Nova Cannabis (NOVC) investor relations material

Executive summary

• Achieved record Q2 2024 revenue of $69.2 million, up 8.1% year-over-year, driven by proprietary licensing sales, same-store growth in Ontario, and new Dutch Love store acquisitions.

• Gross profit rose 14.8% to $16.8 million compared to Q2 2023; net earnings were $0.9 million versus $1.0 million last year.

• Opened 100th Value Buds store post-quarter, expanding presence in Alberta, Saskatchewan, B.C., and Ontario.

Financial highlights

• Proprietary licensing revenues increased by $1.1 million to $3.8 million year-over-year due to an updated agreement.

• Cash provided by operating activities was $1.5 million, down from $2.6 million in Q2 2023, mainly due to lower non-cash working capital.

• Cash and cash equivalents stood at $5.3 million as of August 1, 2024.

• Adjusted earnings from operations for Q2 2024 were $2.2 million, slightly down from $2.6 million in Q2 2023.

• Free cash flow for Q2 2024 was negative $3.3 million, compared to negative $0.8 million in Q2 2023.

Outlook and guidance

• Plans to expand store footprint in prairie provinces, B.C., and Ontario, leveraging regulatory changes and M&A opportunities.

• Focus on optimizing proprietary data licensing and enhancing retail fundamentals to drive margin and revenue growth.

• Committed to launching new private label products and improving customer experience across channels.