Empower Clinics Inc (CSE:CBDT) (OTCPINK:EPWCF) (FRA:8EC) has posted fiscal 2020 results that showed a 258% surge in revenue, supported by recent acquisitions.
For the three months ended March 31, 2021, the Vancouver-headquartered integrated healthcare company reported total revenue of $2.04 million, up from $789,135 in 1Q 2020.
As part of total revenue, 1Q clinic services revenue reached $2.03 million, from $767,803 a year earlier. It attributed the increase to the impact of the coronavirus (COVID-19) pandemic, along with the acquisition of Kai Medical Laboratory LLC on October 5, 2020. These were partially offset by a reduction in patients visiting the Sun Valley Health clinics as a result of State legalization of cannabis in November 2020, the company added.
READ: Empower Clinics partners with Pharmachoice to offer Kai Care COVID-19 testing solutions
Increased corporate activity and prior year acquisitions resulted in its loss from operations widening to $1.4 million from $317,831. There was a net loss of $25.2 million, or $0.11 per share, compared to a $525,208 loss in the comparable period, primarily driven by a non-cash loss on the fair value adjustments on outstanding warrants that were impacted by the significant appreciation in Empower's share price.
More specifically, 41.6 million warrants were exercised during the quarter with a weighted average exercise price of approximately $0.10 per warrant. The instruments were exercised when the weighted average share price on the date of exercise was approximately $0.70 per share, resulting in an approximate loss on exercise of $0.60 per warrant.
Empower had $6.29 million in cash as of March 31, 2021, compared to $4.89 million on December 31, 2020, supported by the proceeds generated on the exercise of share purchase warrants.
"Our stellar 1Q performance is a direct reflection of our strategic vision and elevated growth strategy," Empower CEO Steven McAuley said in a statement.
"Targeted partnerships with leading brands in the aviation and pharmacy spaces, combined with our compelling national clinic acquisition approach have all contributed to Empower's tremendous, ongoing success," he added.
Since the end of the reporting period, Empower said it entered into a six-month pilot program with PharmaChoice to sell Kai Care saliva test kits. PharmaChoice is a fast-growing, independently owned Canadian Pharmacy network with more than 900 locations covering the PharmaChoice and RxHealthMed brands.
In June, the company signed a non-binding term sheet to acquire Medisure + Sure Canada Inc, a leading Canadian manufacturer of medical devices for patients managing diabetes.
Contact the author at stephen.gunnion@proactiveinvestors.com