Positive 1ST Quarter EBITDA of $124,221 and 178% Growth in Gross Margin
Updated: Apr 18, 2022
Pervasip today announced the filing of its unaudited financial statements for its 1st Quarter ended February 28, 2022, showing positive EBITDA and material improvement to Gross Margin
“Our team has executed the first half of our restructuring plans flawlessly over the past few months and improved gross margins, achieving positive EBITDA and quarter over quarter revenue growth" German Burtscher, CEO & President
SEATTLE, WASHINGTON, APRIL 18, 2022
Pervasip Corp. (OTCPK: PVSP) (“Pervasip” or the “Company”), a developer of companies and technologies in high value emerging markets, today announced the filing of its unaudited financial statements for its 1st Quarter ended February 28, 2022.
As outlined in the 2022 shareholder letter, Pervasip launched a system wide restructuring after hiring new CEO & President German Burtscher and CFO George Jordan in Q4 2021. Adjusted for a onetime expense recognition of $176,246 in annualized severance payments, and $270,571 in depreciation EBITDA for Q1 equals $124,221 with 39% in Gross Margins. This marks a material improvement compared to the period ended February 28, 2021, which equaled ($649,831) in EBITDA and 23% in gross margins.
Net loss attributable to Pervasip Corp for the period ended February 28, 2022 decreased to $(103,788) from $(582,882) for the period ended February 28, 2021, and includes onetime termination expense charges of $176,246 or an adjusted positive net income of $72,458.
While December through February are traditionally the slowest quarter of the year in Cannabis, and on the heels of an industry wide post pandemic contraction, Pervasip is reporting 2.4% growth in revenue over last year’s comparative First Quarter, markedly improved gross margins and positive EBITDA.
“Our team has executed the first half of our restructuring plans flawlessly over the past few months. Improved gross margins, achieving positive EBITDA and quarter over quarter revenue growth even in the traditionally slowest quarter in our industry and compared to a pandemic high Q1 2021 is a testament to our strength, the direction of the Company and the power of the Artizen brand” says CEO German Burtscher. “Our infrastructure is on track to achieve per square foot target objectives for harvest yields by Q4 this year, which will yield a 50% increase in output from all gardens. Together with the buildout of our new state of the art cultivation facility, this will continue to improve the company’s revenue and profitability.”
The Company partnered with a national cultivation group in its effort to upgrade all facilities and grow SOPs with an objective to increase per square foot output by 50%
Washington’s largest public utility agreed to provide energy rebates to upgrade grow lighting to state of the art LED equipment with close to one million dollars ($1 million) in rebates over the next 12 months
Quarter over quarter EBIDTA has increased from ($649,831) to $124,221
Revenue increased by 2.4% in a post pandemic market that saw revenues decrease by 12% in Washington State
Inventories have increased to $4,321,512 and provide the power to support revenue growth for Q2, while allowing gardens to continue to increase per square foot yields in anticipation of continuing strong growth in Q3 and Q4
A six-month upgrade to the Port Townsend greenhouse cluster was completed end of February and positive yield and quality improvement results will start to be recognized in the second quarter
The company wide restructuring that started in October 2021 was completed by end of February resulting in over a million dollars in operating expenses saved with positive cashflow impacts to be realized in the third and fourth quarter this year
“While focused on structuring our business for success and improved efficiencies, our team has also done incredible work advancing our plans with KRTL Biotech for brand expansion into adjacent wellness markets, developing a new cannabis brand, and expanding the Artizen brand’s network of retail customers. We have moved the entire organization off proprietary software systems and moved to off-the-shelf, third party supported applications, launched system-wide upgrades to our facilities, which are already yielding results in the form of increased flower quality and yield, and all this in less than 5 months.”
Burtscher continued: “Based on requests from many of our shareholders we are also going to make virtual visits available for all the gardens and operations growing Artizen branded flower. It is sometimes difficult to understand the size of operation required to sustain a business like ours and difficult to visualize what we are doing. Look for an announcement on our website in the coming days. We also will gladly host anyone visiting us in Washington for a tour!”
Pervasip Corporation Pervasip Corp., a developer of companies and technologies in high value emerging markets, owns Artizen Corporation and its subsidiary, Zen Asset Management LLC, a diversified asset management company founded to acquire, develop, and support companies and technologies in the cannabis industry. ZAM’s existing clients operate four licensed cannabis cultivation and one processing facility in Washington. Most of the biomass produced by these independent cultivators has been sold historically under the Artizen™ brand, including all-time top selling products in flower in Washington state. Additional information on Artizen-branded products is available online at www.artizencannabis.com. Pervasip additionally owns 5% of KRTL Biotech, Inc., a developer of biotechnologies with a focus on pharmaceutical applications of cannabinol and psilocybin. Additional information on KRTL is available online at www.krtlbiotech.com. Additional information on Pervasip can be found at www.pervasip.net.
This news release contains statements and information that, to the extent that they are not historical fact, may constitute “forward-looking information” within the meaning of applicable securities legislation. Forward-looking information may include financial and other projections, as well as statements regarding future plans, objectives, or economic performance, or the assumption underlying any of the foregoing. In some cases, forward-looking statements can be identified by terms such as may, would, could, will, likely, except, anticipate, believe, intend, plan, forecast, project, estimate, outlook, or the negative thereof or other similar expressions concerning matters that are not historical facts. Examples of such statements include, but are not limited to, statements with respect to the objectives and business plans of the Company; ability to realize benefits from its recent corporate appointments; ability to retain its key personnel; the intention to grow the Company’s business and operations; the competitive conditions of the industries in which the Company operates; and laws and any amendments thereto applicable to the Company. Forward-looking information is based on the assumptions, estimates, analysis and opinions of management made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances at the date that such statements are made, but which may prove to be incorrect. The material factors and assumptions used to develop the forward-looking information contained in this news release include, but are not limited to, key personnel and qualified employees continuing their involvement with the Company; and the Company’s ability to secure financing on reasonable terms. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking information, including, without limitation, risks relating to the future business plans of the Company; risks that the Company will not be able to retain its key personnel; risks that the Company will not be able to secure financing on reasonable terms or at all, as well as all of the other risks as described in the Company’s periodic disclosure statements. Accordingly, readers should not place undue reliance on any such forward-looking information. Further, any forward-looking information speaks only as of the date on which such statement is made. New factors emerge from time to time, and it is not possible for the Company’s management to predict all of such factors and to assess in advance the impact of each such factor on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking information. The Company does not undertake any obligation to update any forward-looking information to reflect information or events after the date on which it is made or to reflect the occurrence of unanticipated events, except as required by law, including securities laws.
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