Rightsizing of Napanee Organization
Board and Leadership Changes
TORONTO, Oct. 20, 2020 /CNW/ - VIVO Cannabis Inc. (TSX: VIVO) (OTCQX: VVCIF) ("VIVO" or the "Company") today announced immediate steps to streamline operations and changes to the Board and Leadership Team.
Organizational Rationalization, including an 18% Reduction in Headcount
The Company is dedicated to delivering differentiated cannabis products and services while carefully managing expenses, with a target of achieving positive adjusted EBITDA during the first half of 2021.
"Our goal is to make VIVO a stronger, more focused company by leveraging synergies between our business units and adapting to the realities of the market," said Barry Fishman, Chief Executive Officer. "This includes making the difficult decision to reduce our workforce, a move that was not taken lightly, and we remain grateful to all those affected for their previous efforts and contributions. These changes will allow VIVO to reduce costs by specializing resources and streamlining our organizational structure."
The streamlining initiatives are expected to accelerate the timeframe to achieving positive operating cash flow. Approximately 18% of overall Company headcount (roughly 45 positions) will be eliminated this week, the vast majority from the rightsizing of Napanee operations.
After completing a strategic review of VIVO's overall Canadian cannabis operations, the Napanee-based organization has been re-purposed to focus on low-cost cultivation (airhouse-grown) and the extraction and manufacturing of VIVO's growing line of Cannabis 2.0 concentrates. To allow the Company to capitalize on economies of scale and reduce costs, certain other activities (i.e. packaging and distribution) will be centralized at the Canna Farms facility in Hope B.C.
VIVO will also be monetizing non-core assets, and capital expenditures will be curtailed as all major facility projects have been completed. The actions taken this week will better align the business with the demands and evolution of the cannabis market, and well-position the Company for future profitable growth.
Board and Leadership Changes
Dan Laflamme has decided to step down as President, Canna Farms and a Director of the Company. Ray Laflamme, co-founder of Canna Farms, has been appointed interim President, Canna Farms to ensure a smooth transition.
"The entire VIVO team and Board would like to thank Dan for his significant contributions to the Company, and to his family for their support. We wish them well as they spend some well-earned time together." said Barry Fishman. "As a co-founder of Canna Farms and one of the pioneers of the Canadian cannabis industry, we are grateful to Dan for his vision, leadership, integrity and passion. We are also fortunate to have Ray accept the Canna Farms interim President role. Ray brings significant institutional knowledge about the business and his continued leadership will serve us well."
Dan Laflamme added, "The past seven years have been a wonderful experience and I have enjoyed working with the Canna Farms team and everyone across the other VIVO businesses. Although I am resigning from my active role with the Company, I will certainly continue to support VIVO and Canna Farms as they enter the next phase of growth."
VIVO also announced changes to its senior leadership team to best support the execution of its strategic priorities. The Company will now be more aligned on centralized functions, replacing the previous business unit focus. The VIVO senior leadership team, effective immediately, is summarized below:
Barry Fishman: |
Chief Executive Officer and Director |
Michael Bumby: |
Chief Financial Officer |
Carole Chan: |
Chief People Officer and President, Harvest Medicine |
Tim Hayden: |
Chief Business Officer |
Matt Patterson: |
Chief Commercial Officer |
Ray Laflamme: |
Interim President, Canna Farms |
Andreas Sander: |
President, European Operations |
About VIVO Cannabis™
VIVO Cannabis™ is recognized for trusted, premium cannabis products and services. It holds production and sales licences from Health Canada and operates world-class indoor and seasonal airhouse cultivation facilities. VIVO has a collection of premium brands, each targeting different customer segments, including Canna Farms™, Beacon Medical™, Fireside™, Fireside-X™, Lumina™ and Canadian Bud Collection™. Harvest Medicine, VIVO's patient-centric, scalable network of medical cannabis clinics, has serviced over 100,000 patient visits. VIVO is pursuing several partnership and product development opportunities and is focusing its international efforts on Germany and Australia. For more information visit: www.vivocannabis.com
Disclaimer for Forward-Looking Information:
All dollar amounts in this news release are in Canadian dollars. Certain statements in this news release are forward-looking statements, which are statements that are not purely historical, including statements regarding the beliefs, plans, expectations or intentions of VIVO and its management regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the forward-looking statements, including: that the COVID-19 pandemic may last longer and have a more significant impact on the Company's operations, financing abilities, the Canadian cannabis industry, or the global economy generally, than currently expected; and other factors beyond the Company's control. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are urged to consider these factors, and the more extensive risk factors included in the Company's management's discussion and analysis for the three months ended June 30, 2020, which is available on SEDAR, carefully in evaluating the forward-looking statements contained in this news release, and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. The forward-looking statements in this news release are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any such forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.
SOURCE VIVO Cannabis Inc.
VIVO Investor Relations, Michael Bumby, Chief Financial Officer, +1 416-848-9839, [email protected]
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