Mr. John Arbuthnot reports

DELTA 9 REPORTS FINANCIALS FOR Q3 2023

Delta 9 Cannabis Inc. has released its financial and operating results for the three-month and nine-month periods ending Sept. 30, 2023.

Financial highlights for the three-month period ending Sept. 30, 2023:

• Net revenue of $18.4-million for the third quarter of 2023, an increase of 18 per cent from $15.7-million for the same quarter last year:
  • Sequential net revenue increased 1 per cent versus $18.3-million for the three-month period ending June 30, 2023;
• Gross profit of $4.9-million for the third quarter of 2023, an increase of 157 per cent from $1.9-million for the same quarter last year;
• Gross profit margin of 27 per cent for the third quarter of 2023, an improvement from 12 per cent for the same period last year;
• Cash operating expenses of $4.6-million for the third quarter of 2023, a reduction of $852,000 from the same period the previous year. The company is on pace to achieve its target operating expense reductions of $3-million to $4-million annualized in 2023;
• Loss from operations of $4.5-million for the third quarter of 2023, versus a loss from operations of $6.2-million for the same quarter last year;
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $1.0-million for the third quarter of 2023, versus an adjusted EBITDA of negative $1.7-million for the same quarter last year.

Financial highlights for the nine-month period ending Sept. 30, 2023:

• Net revenue of $53.6-million for the first nine months of 2023, in increase of 17 per cent compared with $45.7-million for the same period last year;
• Gross profit of $14.4-million for the first nine months of 2023, versus $9.5-million for the same period last year;
• Gross profit margin of 27 per cent for the first nine months of 2023, an improvement from 21 per cent for the same period last year;
• Cash operating expenses of $14.7-million for the first nine months of 2023, a reduction of $1-million from the same period last year;
• Loss from operations of $9.2-million for the first nine months of 2023, versus a loss from operations of $12.6-million for the same period last year;
• Adjusted EBITDA of $1.9-million for the first nine months of 2023, versus an adjusted EBITDA of negative $3.8-million for the same period last year;
• Cash flows from operations of $2.7-million for the first nine months of 2023;
• Repayment of $1.97-million of borrowings for the first nine months of 2023, resulting in annual interest payment savings of approximately $100,000.

"Our team delivered a record third quarter with higher revenues sequentially and year over year, and with better margins driven by the execution of our strategic plan," said John Arbuthnot, chief executive officer of Delta 9. "We are enjoying the gains from our retail expansion announced last year and from our cost-saving initiatives announced in early January, 2023. We are delivering on our commitment to grow revenue, drive operating efficiencies, and improve margins and profitability, while investing in our industry-leading retail brands."

A comprehensive discussion of Delta 9's financial position and results of operations is provided in the company's management discussion and analysis for the three-month and nine-month periods ending Sept. 30, 2023, filed on SEDAR+ on Nov. 14, 2023.

2023 third quarter results conference call

A conference call to discuss the above results is scheduled for Nov. 15, 2023. The conference call will be hosted that day at 11 a.m. Eastern Time by Mr. Arbuthnot and Jim Lawson, chief financial officer, followed by a question-and-answer period.

Date:  Nov. 15, 2023

Time:  11 a.m. Eastern Time

Dial-in number:  1-888-886-7786

Replay:  1-877-674-6060 (available until 12 a.m. Eastern Time on Dec. 15, 2023)

Replay passcode:  086196 followed by the pound key

About Delta 9 Cannabis Inc.

Delta 9 is a vertically integrated cannabis company focused on bringing the highest-quality cannabis products to market. The company sells cannabis products through its wholesale and retail sales channels and sells its cannabis grow pods to other businesses. Delta 9's wholly owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical and recreational cannabis and operates a 95,000-square-foot production facility in Winnipeg, Man., Canada. Delta 9 owns and operates a chain of retail stores under the Delta 9 Cannabis Store brand. Delta 9's shares trade on the Toronto Stock Exchange under the symbol DN and on the OTC (over-the-counter) market under the symbol DLTNF.

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