Wildpack Announces Third Quarter Financial Results

Third Quarter Highlights:

• Gross margin increased by 56% to 19.7% in Q3 over Q2 2021
• Total can volume increased by 36% to 24.8M in Q3 over Q2 2021
• Adjusted EBITDA^* increased by 137% to $436K in Q3 over Q2 2021
• Quality assurance yield increased 35% in Q3 over Q2 2021 
• Completed acquisitions of Craftpac, LLC in Marietta, GA and Vertical Distilling, LLC in Longmont, CO
• Increased annual run rate decorating capacity by 48 million cans
• Progressed construction on the label printing line in the Las Vegas facility, on schedule for pilot production in Q4 2021

*Non IFRS Measure - See "Use of Non-IFRS Measures" section for further information.

VANCOUVER, BC, Nov. 29, 2021 /CNW/ - Wildpack Beverage Inc. (TSXV: CANS) (OTC: WLDPF) ("Wildpack" or the "Company") announces unaudited financial results for the third quarter ending September 30^, 2021. All currencies referenced herein are to US dollars. Wildpack reported in Q3 2021, revenue of $7.069 million, gross profit margin of 19.7%, positive Adjusted EBITDA of approximately $436,000, normalizing expenses of $1.045 million and a net loss of $1.493 million on total can volume of 24.863 million.

Wildpack wholly acquired the outstanding securities of Craftpac, LLC on July 2, 2021 for $1.89 million and Vertical Distilling, LLC on August 20, 2021 for $4.14 million with consideration paid and payable in cash. Both acquisitions have a history of cash flow positive operations and represent key geographic locations with no overlap of the current network of Wildpack's facilities.

Regarding these acquisitions, Thomas Walker, CGO said: "We are very pleased with our acquisitions this quarter. Both companies bring a history of successful operations and positive cash flows. Their integrations are going smoothly and we are excited to continue to expand our geographic reach. We are already seeing interest from our existing customers looking to make use of our expanded footprint."

Gross profit margin improvement was driven by a focus on higher margin work and the implementation of substantially more rigorous quality assurance protocols, which result in higher yields and correspondingly more billable product. These improvements were made on budget and ahead of management's internal key performance milestones.

In the Filling Division, in Las Vegas, the Company continued the commissioning phase with the addition of a second line. Construction and equipment delays were experienced due to COVID-19, however the commissioning phase is now completed with a focus on increasing monthly output. In Baltimore, continued evaluation of the filling expansion was considered, previously described in the Wildpack Beverage Inc. Second Quarter Fiscal 2021 MD&A, management made the decision to invest resources to reduce labour hours and improve efficiencies. Improved carbonation and heat exchange systems led to a 35% increase in yields from quarter two to quarter three.

In the Decorating Division, the Company has completed the addition of a second decorating line in the Baltimore facility and the installation of the first decorating line in the Las Vegas facility. These additions increase total annual decorating capacity by 48 million cans. The Company progressed construction of the label printing line in the Las Vegas facility, remaining on schedule for pilot production in Q4 2021.

Chuck Zadlo, COO commented: "The past quarter represented my first full quarter with Wildpack and I am proud of the work the operations team has done in executing on our excellence based strategy to integrate our new acquisitions as well as improve safety, quality, and productivity in our facilities. A key component in driving our strategy this past quarter began with the expansion of the operations leadership team and the value they have brought from day one has exceeded expectations. Lastly, a big congratulations is in order to Thomas Walker for his dedication to our most recent acquisition of Land and Sea in November 2021."

COVID-19 has caused a global shortage in aluminum can supply as demand increased and supply chains were disrupted. Wildpack was deemed an essential service and has not faced any mandatory shutdowns. In addition, Wildpack has prioritized protocols to ensure that our workers stayed healthy and safe, and many received early access to vaccinations. During this quarter there have been no material production delays due to COVID-19. COVID-19 has had a minor impact on the construction of the second filling line at the Las Vegas facility delaying the project; however, this was completed within the quarter.

This news release should be read in conjunction with the Company's audited consolidated financial statements for the nine-month fiscal period ended December 31, 2020, and interim condensed consolidated financial statements (unaudited) and Management Discussion and Analysis for the three and nine-month periods ended September 30, 2021.

Use of Non-IFRS Measures
Adjusted EBITDA is a non-IFRS earnings measure, therefore it does not have any standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and may not be similar to measures presented by other companies. Adjusted EBITDA represents earnings before interest, income taxes, depreciation, amortization, share-based compensation, professional fees, listing expense, realized and unrealized foreign exchange expense, and directors and officer's compensation. Management uses this measurement to evaluate the operating results of the Company. This measure is also important to management since it is used by the Company's lenders to evaluate the ongoing cash-generating capability of the Company and therefore the amounts those lenders are willing to lend to the Company. Management believes investors may find adjusted EBITDA to be useful information because it provides an alternative measure of the Company's operating performance. As required by Canadian securities laws, we reconcile this non-IFRS measure to the most comparable IFRS measure in our MD&A for Q3 2021.

Per:      "Mitch Barnard"

Mitch Barnard
Chief Executive Officer and Director

Advisors

Stifel GMP is financial advisor to Wildpack Beverage, Inc., Fasken Martineau DuMoulin LLP is its legal advisor.

Visit our investor website at: 

https://investor.wildpackbev.com

About Wildpack

Wildpack is engaged in beverage manufacturing and packaging, operating in the middle market by providing sustainable aluminum can filling and ecofriendly decorating services to brands throughout the United States. Wildpack currently operates indirectly through its wholly owned subsidiaries and out of facilities in Baltimore, Maryland, Atlanta, Georgia, Longmont, Colorado, Sacramento, California and Las Vegas, Nevada with a focus on digital innovation and green ready-to-drink packaging. Wildpack commenced trading on May 19, 2021 on the TSX Venture Exchange under the symbol "CANS.V".

Forward-Looking Statements

This news release may contain "forward-looking statements" within the meaning of applicable Canadian securities laws. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, and contingencies. These statements generally can be identified by the use of forward-looking words such as "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause future results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. Wildpack's statements expressed or implied by these forward-looking statements are subject to a number of risks, uncertainties, and conditions, many of which are outside of Wildpack's control, and undue reliance should not be placed on such statements. Forward-looking statements are qualified in their entirety by the inherent risks and uncertainties related to Wildpack's business, including: that Wildpack's assumptions in making forward-looking statements may prove to be incorrect; adverse market conditions; risks inherent in the beverage manufacturing and packaging sector in general; that future results may vary from historical results; and competition in the markets where Wildpack operates. Except as required by securities law, Wildpack does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise.  

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

SOURCE Wildpack Beverage Inc.

[email protected] or Elijah Clare, VP, Investor Relations, [email protected]