WOLF Grey Wolf Animal Health Corp

TORONTO, April 11, 2024 /CNW/ - Grey Wolf Animal Health Corp. (TSXV: WOLF) ("Grey Wolf" or the "Company"), a Canadian diversified animal health company, today announced financial results for the fourth quarter and year ended December 31, 2023.

• Revenue for the quarter increased year over year by 11.4% to $6.2 million. Revenue increased by 12.3% to $25.4 million for the year.
• Gross profit increased year over year by 9.6% to $3.0 million for the quarter and 10.9% to $12.8 million for the year.
• Adjusted EBITDA¹ remained consistent at $0.7 million for the quarter compared to $0.7 million for the same period in 2022. Adjusted EBITDA¹ for the year was $3.6 million compared to $3.5 million in the prior year, an increase of 4.7%.

"2023 was a successful year for Grey Wolf, our first full year as a public company.  Total revenue grew by 12.3% to $25.4 million driven by organic growth within our expanded product portfolio and gross profits increased by 10.9% compared to the prior year. In addition, Adjusted EBITDA¹ increased by 4.7% or $0.2 million for the year resulting in improved operating income, offset by the cost of operating as a public entity." said Angela Cechetto, Chief Executive Officer. "Additionally, we generated $2.4 million in cash from operations for the year and continued to pay down our debt, ending the year with $7.8 million in cash on hand.  The company remains poised for future growth."

Revenue for the three- and twelve-month period ended December 31, 2023, increased 11.4% to $6.2 million and 12.3% to $25.4 million, respectively, over the same periods in 2022. This increase was due to organic revenue growth in both the Animal Health and Pharmacy business units.

Gross margins for the three- and twelve-month period ended December 31, 2023, decreased slightly to 49.8% compared to 50.6% and 50.5% compared to 51.1%, respectively, over the same periods in 2022. Gross margins were impacted by increased margins in the Pharmacy business unit and slightly reduced margins on the product mix in the Animal Health business unit. 

Total expenses for the three- and twelve-month period ended December 31, 2023, increased 9.6% to $3.2 million and decreased 5.4% to $11.3 million, respectively, over the same periods in 2022. The decrease in total 2023 expenses was largely related to costs associated with the Qualifying Transaction during the same periods in 2022 offset by costs noted below. During the twelve-month period, there was an increase in salary, bonus, and benefits related to operational growth as compared to the same period in 2022. Travel, meals, and business expenses increased in 2023 as the sales and marketing team increased attendance at conventions, trade shows and customer visits. Finally, there was an increase in professional fees and outside services related to corporate costs as the company now operates as a public entity.

Adjusted EBITDA¹ for the three- and twelve-months ended December 31, 2023, was flat at $0.7 million and increased by $0.2 million to $3.6 million, respectively, when compared to the corresponding period in 2022.

Cash and cash equivalents were $7.8 million as at December 31, 2023 compared to $6.9 million at December 31, 2022. The Company generated cash from operations of $2.4 million in 2023 primarily as a result of revenue growth in both the Animal Health and Pharmacy business units. This was offset by the use of $0.1 million of the Company's cash resources from changes in working capital and the repayment of borrowings of $1.0 million. As at December 31, 2023, the Company had outstanding borrowings of $9.2 million, of which $1.1 million are current and $8.1 million are non-current. The Company's debt is a fixed rate term loan with an average interest rate of 4.7% until September 2026. 

Grey Wolf's financial statements and accompanying Management Discussion and Analysis for the three- and twelve-months ended December 31, 2023 are available under the Company's profile on www.sedar.com.

Subsequent to the quarter, the Board of Directors has authorized the grant of an aggregate of 225,000 stock options to purchase common shares of the Company to certain officers, directors and employees of the Company to be effective April 16, 2024 pursuant to the terms of the Company's amended and restated stock option plan. The options will expire 10 years from the grant date, will have an exercise price equal to the closing price per share on April 15, 2024 and will vest as to one third on each of the first, second and third anniversaries of the grant date. The vesting of these options will automatically accelerate upon a change of control.

Management uses both IFRS and Non-IFRS Measures to assess the financial and operating performance of the Company's operations. These Non-IFRS Measures are not recognized measures under IFRS, do not have a standardized meaning under IFRS and are unlikely to be comparable to similar measures presented by other companies. The Non-IFRS Measures referenced in this press release includes Adjusted EBITDA. The Company defines Adjusted EBITDA as earnings before financing and special transaction costs (including, for greater certainty, fees related to the Qualifying Transaction), interest income, interest and accretion expenses, income taxes, depreciation of property and equipment, depreciation of right of use assets, amortization of intangible assets, share-based compensation, change in fair value of embedded derivatives, foreign exchange gains or losses, and other income. The Company considers Adjusted EBITDA as an additional metric in assessing business performance and an important measure of operating performance and cash flow, providing useful information to help analyze and compare profitability between companies for investors and analysts.

The following table provides a summary of the differences between Grey Wolf's consolidated IFRS and Non-IFRS financial measures, which are reconciled below:

EBITDA and Adjusted EBITDA

Grey Wolf Animal Health Corp., headquartered in Toronto, Canada, is a diversified animal health ‎company founded by a veterinarian to bring to market a broad portfolio of products that meets the ‎unmet needs of veterinarians, clinics and pets.  The Company's strategy is to in-license, acquire or develop innovative prescription and non-prescription products for commercialization in the veterinarian channel ‎in Canada. For additional information, please visit: www.greywolfah.com.‎

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 news release.

Forward Looking Statements

Certain information included in this press release contains forward-looking information with the meaning of applicable Canadian securities laws. This information includes statements concerning the Company's objectives, its strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking information generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "would", "expect", "intend", "estimate", "anticipate", "believe", "should", "plan", "continue", or similar expressions suggesting future outcomes or events or the negative thereof. Such forward-looking information reflects management's beliefs and is based on information currently available. All forward-looking information in this press release is qualified by the following cautionary statements.

Forward-looking information necessarily involve known and unknown risks and uncertainties, which may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, assumptions may not be correct and objectives, strategic goals and priorities may not be achieved. A variety of factors, many of which are beyond the Company's control, affect the operations, performance and results of the Company and its subsidiaries, and cause actual results to differ materially from current expectations of estimated or anticipated events or results.

A more detailed assessment of the risks that could cause actual results to materially differ than current expectations is contained in the Risk Factors section of Grey Wolf's Management Discussion and Analysis for the three and twelve months ended December 31, 2023. The forward-looking information included in this press release is made as of the date hereof and should not be relied upon as representing the Company's views as of any date subsequent to the date hereof. Management undertakes no obligation, except as required by applicable law, to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

SOURCE Grey Wolf Animal Health Corp.