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Cannara Biotech Inc. Reports Strong First Quarterly Profit Driven by Retail Debut Third quarter revenue of $ 7.2 million , gross profit of $ 4.4 million , and net income of $ 1.7 million showcases success of market strategy and operating model MONTREAL , July 28 , 2021 / CNW Telbec / - Cannara Biotech Inc. ( " Cannara " or the " Company " ) ( TSXV : LOVE ) ( OTCQB : LOVFF ) ( FRA : 8CB ) , a vertically integrated producer of premium - grade cannabis and derivative products with two Quebec- based mega cultivation facilities spanning over 1.65 million sq . ft . , announced today its third quarter financial and operating results for the three and nine month periods ended May 31 , 2021. All financial results are reported in Canadian dollars , unless otherwise noted . cannara TSXV : LOVE.V OTCBQ : LOVFF FRA : 8CB Third Quarter 2021 Highlights • Total revenue of $ 7.2 million , including $ 5.9 million in cannabis sales , net of excise tax . • Gross profit of $ 3.5 million or 49 % and $ 4.4 million or 62 % after fair value adjustments . • Operating expenses are down by 27 % to $ 2.2 million in Q3 2021 from $ 3.0 million in Q3 2020 . • Adjusted EBITDA of $ 1.7 million or 23 % . • Net income of $ 1.7 million or 24 % . • Sold approximately 1,400 kg of cannabis it had in inventory from previous harvests for a total value of $ 1,265,000 . • Uplisted to the TSX Venture ( TSXV ) from the Canadian Stock Exchange ( CSE ) on April 8 , 2021 , reflecting Company's maturity and the commercialization of its operational strategy . " This quarter's results are a testament to our strategy's efficacy and management's focus , " said Zohar Krivorot , President & Chief Executive Officer of Cannara . " With impressive revenue generation in our first full quarter of sales in retail market , the closing of our additional $ 5 million private placement and headline acquisition of our latest one million square foot facility in Valleyfield , we are now positioned among the country's leading cannabis producers . " " Our positive net income and strong gross margins confirm our operational excellence , uniquely lean company structure , and continued growth , " said Nicholas Sosiak , Chief Financial Officer of Cannara . " Cannara's core competence is our differentiated model that underscores our ability to excel at maximizing the use of our resources . We are executing against this proven model , as we continue to scale our business in the next chapter of our growth roadmap . " Highlights Subsequent to Quarter End • Acquired a one million sq . ft . state - of - the - art cultivation facility from The Green Organic Dutchman Ltd. ( " TGOD " ) for $ 27 million , providing Cannara the ability to reach an annual cultivation capacity of 125,000 kg of premium - grade cannabis . • Closed private placements of $ 24.3 million priced at a premium to the market price at time of the transaction and $ 5.7 million in convertible debentures bearing interest at 4 % to fund the acquisition of the Valleyfield facility and related working capital expenditures . • Converted the Company's existing $ 5 million credit facilities bearing interest at 13 % into a convertible debenture bearing 4 % interest and subject to a statutory hold period of four months and one day from the date of issuance . • Granted an aggregate total of 425,000 stock options to certain employees at an exercise price of $ 0.18 per common share , subject to certain vesting conditions . • Launched an additional six SKUs in market under the Tribal and Orchid CBD brands in June 2021 . • Released three new cannabis genetics , Cuban Linx , Do - Si - Dos , CBD Runtz , in dried flower and pre - roll formats .