-- Improvement in Key Metrics: Revenue Growth, Adj. Gross Profit, Operating Cashflow
-- Execution in Cannabis as Company Pursues Emerging Nutraceuticals Opportunity

TORONTO, Oct. 29, 2021 (GLOBE NEWSWIRE) -- Lifeist Wellness Inc. ("Lifeist" or the "Company") (TSXV: LFST) (FRANKFURT: M5B) (OTCMKTS: NXTTF), a wellness company that leverages advancements in science and technology to enable you to find your path to wellness, today reported its financial results for the three and nine months ended August 31, 2021. All financial figures are in Canadian dollars unless otherwise indicated.

Third Quarter 2021 Financial Highlights

• Gross revenue increased 12% year-over-year to $7.1 million, led by cannabis growth of 34%.
• Gross profit and margin more than doubled year-over-year to $0.9 million and 15% of Net revenue (23% before inventory adjustment), the fourth consecutive quarterly improvement.
• EBITDA loss narrowed to $5.4 million compared to $7.3 million in Q3 2020 and $5.9 million in Q2 2021, even with incremental investments into emerging businesses including nutraceuticals.
• Net cash used in operating activities decreased from $5.7 million in Q2 2021 to $4.9 million in Q3 2021.
• Inventory management continues to improve with reduced turnover days and lower holdings of inventory.
• Working capital position of $19.5 million at quarter end remains strong.

"Our improved third quarter results reflect ongoing positive trends: higher revenue, lower costs, and better cash flow," said Meni Morim, CEO of Lifeist. "We are seeing the early payoff from our focus on where we can deliver more profitable growth, operate more efficiently, and optimize working capital within our current portfolio of businesses while we invest in the future. We are pressing forward with our plans to develop nutraceuticals products with a new business unit launching this quarter, enabling Lifeist to transition to sustainable profitability. The improved performance in our cannabis business while we invest in this emerging opportunity reinforces our confidence in our strategy and we expect continued top-line growth and improvements in profitability as we navigate through this transformation. Overall, there has been a significant amount of work done across the Company laying the foundations for growth as we continue our company's evolution to wellness."

Added Mr. Morim, "In particular, the financial turnaround is being led by our cannabis subsidiary, CannMart, Inc., which is experiencing strong demand for its portfolio of products from consumers, retailers and provincial wholesalers across Canada as evidenced by the 34% growth in cannabis revenue in the quarter. What makes CannMart unique is its ability to bring brands to market quickly, whether it be via the increasing number of master distribution agreements that we are signing where we act as the middleman, or via the expansion of our product portfolio with the launch of our limited-edition SKUs made at our subsidiary CannMart Labs's state-of-the-art BHO extraction facility."

Operational Highlights

• CannMart Inc. continues to enter into partnerships with third parties to be their wholesale and logistics partner in order to take advantage of the trend where Canadian licensed producers (LPs) and manufacturers are looking to outsource parts of their operations that are not core. During the third quarter, CannMart Inc. signed Master Distribution Agreements with several companies including with Rapid Dose Therapeutics Corp. ("RDT") (CSE: DOSE) to exclusively distribute RDT's innovative RDT branded products across Canada.
• CannMart Inc. received its first purchase orders from the provinces of Manitoba, and Saskatchewan for its 2.0 consumer-focused recreational house brand "Roilty" concentrates.
• As part of its focus on the broader wellness space, the Company changed its corporate name from Namaste Technologies Inc. to Lifeist Wellness Inc. effective September 9, 2021, and changed its stock ticker symbol on the TSXV to its current symbol "LFST".
• Lifeist continues to look for ways to operate more efficiently, including subleasing its former Toronto office headquarters which is expected to generate annual run rate savings of approximately $138,000 until expiry of its lease in October 2024, as well as consolidating headcount, software and marketing costs across divisions in order to reduce costs and reallocate resources more efficiently across the Company, and implementing inventory control measures on the cannabis business to reduce carrying costs.

Financial Summary of Q3 2021 and Comparative Periods

Gross revenue increased 12% to $7.1 million in Q3 2021, as compared to $6.3 million in Q3 2020. This growth was driven by the Company's cannabis business which increased 34% due to increased volume of orders from provincial customers, enhanced product selection and a new dropship revenue stream added in Q3 2021. In addition, SaaS revenue increased 9% as compared to Q3 2020.

Adjusted gross margin, before inventory write-down, was 23% of Net revenue in Q3 2021 compared to 10% in Q3 2020 and 14% in Q2 2021. The 1,300-basis point improvement year-over-year was due to improved production efficiencies across all segments.

EBITDA loss narrowed to $5.4 million in Q3 2021 compared to $7.3 million in Q3 2020, due to improved performance across most business units. The reduced EBITDA loss was net of approximately $1 million of investments in emerging businesses including CannMart Labs and nutraceuticals.

Net loss in Q3 2021 was $6.1 million, largely impacted by increased Salaries and Selling and Marketing costs, as a result of a strategic investment in the growth of core business segments as well as an upfront investment in the nutraceutical segment.

Balance Sheet and Cash Flow

Cash and cash equivalents were $17.9 million as of August 31, 2021, compared to $23.0 million as of May 31, 2021, which is sufficient to fund planned growth initiatives.

Demonstrating continued improved inventory management practices, inventories decreased to $4.9 million compared to $5.2 million in Q2 2021 and $6.0 million in Q1 2021.

Net cash used in operations was $4.9 million for the quarter. This is the third consecutive quarter in which the Company demonstrated EBITDA loss improvements.

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/6542334e-7ea0-427f-8ea9-a73412adcc5d

Additional Information

Financial results and analysis are available on Lifeist's website (www.lifeist.com) and SEDAR (www.sedar.com).

About Lifeist Wellness Inc.

Lifeist is at the forefront of the post-pandemic wellness revolution requiring smart solutions. Lifeist is a portfolio wellness company leveraging advancements in science and technology to enable you to find your path to wellness. Portfolio business units include: CannMart.com that provides Canadian medical customers with a diverse selection of cannabis products from a multitude of federally licensed cultivators and its U.S. customers with access to hemp-derived CBD and smoking accessories; and CannMart's Canadian recreational cannabis distribution business facilitating recreational sales to a number of provincial government control boards. The Company is set to launch a new nutraceuticals division in the fourth quarter with disruptive products in wellness. For more information, visit www.lifeist.com, Cannmart.com and everyonedoesit.co.uk.

Contacts

Lifeist Wellness Inc.
Meni Morim, CEO
Matt Chesler, CFA, Investor Relations
Ph: 647-362-0390
Email: ir@lifeist.com

Non-IFRS Financial Measures

Management evaluates the Company's performance using a variety of measures, including "Net loss before income tax, depreciation and amortization" and "Adjusted EBITDA". The non-IFRS measures discussed below should not be considered as an alternative to or to be more meaningful than revenue or net loss. These measures do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.

The Company believes these non-IFRS financial measures provide useful information to both management and investors in measuring the financial performance and financial condition of the Company.

Management uses these and other non-IFRS financial measures to exclude the impact of certain expenses and income that must be recognized under IFRS when analyzing consolidated underlying operating performance, as the excluded items are not necessarily reflective of the Company's underlying operating performance and make comparisons of underlying financial performance between periods difficult. From time to time, the Company may exclude additional items if it believes doing so would result in a more effective analysis of underlying operating performance. The exclusion of certain items does not imply that they are non-recurring.

(i) Current and deferred income taxes, depreciation and amortization, and share-based compensation were excluded from the Adjusted EBITDA calculation as they do not represent cash expenditures.
(ii) Other income consisting of gain on disposal of subsidiary, interest income, realized gain on disposition of AFS investments, unrealized gain on derivatives and other miscellaneous non-recurring income were excluded from Adjusted EBITDA calculation.
(iii) Non-recurring costs related to restructuring and legacy issues were excluded from Adjusted EBITDA calculation.
(iv) Impairment loss relating to goodwill, customer list, domains and brand names were excluded from Adjusted EBITDA calculation.
(v) Impairment loss relating to receivable is a provision for expected credit loss to an associate and was excluded from Adjusted EBITDA calculation.
(vi) Share of associates loss, net of tax, is excluded due to lack of control.

Forward-Looking Information

This news release contains "forward-looking information" within the meaning of applicable securities laws. All statements contained herein that are not historical in nature contain forward-looking information. Forward-looking information can be identified by words or phrases such as "may", "expect", "likely", "should", "would", "plan", "anticipate", "intend", "potential", "proposed", "estimate", "believe" or the negative of these terms, or other similar words, expressions and grammatical variations thereof, or statements that certain events or conditions "may" or "will" happen.

The forward-looking information contained herein, including the Company's continued evolution into a wellness company, the anticipated launch of a nutraceutical division in the fourth quarter of 2021 and certain actions the Company expects to take to operate more efficiently are only predictions and are made as of the date of this news release. Various assumptions were used in developing the forward-looking information throughout this news release which management believed to be reasonable at the time such statements were made, including expectations that the introduction of a new nutraceutical division, products and brands will generate additional revenue, management's perceptions of Lifeist's standing in the online marketplace for wellness, cannabis and related products and accessories, Lifeist's beliefs regarding the expected demand for wellness, cannabis and related products and accessories and the expected growth of that market, results of operations, operational matters, historical trends, current conditions and expected future developments, as well as other considerations that are believed to be appropriate in the circumstances. While we consider these assumptions to be reasonable based on information currently available to management, there is no assurance that such expectations will prove to be correct. By its nature, forward-looking information is subject to inherent risks and uncertainties that 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, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. A variety of factors, including known and unknown risks, many of which are beyond our control, could cause actual results to differ materially from the forward-looking information in this press release. Such factors include, without limitation: unforeseen developments that would delay the Company's ability to launch its nutraceutical division as anticipated an in a timely manner, risks relating to the Company's ability to develop and execute its business strategy and to implement its various cost cutting measures as anticipated and in a timely manner and the benefits realizable therefrom, risks specifically related to the Company's operations, and risks relating to the Company's ability to successfully operate everywhere in a virtual environment. Additional risk factors can also be found in the Company's current MD&A and annual information form, both of which have been filed under the Company's SEDAR profile at www.sedar.com. Readers are cautioned not to put undue reliance on forward-looking information. The Company undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

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 release or has in any way approved or disapproved of the contents of this press release.

Source: Lifeist Wellness Inc.