Mr. Josh Rosen reports

GOODNESS GROWTH HOLDINGS ANNOUNCES FOURTH QUARTER AND FULL YEAR 2023 RESULTS

Goodness Growth Holdings Inc. has released financial results for its fourth quarter and full year ended Dec. 31, 2023. Key financial results are presented herein in summary form with supporting commentary and discussion from management of certain key operating metrics which the company uses to judge its performance. All currency figures referenced herein are denominated in U.S. dollars.

Management commentary

Interim chief executive officer Josh Rosen commented: "Two thousand twenty-three was a transformational year for our company, and our teams did an excellent job executing our CREAM and Fire strategy to deliver significant improvements in operating and financial performance. We delivered continual improvement in revenue, gross margin and operating profit throughout the course of 2023. We're entering 2024 in a much stronger position because of these improvements and our team is poised to capitalize on what I believe is an attractive platform for growth. As I have stated in the past, derisking our balance sheet was another critical focus for us over the past year, and our announcement this afternoon to divest our New York assets helps position us for an exciting year in 2024."

Amber Shimpa, president and CEO of Vireo Health of Minnesota, commented: "Our operational key performance indicators continued to show strong improvements both during the fourth quarter and over the past 12 months. We remain especially pleased with the progress we've made with our focus on decentralized operations during the year, allowing our local teams and support from partners like Grown Rogue to help drive decision-making for improved product quality and fundamental performance. We believe our continued market outperformance in Maryland's recently launched adult-use market demonstrates that we are ready to compete effectively in adult-use cannabis markets, and we are looking forward to the launch of adult-use sales in Minnesota in 2025. We expect to provide additional updates surrounding our initiatives to ensure a successful adult-use launch in Minnesota in the coming quarters."

Other events

On April 1, 2024, the company executed an eighth amendment to its lease with its landlord, Innovative Industrial Properties, on its cannabis cultivation and manufacturing facilities located in Johnstown, N.Y. The eighth amendment to the Johnstown lease extends a lease termination option until June 30, 2024, and adds a purchase option of the facility for the tenant.

On April 1, 2024, the company announced that it has executed a binding term sheet with ACE Venture Enterprises Inc., whereby Ace will acquire Goodness Growth Holdings subsidiary, Vireo Health of New York, pending regulatory approval. Terms of the transaction include a purchase price between $3-million and $5-million for Vireo Health of New York's licences, inventory and assets, an investment of $20-million from Ace for the development of the Johnstown, N.Y., cannabis cultivation and manufacturing campus, and Ace's assumption of the Johnstown lease agreement with Innovative Industrial Properties. The parties also committed to a collaborative advisory agreement that retains Goodness Growth's management and compliance oversight in return for an approximate 15-per-cent share of net profits.

Balance sheet and liquidity

As of Dec. 31, 2023, total current assets were $148.9-million, including cash on hand of $16-million. Total current liabilities were $179.5-million, including $88.3-million in liabilities held for sale related to the company's businesses in the state of New York. As of Dec. 31, 2023, the company had a total of 232,799,343 shares outstanding on the treasury method basis.

Mr. Rosen concluded: "While we await the closing of our pending transaction to divest our New York operations, we currently remain out of compliance with the covenants in our credit agreement. We are in the midst of ongoing, productive conversations with our secured lender, Chicago Atlantic, to extend our credit agreement and remain committed to divesting New York. We expect to secure this extension within the next 30 days."

Conference call and webcast information

Goodness Growth management will host a conference call with research analysts today, April 1, 2024, at 4:30 p.m. ET (3:30 p.m. CT) to discuss its financial results for its fourth quarter and full year ended Dec. 31, 2023. Interested parties may attend the conference call by dialling 1-800-715-9871 (toll-free) (United States and Canada) or 1-646-307-1963 (toll) (international) and referencing conference ID No. 3718174.

A live audio webcast of this event will also be available in the events and presentations section of the company's investor relations website.

About Goodness Growth Holdings, Inc.

Goodness Growth Holdings is a cannabis company whose mission is to provide safe access, quality products and value to its customers while supporting its local communities through active participation and restorative justice programs. The company is evolving with the industry and is in the midst of a transformation to being significantly more customer-centric across its operations, which include cultivation, manufacturing, wholesale and retail business lines. Today, the company is licensed to grow, process and/or distribute cannabis in four markets and operates 14 dispensaries in three states.

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