Zenabis Global Inc (OTCMKTS:ZBISF) reported a growth of 61.18% YoY to CAD 21.486 million in Q4 2020. Its margins are 41.8% of the revenues in 2020.
Lowers cash burn
The full-year revenues of Zenabis are CAD 75.039 million (up 105.97% YoY).
The cash burn of Zenabis declined to CAD 17.5 million in 2020.
CEO of Zenabis, Shai Altman, said the company successfully navigated the second year of operation with a strong balance sheet and impressive growth in revenues. The company reported annual growth of 105.97% in all sales channels.
Zenabis posted a growth of 78% in recreational cannabis sales in Canada. The company improved its market share to 1.7% from 1.0%.
Zenabis reported a robust growth of 242% YoY in the wholesale bulk channel mainly because it entered into overseas markets like Australia and Israel in 2020.
Zenabis achieved a reduction of 51% in operational expenses in 2020 because of an improved focus on operational efficiencies and cost-saving measures.
The company divested its non-core assets like Zenabis Delta facility and Bevo Farms Ltd to strengthen its balance sheet in 2020. It also lowered its borrowing and loans to CAD 65.7 million and CAD 88.2 million.
Developments in Q1 2021
Zenabis applied to the Supreme Court of British Columbia in February 2021 to identify the amount to pay back and terminate the SD (Senior Debt).
Enters a merger deal with Hexo Corp
Zenabis entered a merger deal with Hexo Corp in February 2021. As per the terms of the pact, Hexo will purchase all of the shares of Zenabis for CAD 235 million. The investors of Zenabis will earn 0.01772 common shares of Hexo for each of their shares.
The deal received the nod of the board of directors of Hexo and Zenabis. Voting of shareholders for this deal will be held in May 2021.
As per the at-the-market equity program, Zenabis can issue shares worth CAD 15 million to the general public from its treasury. The company raised a capital of CAD 6.304 million by issuing 36.956 million common shares from its treasury after December 2020.
Zenabis Ltd, a subsidiary of Zenabis Global, entered a settlement accord and release with a client. As per this deal, both parties agreed to end the arbitration proceedings.