TMCnet News
Halo Labs Reports Q2 2019 Financial ResultsHalo Labs Inc. ("Halo" or the "Company") (NEO: HALO, OTCQX: AGEEF, Germany: A9KN) today announced its financial and operational results for the second quarter for the period ended June 30, 2019 ("Q2"). The California market continues to be a significant growth factor for Halo as revenues in Q2 totaled $9,552,012 representing a 356% increase over Q2 2018 (three-month period ended June 30, 2018: $2,093,468) and a 10% increase quarter over quarter in comparison to Q1 2019 (three-month period ended to March 31, 2019: $8,718,503). Q2 2019 Financial and Operational Highlights
Management Discussions
The Company intends to complete a debt settlement with one creditor (the "Debt Settlement"). Pursuant to the Debt Settlement, the Company intends to retire an aggregate of C$2,009,816 of indebtedness in exchange for the issuance of 5,911,222 common shares of the Company (the "Debt Settlement Shares") at a price of C$0.34 per Debt Settlement Share. The indebtedness is held by arm's length parties and will not result in the creation of a new insider or a new control person. The Debt Settlement Shares will be subject to a four-month and one day hold period, subject to approvals as may be applicable. Common Share Compensation of Certain Employees & Independent Contractors. Certain employees and independent contractors of the Company have agreed to accept common shares of the Company ("Compensation Shares") in lieu of the cash compensation. The total aggregate amount of cash compensation to be satisfied is C$4,107,189, which will be satisfied through the issuance of 11,436,961 Compensation Shares at an average price of C$0.36 per Compensation Share. In connection with the above transaction, certain "related parties," for the purposes of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"), are expected to receive Compensation Shares and the issuance thereto will be considered a "related party transaction" for the purposes of MI 61-101. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The Company is exempt from the formal valuation requirement in section 5.4 and the minority shareholder approval requirement in section 5.6 of MI 61-101 in reliance on sections 5.5(a) and 5.7(a), respectively, of MI 61-101 as the fair market value of the subject matter of, nor the fair market value of the consideration for, the transaction, insofar as it involves related parties, is not more than 25% of the Company's market capitalization. Conference Call Investors can call in for Q&A with Kiran Sidhu, Chief Executive Officer, and Philip van den Berg, Chief Financial Officer, at 4:00 p.m. EST on August 14, 2019:
Participant Toll Free Dial-In Number: (866) 211-3166
Non-IFRS Financial Measures This press release uses both International Financial Reporting Standards ("IFRS") and non-generally accepted accounting ("non-GAAP") measures to assess performance. The Company cautions readers about non-GAAP measure that do not have standardized meaning under IFRS and are unlikely to be comparable to similar measures used by other companies. Readers are urged to review the Company's management discussion and analysis with respect to non-IFRS measures in respect of its unaudited consolidated financial statements for the three and six months ended March 31 and June 30, 2019 and for additional disclosures regarding these measures. ABOUT HALO Halo is a cannabis extraction company that develops and manufactures quality cannabis oils and concentrates, which are a growing segment in the cannabis industry. Halo is a global leader in cannabis oil and concentrates, having produced over 4 million grams of oils and concentrates since inception. The Company has expertise across all major cannabis manufacturing processes, leveraging a variety of proprietary processes and products. The Company is led by a strong management team with deep industry knowledge and blue-chip experience. The Company is currently operating in California and Oregon, as well as in Nevada with our partner Just Quality, LLC, and in Lesotho with the Bophelo strategic partnership. For further information see Halo's unaudited consolidated interim financial statements for the three and six months ended June 30, 2019 and 2018 related management's discussion and analysis on the Company's SEDAR profile at www.sedar.com. Cautionary Note Regarding Forward-Looking Information and Statements This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". The forward-looking information and forward-looking statements contained herein include, but is not limited to, the Company's primary business objectives for the current year; the completion of the proposed acquisition of Bophelo Biosciences & Wellness (Pty) Ltd., increasing distribution of Gilt™ and Hush™ branded products, manufacturing and sales of Dab Tabs™ Dablets, completion of the Debt Settlement, completion of the transaction involving issuance of Compensation Shares, roll-out of the XES Sensual, the supply and distribution for sale of the Shatterizer, the expectation to provide updates on new distributor agreements; expected increases to the Company's margin and the timing thereof; the expectation that DabTabs Go™ will be available under the Company's Gilt™ brand and available throughout California, Nevada, and Oregon in the Fall of 2019; the projected growth rate of the CBD market; the expected size of the CBD market in 2022; and the location, completion and production of a hemp processing facility. By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Halo to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: unexpected delays or expenses in connection with Halo's operations, adverse changes to the CBD market, adverse changes in applicable laws; changes in general economic, business and political conditions, including changes in the financial markets and the other any other risks not disclosed in the AIF disclosed under the heading "Risk Factors" in Halo's annual information form for its fiscal year ended December 31, 2018. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Key assumptions used herein include, without limitation, that there will be no unexpected delays or costs in connection with the Company's Cathedral City build out, the Company will be able to identify and negotiate agreements with suitable distribution partners, management's expectations regarding sales of new products will be realized, the introduction of an ERP system and the securing of raw materials will deliver improved margins, an increased sales force in Nevada that will be able to increase distribution effectively, the Company will not encounter any unexpected costs or delays in the completion of a CBD manufacturing facility, the Company's intended CBD manufacturing facility will be able to achieve production levels currently estimated by management and the Company will be able to identify a suitable location for a CBD manufacturing facility in the Emerald Triangle. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice. View source version on businesswire.com: https://www.businesswire.com/news/home/20190812005605/en/ |