:
---
(1)
This relates to the reversal of a former impairment of a long outstanding receivable.
(2)
Incremental cost of cannabis inventory acquired in a business combination represents the fair value realized on sale of cannabis inventory acquired in a business combination.
(3)
This adjustment is for unusual inventory write-downs only and not the total value of inventory written down.
(4)
This relates to liabilities recognized in connection with notices of reassessment related to prior periods issued by the tax authorities.
(5) This includes non-recurring fees, expenses associated with the evaluation of potential mergers and acquisitions, fees related to reorganization of legal entities, and fees related to the proposed sale
of the Napanee facility, which was terminated in January 2025.
Cautionary Note Regarding Forward-Looking Information
This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate to, among other things, statements regarding: the Company's anticipated sale of the Hope facility, including the anticipated timing for closing; the future of Canadian regulations surrounding natural health products containing CBD; the Company's future success in NHPCC channels; the progress of the Company's clinical research; the Company's ability to onboard new customers and distribution partners to meet the growing global demand for premium cannabinoid products; the Company's progress toward profitability; and the Company's international success and growth potential. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; the inability of MediPharm to obtain adequate financing; the delay or failure to receive regulatory approvals; and other factors discussed in MediPharm's filings, available on the SEDAR+ website at www.sedarplus.ca. There can be no assurance that such statements 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 the forward-looking statements and information contained in this news release. Except as required by law, MediPharm assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.
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