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Australis Capital sees fiscal 4Q revenue soar by 405% and a pre-tax net income of $3M thanks to ALPS

Published: 15:36 26 Aug 2021 EDT

Australis Capital sees fiscal 4Q revenue soar by 405% and a pre-tax net income of $3M thanks to ALPS
Australis said the acquisition of ALPS 'more than doubled revenues for all of FY 2021 even though the company only owned ALPS for the last 23 days of the fiscal year'

Australis Capital, doing business as AUDACIOUS, posted fiscal fourth-quarter results that saw its revenue soar 405% year-over-year thanks to the company's 51% stake in commercial crops facility management firm ALPS, even though the deal was closed less than a month before the fiscal year ended.

For the period ended March 31, 2021, the Las Vegas cannabis company earned a pre-tax net income of $3 million, compared to a pre-tax loss of $10.6 million in the fiscal 4Q of 2020.

“The company benefited from increases in value in its Body and Mind holdings, favorable legacy settlements and cost reductions led by the new management team and other revaluations,” said the company.

READ: Audacious inks deal to acquire California CBD beverage and edibles brand LOOS

The firm said its efforts led to a reduction of 22% in adjusted EBITDA, or earnings before interest, taxes, depreciation, and amortization losses for full year fiscal 2021, compared to FY 2020.

“The acquisition of ALPS more than doubled revenues for all of FY 2021 even though the company only owned ALPS for the last 23 days of the fiscal year,” noted the company.

Australis added that Green Therapeutics was acquired towards the end of fiscal 2021 and “will contribute more substantially to revenues in FY 2022 once the licenses are transferred over to complete the balance of the acquisition.”

On a pro forma basis, assuming ALPS and Green Therapeutics were both consolidated from January 1, 2021, fiscal 4Q revenue would have totaled $1.6 million, compared to reported revenue of $0.5 million for the quarter. Similarly, Australis would have clocked up $5.3 million in full year fiscal 2021 revenue instead of $0.7 million as reported.

Cash and marketable securities remained level at $16.3 million at the end of the quarter, compared to March 31, 2020. Net working capital stayed strong at $16.4 million.

“Total assets roughly doubled to $79.1 million in just one quarter with the two acquisitions,” said the company, while adding that “owners' equity almost doubled as well to $57.9 million.”

Strong outlook for fiscal year 2022

For the 1Q quarter ended June 30, 2021, the company said unaudited preliminary consolidated revenue is estimated at $1.7 million, up 277% from the previous quarter due to the overall growth in the ALPS business.

"Achieving a five-fold increase in our revenues for the quarter, even with ALPS consolidated for only 23 days and no contribution booked from Green Therapeutics, shows the impact of AUDACIOUS transitioning from an investment company to an operating company and reflects the speed at which we are executing," Australis Capital CEO Terry Booth said in a statement.

"In the short time since our new leadership team took over, AUDACIOUS has executed on numerous growth transactions and cleaned up legacy issues.”

The firm said that through its partnership with Belle Fleur it had validated its strategy, which will “see us move into Massachusetts without spending Capex on facilities, while securing the long-term supply of high-quality, cannabis to fuel the scale up of our award-winning brands.”

“The latest addition to our family, LOOS, is positioned for rapid growth in California, as well as other states in which we operate or intend to move into," said Booth. "And this is only the very beginning. Going forward, shareholders can anticipate strong growth, accretive transactions, clever partnerships and multi-state expansion in a capital light way.”

CFO Jon Paul noted that in “just one quarter” Australis is “a much stronger company” solidified by its recent acquisitions.

"As a new management team, we successfully restructured several matters, with almost all disputes now fully resolved. We have rebuilt the finance team and strengthened other areas by bringing in seasoned executives with deep connections in the cannabis industry,” said Paul. “We also streamlined costs by pivoting away from cash burning fintech operations, along with reducing personnel costs, professional fees and other corporate costs.”

Australis also transitioned to new auditors, Baker Tilly, which acquired the company’s previous auditors Squar Milner.

Contact the author Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive

Australis Capital completes 51% acquisition of ALPS

Australis Capital Corp (CSE: AUSA- ITC: AUSAF) CEO Terry Booth joined Steve Darling from Proactive with news the company has closed their 51% acquisition of ALPS, which is a global leader in facility design, construction management and (post) commissioning services to the horticultural...

on 03/16/2021