VANCOUVER, British Columbia, May 15, 2023 – CubicFarm® Systems Corp. (“CubicFarms” or the “Company”) (TSX:CUB) reports its quarterly financial and operating results for three months ended March 31, 2023. All amounts are in Canadian dollars, unless otherwise stated.
First Quarter Financial Results
- Revenue for the three months ended March 31, 2023 was $455,392, up from $243,912 in the previous year.
- Net losses for the three months ended March 31, 2023 were $4.7 million, compared to a net loss of $8.8 million in the previous year.
- As a result of the Company’s recent cost reduction measures, operating expenses, comprising of selling, general & administrative and research & development expenses, was $3.9 million, reduced from $8.1 million in the previous year.
First Quarter Operational Highlights
- On January 17, 2023, the Company announced the lease of FreshHub machinery and equipment to Langley Indoor Produce Ltd., of which CubicFarms has the option to retain up to 97.6% of the equity interest of this entity. As part of this transaction, CubicFarms granted a license for the underlying FreshHub intellectual property to Langley Indoor Produce Ltd. The use of the license grant is limited to the indoor, non-containerized implementation of the CubicFarms patented equipment. Ongoing funding of Langley Indoor Produce Ltd. will come from third-party investors.
- On March 7, 2023, the Company announced that its livestock feed subsidiary company, HydroGreen, Inc. had finalized the installation of two previously sold machines to Jim Cheney Inc. in Utah.
- On March 17, 2023, the Company announced that it had closed its previously announced overnight marketed public offering, issuing a total of 56,027,000 units at a price of $0.05 per unit for gross proceeds of $2,801,350, including 10,261,000 units issued to reduce working capital obligations of the Company for $513,050 in payables.
“We are pleased to report our first quarter financial results, which demonstrate revenue growth and a significant reduction in net losses compared to the previous year. Our diligent cost reduction measures have yielded positive results, with operating expenses substantially reduced,” said Interim CFO Michael Kyne. “Additionally, our strategic partnerships and successful installations continue to drive operational progress. We remain committed to delivering value to our shareholders and pursuing opportunities for sustainable growth in the agricultural industry.”
HydroGreen produces Automated Vertical Pastures™, a type of smart farming equipment that uses a unique process to sprout grains such as wheat and barley, in a controlled growing environment to efficiently produce a high-performance feed ingredient for livestock 365 days a year. HydroGreen’s equipment is simple and easy to operate and performs all growing functions automatically, including seeding, watering, lighting, harvesting, and re-seeding, which allows livestock businesses to feed consistent nutrition every day with minimal labour. When balanced correctly in the ration, HydroGreen sprouted grain modifies animal digestion which enhances productivity and reduces the amount of enteric methane emitted in ruminant livestock. The result also enables environmental benefits to the farm while helping to meet increasing demand for valuable farm-based inset and offset carbon credits.
CubicFarms is a leading local chain agricultural technology company developing and deploying technology to feed a changing world. Its proprietary ag-tech solutions enable growers to produce high quality, predictable produce and fresh livestock feed with HydroGreen Nutrition Technology, a division of CubicFarm Systems Corp. The CubicFarms™ system contains patented technology for growing leafy greens and other crops onsite, indoors, all year round. CubicFarms provides an efficient, localized food supply solution that benefits our people, planet, and economy.
Forward looking and other cautionary statements
This release may contain certain “forward-looking statements” or “forward-looking information” under applicable securities laws. Such statements involve known and unknown risks, uncertainties, and other factors and assumptions which may cause the actual results, performance, or achievements of CubicFarm Systems Corp., or industry results, to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such statements can be identified by the use of words such as “intend”, “expect”, “believe”, “plan”, “anticipate”, “estimate”, “scheduled”, “forecast”, “predict”, and other similar terminology, or state that certain actions, events, or results “may”, “can”, “could”, “would”, “might”, or “will” be taken, occur, or be achieved.
These statements reflect the Company’s current expectations regarding future events, performance, and results and speak only as of the date of this news release. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Except as required by securities disclosure laws and regulations applicable to the Company, the Company undertakes no obligation to update these forward-looking statements if the Company’s expectations regarding future events, performance, or results change.