Fire & Flower Holdings Corp. (NASDAQ:FFLWF) reported its fourth-quarter and 2019 financial results. The full-year revenue increased 294% to $51 million versus 2018’s full-year revenue of $12 million. The net loss for the year fell by 14% to $32 million from 2018’s net loss of $37 million.
The fourth quarter’s revenue increased by 61% to $16 million from 2018’s fourth-quarter$22 revenue of $10 million. The fourth-quarter net loss increased by 160% to $22 million from 2018’s fourth-quarter net loss of $8 million.
“The financial and operational results for our fiscal 2019 year and the fourth quarter demonstrate Fire & Flower’s continued track record of meeting our organizational goals. This includes delivering on our store target of 45 open and operating retail locations by the end of the fiscal year and dramatically growing our sales,” shared Trevor Fencott, Chief Executive Officer of Fire & Flower. “Looking forward to fiscal 2020, our focus will be on optimizing and growing our retail network where the Hifyre Digital Retail and Analytics platform continues to be our competitive advantage. We will focus on addressable markets and participating in those markets in a meaningful and accretive fashion to our business.”
The company said it closed the strategic investment with Alimentation Couche-Tard Inc. with an initial investment of $25.9 million (through 2707031 Ontario Inc., an indirect wholly-owned subsidiary). The strategic investment would result in Couche-Tard obtaining a controlling interest in Fire & Flower if all securities issued in connection with the strategic investment are converted/exercised in full.
Fire & Flower also stated that it closed two private placements for aggregate gross proceeds of $28 million with Green Acre Capital LP and AltaCorp Capital Inc. acting as the exclusive financial advisor to Fire & Flower in connection with the offerings. Plus, the company entered into a commitment letter with ATB Financial for senior secured credit facilities of up to $10 million with an option to secure an additional $5 million, subject to ATB Financial’s consent and other customary conditions.
In addition to those moves, the company forced the conversion of all remaining licensed producer debentures through the issuance of 12,223,638 common shares.
Fire & Flower is taking a hard look at its retail empire. The company said it will prioritize expansion in the Ontario market for the current fiscal year, and also intends to enter the British Columbia market once final licensing is complete, and other Canadian markets as regulations permit. In March of 2020, the company acquired the Ottawa and Kingston, Ontario stores that were initially operated under license agreements by two Ontario cannabis retail store license holders. The company said it will close three locations in Alberta so it can focus on locations with higher profit potential.