Good Natured Products Inc. Announces Preliminary Unaudited Results for the Second Quarter Ended June 30, 2022

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VANCOUVER, BC, July 19, 2022 /CNW/ – Good Natured Products Inc. (the “Company” or “good natured person®“) (TSXV: GDNP) (OTCQX: GDNPF), a North American leader in herbal products, today announced preliminary revenue and gross margin estimates for the quarter ending June 30, 2022 (“Q2 2022”).

Preliminary Q2 2022 revenue is expected at $24.0 million at $26.0 millionan increase of approximately 95% to 110%, compared to $12.4 million for the three months ended June 30, 2021 (“Q2 2021”). Variable gross margin, a non-GAAP measure1for Q2 2022 should be between 31% and 33% compared to 34.7% for Q2 2021. Gross margin is estimated between 24% and 26% for Q2 2022 compared to 28.3% for Q2 2021.

Revenue growth in Q2 2022 was driven by strong organic growth with the addition of new customers, including a US food producer announced in October 2021increases in the average unit selling price and the contribution of the acquisition of Ex-Tech Plastics made in May 2021.

Gross margin performance has improved in recent quarters due to the implementation of price increases and the integration of the acquisition of Ex-Tech. The lower gross margin in Q2 2022, compared to Q2 2021, was driven by a higher revenue mix of the Company’s industrials group associated with the completion of the acquisition of Ex-Tech, a higher domestic market segment revenue mix and external supply chain and inflationary cost increases.

The company expects to release full second quarter 2022 results in August 2022.

“I am very satisfied with the good results obtained by our good natured person® team delivered in the second quarter, with revenue expected to double year-over-year driven by both strong organic growth and contributions from acquisitions,” said Paul Antoniadis, CEO of good natured person®. “Our gross margins remain within our target range, even in the face of sustained inflationary conditions. Overall, customer demand for our sustainable and environmentally friendly products continues to be robust, and we remain highly focused on serving our customers with strong operational execution. “

The preliminary results presented above are based on an initial review of the Company’s operating and financial results for the second quarter of 2022 and are subject to change. The final results reported may differ from these preliminary results following the completion of quarter-end accounting procedures, final adjustments and other developments occurring between now and the finalization of the Company’s financial results, and such changes could be material. . The Company’s independent auditor, Deloitte LLP, has not audited, reviewed or performed any procedures with respect to the accompanying preliminary financial results and other data, and therefore does not express an opinion or any other form of opinion. insurance about them. Preliminary results have been prepared by and are the responsibility of management of the Company and were approved by management on July 18, 2022. Furthermore, these preliminary results do not constitute a complete statement of the Company’s financial results for Q2 2022. They should not be considered as a substitute for audited financial statements prepared in accordance with International Financial Reporting Standards and are not necessarily indicative of the Company’s results for the second quarter of 2022. any future period.

The good natured person® the company profile can be viewed at: investor.goodnaturedproducts.com

About Good Natured Products Inc.

good natured person® passionately pursues its goal of becoming North America leader in environmentally friendly products by offering the widest assortment of plant-based products made from rapidly renewable resources instead of fossil fuels. The company strives to make it easy and affordable for business owners and consumers to switch from oil to best everyday products® that use more renewable materials, less fossil fuels and no chemicals of concern.

good natured person® offers over 400 products and services through wholesale, direct-to-business and retail channels. From plant-based home organization products to certified compostable food containers, bio-based industrial supplies and medical packaging, the company is focused on making plant-based products more readily available to people to create environmental impact and meaningful social.

For more information: goodnaturedproducts.com

On behalf of the company:
Paul Antoniadis – Executive Chairman and CEO
Phone: 1-604-566-8466

Investor contacts:
Spencer Churchill
Investor Relations
1-877-286-0617 ext. 113
[email protected]

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Non-GAAP Financial Measures

We have included in this press release an analysis of the Company’s variable gross margin, a non-GAAP measure, for the second quarter of 2022 and the second quarter of 2021, in order to provide, what management believes, a meaningful comparison. the Company’s performance in the second quarter of 2022. In this press release, variable gross margin is gross margin excluding fixed production costs such as depreciation, repairs and maintenance, utilities and similar overhead. The use of the variable gross margin by management allows the evaluation of the main aspects of the Company’s profit margin since certain fixed production costs beyond the Company’s control are excluded. Variable gross margin does not have a standardized meaning and therefore may not be comparable to similar measures presented by other issuers.

The following table provides a reconciliation of preliminary and historical gross margin to preliminary and historical variable gross margin (expressed in thousands of dollars)


Q2 2022


Q2 2021


Low end

Upper end



Revenue

24,000

26,000


12,371






Product revenue cost





Product variable cost

(16,560)

(17,420)


(8,080)

Variable gross margin

7,440

8,580


4,291

% variable gross margin

31.0%

33.0%


34.7%






Plant overhead and depreciation

(1,680)

(1,820)


(785)

Gross profit

5,760

6,760


3,506

Gross margin %

24.0%

26.0%


28.3%

Caution Regarding Forward-Looking Information

Information regarding the release of preliminary Q2 2022 revenue and gross margin results contained in this press release may constitute forward-looking information within the meaning of securities laws. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, or other future events, to differ materially from the results, performance or future achievements expressed or implied by such forward-looking statements.

The financial outlook provided in this press release is provided to provide early indications of the Company’s first quarter financial performance and readers are cautioned that this information may not be appropriate for other purposes. In preparing the financial outlook, the Company performed an initial review of operations for the quarter ended June 30, 2022, however, actual results may differ materially from the financial outlook provided in this press release as the financial outlook has not been audited or reviewed. When relying on the Company’s forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors as well as other uncertainties and potential events. The Company has assumed that the material factors referred to herein will not cause such forward-looking statements and information to differ materially from actual results or events. However, there can be no assurance that these assumptions will reflect the actual outcome of such items or factors.

Except as required by securities laws, we do not undertake to update this information at any time.

The forward-looking information contained in this press release is based on our current estimates, expectations and projections, which we believe to be reasonable as of the current date. The reader should not place undue importance on forward-looking information and should not rely on such information as of any other date. All forward-looking information contained in this press release is expressly qualified in its entirety by this cautionary statement.


1 For more information on the non-GAAP measures included in this press release, please refer to the “Non-GAAP Financial Measures” section.

SOURCE Products of good nature

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