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SNDL reports third quarter 2023 financial and operational results

(CNW) Calgary — SNDL Inc. reported its financial and operational results for the third quarter ended September 30, 2023. Unless otherwise indicated, all financial information in this press release is reported in millions of Canadian dollars.

THIRD QUARTER 2023 FINANCIAL AND OPERATIONAL HIGHLIGHTS

• Net cash provided by operating activities of $27.5 million in the third quarter of 2023, compared to $8.6 million in the third quarter of 2022.
• Positive free cash flow¹ of $16.5 million in the third quarter of 2023, compared to negative $67.1 million in the third quarter of 2022.
• As of September 30, 2023, SNDL’s unrestricted cash stood at $202.0 million, up from $185.5 million on June 30, 2023. This 8.9 per cent sequential increase can be attributed to effective cash-generating initiatives and operational efficiencies implemented throughout the quarter, particularly in working capital.
• Net revenue for the third quarter of 2023 of $237.6 million, compared to $230.5 million in the third quarter of 2022, an increase of 3.1 per cent.
  • Liquor Retail: Net revenue of $151.8 million for the third quarter of 2023, showing stable revenue compared to the same quarter in the prior year.
  • Cannabis Retail: Net revenue of $75.5 million for the third quarter of 2023, an increase of 14.1 per cent compared to the same quarter of the prior year.
  • Cannabis Operations: Net revenue of $21.0 million for the third quarter of 2023, an increase of 77.4 per cent compared to the same quarter of the prior year.
• Gross margin of $48.6 million in the third quarter of 2023, compared to $50.3 million in the third quarter of 2022, a 3.4 per cent decrease driven by non-cash inventory impairments.
• Net loss of $21.8 million for the third quarter of 2023, compared to a loss of $98.8 million in the third quarter of 2022, an improvement of 77.9 per cent mainly driven by asset impairments recorded in 2022.
• Adjusted EBITDA of $16.1 million for the third quarter of 2023, compared to $18.3 million from the third quarter of 2022.
• SNDL currently has five credit investments in the SunStream portfolio following the monetization of one credit exposure in the third quarter of 2023.

“SNDL’s positive net cash from operating activities and first quarter of free cash flow generation marks a pivotal milestone, reflecting our team’s commitment to operational and financial excellence.” — Zach George, CEO, SNDL

“We are intent on realizing SNDL’s potential for improved profitability, material growth and greater efficiencies across all of our segments. We recently commenced our Liquor Retail data program and continue to see margin improvements in our Cannabis Retail network. In addition, we have rationalized our facility footprint and are moving aggressively into procurement to drive improved results in our Cannabis Operations segment. As previously disclosed, we are in the advanced stages of restructuring key U.S. credit exposures in a manner compliant with U.S. laws. Our commitment to delight consumers remains steadfast as we work to deliver cost-effective, high-quality products and exceptional retail experiences. While we have made significant progress and recognize our achievements, our goals are a far climb from where we stand today. Our industry-leading balance sheet and improved operations enable us to avoid short-term thinking in order to build the foundations of a business that we believe will create sustainable shareholder value through strong free cash flow generation.”