Cover
Cover - shares | 6 Months Ended | |
Jul. 30, 2022 | Sep. 09, 2022 | |
Cover [Abstract] | ||
Entity Registrant Name | DAVIDsTEA Inc. | |
Entity Central Index Key | 0001627606 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-29 | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Jul. 30, 2022 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2023 | |
Entity Common Stock Shares Outstanding | 26,561,744 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-37404 | |
Entity Incorporation State Country Code | Z4 | |
Entity Tax Identification Number | 98-1048842 | |
Entity Address Address Line 1 | 5430 Ferrier | |
Entity Address Address Line 2 | Mount-Royal | |
Entity Address City Or Town | Québec | |
Entity Address Country | CA | |
Entity Address Postal Zip Code | H4P 1M2 | |
City Area Code | 888 | |
Local Phone Number | 873-0006 | |
Security 12b Title | Common shares, no par value per share | |
Security Exchange Name | NASDAQ | |
Trading Symbol | DTEA | |
Entity Interactive Data Current | Yes |
INTERIM CONSOLIDATED BALANCE SH
INTERIM CONSOLIDATED BALANCE SHEETS - CAD ($) $ in Thousands | Jul. 30, 2022 | Jan. 29, 2022 |
Current | ||
Cash | $ 19,048 | $ 25,107 |
Accounts and other receivables | 2,497 | 3,209 |
Inventories | 30,234 | 31,048 |
Prepaid expenses and deposits | 5,172 | 4,142 |
Total current assets | 56,951 | 63,506 |
Property and equipment | 739 | 775 |
Intangible assets | 1,957 | 2,234 |
Right-of-use assets | 10,829 | 12,087 |
Total assets | 70,476 | 78,602 |
Current | ||
Trade and other payables | 11,701 | 12,300 |
Deferred revenue | 5,430 | 5,434 |
Current portion of lease liabilities | 2,484 | 2,364 |
Total current liabilities | 19,615 | 20,098 |
Non-current portion of lease liabilities | 8,945 | 10,189 |
Total liabilities | 28,560 | 30,287 |
Equity | ||
Share capital | 113,862 | 113,534 |
Contributed surplus | 2,545 | 2,507 |
Deficit | (77,466) | (70,671) |
Accumulated other comprehensive income | 2,975 | 2,945 |
Total equity | 41,916 | 48,315 |
Total liabilities and equity | $ 70,476 | $ 78,602 |
INTERIM CONSOLIDATED STATEMENTS
INTERIM CONSOLIDATED STATEMENTS OF NET (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME (Unaudited) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
INTERIM CONSOLIDATED STATEMENTS OF NET (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME (Unaudited) | ||||
Sales | $ 15,225 | $ 18,743 | $ 35,660 | $ 41,992 |
Cost of sales | 8,751 | 10,748 | 20,222 | 23,229 |
Gross profit | 6,474 | 7,995 | 15,438 | 18,763 |
Selling, general and administration expenses | 11,219 | 9,085 | 22,025 | 18,279 |
Restructuring plan activities, net | (75,557) | (77,159) | ||
Results from operating activities | (4,745) | 74,467 | (6,587) | 77,643 |
Finance costs | 167 | 23 | 338 | 33 |
Finance income | (77) | (34) | (116) | (89) |
Net income (loss) before income taxes | (4,835) | 74,478 | (6,809) | 77,699 |
Recovery of income taxes | (1,000) | (1,000) | ||
Net (loss) income | (4,835) | 75,478 | (6,809) | 78,699 |
Other comprehensive income: | ||||
Cumulative translation adjustment | 12 | 200 | 30 | 1,012 |
Other comprehensive income, net of tax | 12 | 200 | 30 | 1,012 |
Total comprehensive (loss) income | $ (4,823) | $ 75,678 | $ (6,779) | $ 79,711 |
Net (loss) earnings per share: | ||||
Basic | $ (0.18) | $ 2.87 | $ (0.26) | $ 3 |
Fully diluted | $ (0.18) | $ 2.75 | $ (0.26) | $ 2.87 |
Weighted average number of shares outstanding: | ||||
Basic | 26,487,933 | 26,299,094 | 26,456,830 | 26,270,284 |
Fully diluted | 26,487,933 | 27,455,005 | 26,456,830 | 27,422,066 |
INTERIM CONSOLIDATED STATEMEN_2
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
OPERATING ACTIVITIES | ||||
Net (loss) income | $ (4,835) | $ 75,478 | $ (6,809) | $ 78,699 |
Items not affecting cash: | ||||
Depreciation of property and equipment | 88 | 407 | 164 | 795 |
Amortization of intangible assets | 137 | 484 | 277 | 887 |
Amortization of right-of-use assets | 669 | 135 | 1,319 | 294 |
Gain on liabilities subject to compromise, including the recovery of income taxes | 0 | (77,713) | 0 | (79,861) |
Interest on lease liabilities | 167 | 23 | 334 | 33 |
Stock-based compensation expense | 398 | 363 | 708 | 545 |
Sub-total | (3,376) | (823) | (4,007) | 1,392 |
Net change in non-cash working capital balances related to operations | 641 | (18,256) | (406) | (19,164) |
Cash flows used in operating activities | (2,735) | (19,079) | (4,413) | (17,772) |
FINANCING ACTIVITIES | ||||
Payment of lease liabilities including interest | (769) | (139) | (1,518) | (322) |
Cash flows used in financing activities | (769) | (139) | (1,518) | (322) |
INVESTING ACTIVITIES | ||||
Additions to property and equipment | (128) | (52) | (128) | (52) |
Cash flows used in investing activities | (128) | (52) | (128) | (52) |
Decrease in cash during the period | (3,632) | (19,270) | (6,059) | (18,146) |
Cash, beginning of the period | 22,680 | 31,321 | 25,107 | 30,197 |
Cash, end of the period | 19,048 | 12,051 | 19,048 | 12,051 |
Cash paid for: | ||||
Interest | 0 | 0 | 0 | 0 |
Income taxes (classified as operating activity) | 0 | 0 | 0 | 0 |
Cash received for: | ||||
Interest1 | 43 | 39 | 77 | 94 |
Income taxes (classified as operating activity)1 | $ 0 | $ 0 | $ 0 | $ 0 |
INTERIM CONSOLIDATED STATEMEN_3
INTERIM CONSOLIDATED STATEMENTS OF EQUITY (Deficiency) (Unaudited) - CAD ($) $ in Thousands | Total | Contributed Surplus [Member] | Retained Earnings (Accumulated Deficit) | Accumulated other comprehensive loss | Share Capital [Member] |
Balance, amount at Jan. 30, 2021 | $ (31,291) | $ 1,747 | $ (148,068) | $ 1,863 | $ 113,167 |
Statement [Line Items] | |||||
Net income for the six months ended July 31, 2021 | 78,699 | 0 | 78,699 | 0 | 0 |
Other comprehensive income | 1,012 | 0 | 0 | 1,012 | 0 |
Total comprehensive income | 79,711 | 0 | 78,699 | 1,012 | 0 |
Common shares issued on vesting of restricted stock units | (740) | (486) | (493) | 0 | 239 |
Stock-based compensation expense | 545 | 545 | 0 | 0 | 0 |
Balance, amount at Jul. 31, 2021 | 48,225 | 1,806 | (69,862) | 2,875 | 113,406 |
Balance, amount at Jan. 29, 2022 | 48,315 | 2,507 | (70,671) | 2,945 | 113,534 |
Statement [Line Items] | |||||
Other comprehensive income | 30 | 0 | 0 | 30 | 0 |
Total comprehensive income | (6,779) | 0 | (6,809) | 30 | 0 |
Common shares issued on vesting of restricted stock units | (328) | (670) | 14 | 0 | 328 |
Stock-based compensation expense | 708 | 708 | 0 | 0 | 0 |
Net loss for the six months ended July 30, 2022 | (6,809) | 0 | (6,809) | 0 | 0 |
Balance, amount at Jul. 30, 2022 | $ 41,916 | $ 2,545 | $ (77,466) | $ 2,975 | $ 113,862 |
CORPORATE INFORMATION
CORPORATE INFORMATION | 6 Months Ended |
Jul. 30, 2022 | |
CORPORATE INFORMATION | 1. CORPORATE INFORMATION The unaudited condensed interim consolidated financial statements of DAVIDsTEA Inc. and its subsidiary, DAVIDsTEA (USA) Inc., (collectively, the “Company”) for the three and six-month periods ended July 30, 2022 and July 31, 2021 were authorized for issue by the Board of Directors on September 9, 2022. The Company is incorporated and domiciled in Canada and its shares are publicly traded on the Nasdaq Global Market under the symbol “DTEA”. The registered office is located at 5430 Ferrier St., Town of Mount-Royal, Québec, Canada, H4P 1M2. The Company offers a specialty branded selection of high-quality proprietary loose-leaf teas, pre-packaged teas, tea sachets, tea-related accessories and gifts through its e-commerce platform at www.davidstea.com and the Amazon Marketplace, its wholesale customers which include over 3,800 grocery stores and pharmacies, and 18 Company-owned stores across Canada. The Company offers primarily proprietary tea blends that are exclusive to the Company, as well as traditional single-origin teas and herbs. Our passion for and knowledge of tea permeates our culture and is rooted in an excitement to explore the taste, health and lifestyle elements of tea. With a focus on innovative flavours, wellness-driven ingredients and organic tea, the Company launches seasonally driven “collections” with a mission of making tea fun and accessible to all. Sales fluctuate from quarter to quarter. Sales are traditionally highest in the fourth fiscal quarter due to the year-end holiday season and tend to be lowest in the second and third fiscal quarters because of lower customer engagement during the summer months. |
BASIS OF PREPARATION
BASIS OF PREPARATION | 6 Months Ended |
Jul. 30, 2022 | |
BASIS OF PREPARATION | 2. BASIS OF PREPARATION These unaudited condensed interim consolidated financial statements have been prepared in accordance with IAS 34, “Interim Financial Reporting” as issued by the International Accounting Standards Board (“IASB”). Accordingly, these financial statements do not include all the financial statement disclosures required for annual financial statements and should be read in conjunction with the Company’s audited consolidated financial statements for the year ended January 29, 2022, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the IASB. In management’s opinion, the unaudited condensed interim consolidated financial statements reflect all the adjustments that are necessary for a fair presentation of the results for the interim period presented. These unaudited condensed interim consolidated financial statements have been prepared using the accounting policies and methods of computation as outlined in Note 3 of the consolidated financial statements for the year ended January 29, 2022. |
SIGNIFICANT ACCOUNTING JUDGEMEN
SIGNIFICANT ACCOUNTING JUDGEMENTS ESTIMATES AND ASSUMPTIONS | 6 Months Ended |
Jul. 30, 2022 | |
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS | 3. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS The preparation of condensed interim consolidated financial statements requires management to make estimates and assumptions using judgment that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense during the reporting period. Estimates and other judgments are continually evaluated and are based on management’s experience and other factors, including expectations about future events that are believed to be reasonable under the circumstances. Actual results may differ from those estimates. In preparing these unaudited condensed interim consolidated financial statements, critical judgments made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty were the same as those referred to in Note 5 of the consolidated financial statements for the year ended January 29, 2022. |
SHARE CAPITAL
SHARE CAPITAL | 6 Months Ended |
Jul. 30, 2022 | |
SHARE CAPITAL | 4. SHARE CAPITAL Authorized An unlimited number of common shares. Issued and outstanding July 30, January 29, 2022 2022 $ $ Share Capital - (26,561,744) Common shares (January 29, 2022 - 26,423,717) 113,862 113,534 During the three and six-month periods ended July 30, 2022, 134,452 and 138,027 common shares, respectively, (July 31, 2021 – 104,200 and 125,387 common shares, respectively), were issued in relation to the vesting of restricted stock units (“RSU”), resulting in an increase in share capital of $322 and $328, net of tax (July 31, 2021 – $70 and $239, net of tax respectively) and a reduction in contributed surplus of $658 and $670 respectively (July 31, 2021 – $142 and $486, respectively). Stock-based compensation As at July 30, 2022, 694,412 (July 31, 2021, 937,868) common shares remain available for issuance under the 2015 Omnibus Plan. No stock options were granted during the three and six-month periods ended July 30, 2022 and July 31, 2021. A summary of the status of the Company’s stock option plan during the six-month periods is presented below. For the six-months ended July 30, July 31, 2022 2021 Weighted Weighted average average Options exercise Options exercise outstanding price outstanding price # $ # $ Outstanding and exercisable - beginning and end of period 3,490 14.39 17,490 6.32 A summary of the status of the Company’s RSU plan and changes during the six-month periods are presented below. For the six-months ended July 30, July 31, 2022 2021 Weighted Weighted average average RSUs fair value RSUs fair value outstanding per unit (1) outstanding per unit (1) # $ # $ Outstanding, beginning of period 1,282,790 2.60 1,306,101 1.70 Granted 511,264 2.66 425,764 4.64 Forfeitures (27,466 ) 2.28 (32,747 ) 1.50 Vested (138,027 ) 2.38 (125,387 ) 1.91 Vested, withheld for tax (143,711 ) 2.38 (130,562 ) 1.91 Outstanding, end of period 1,484,850 2.67 1,443,169 2.53 _____________ (1) Weighted average fair value per unit as at date of grant. During the three and six-month periods ended July 30, 2022, the Company recognized a stock-based compensation expense of $398 and $708, respectively (July 31, 2021 – $363 and $545, respectively). |
SELLING GENERAL AND ADMINISTRAT
SELLING GENERAL AND ADMINISTRATION EXPENSES | 6 Months Ended |
Jul. 30, 2022 | |
SELLING, GENERAL AND ADMINISTRATION EXPENSES | 5. SELLING, GENERAL AND ADMINISTRATION EXPENSES The Company qualified in Fiscal 2021 for the Canada Emergency Wage Subsidy and the Canada Emergency Rent Subsidy under the COVID-19 Economic Response Plan of the Government of Canada. During the three and six-month periods ended July 30, 2022, the Company recognized payroll and rent subsidies of $nil (July 31, 2021 – $2.5 million and $3.6 million, respectively). For the three-months ended For the six-months ended July 30, July 31, July 30, July 31, 2022 2021 2022 2021 $ $ $ $ Wages, salaries and employee benefits 3,542 3,447 6,950 6,824 Marketing expenses 1,609 1,692 3,906 2,896 IT ongoing expenses 1,326 1,173 2,735 2,487 Software implementation and configuration costs 1,325 1,592 2,080 2,454 Credit card fees 275 443 677 979 Director & officer and other insurance 343 305 690 565 Professional and consulting fees 764 790 1,159 1,255 Depreciation of property and equipment 88 407 164 795 Amortization of intangible assets 137 484 277 887 Amortization right-of-use asset 669 135 1,319 294 Stock-based compensation 398 363 708 545 Other selling, general and administration 743 786 1,360 1,894 Sub-total 11,219 11,617 22,025 21,875 Government emergency wage and rent subsidy — (2,532 ) — (3,596 ) 11,219 9,085 22,025 18,279 |
RESTRUCTURING PLAN ACTIVITIES N
RESTRUCTURING PLAN ACTIVITIES NET | 6 Months Ended |
Jul. 30, 2022 | |
RESTRUCTURING PLAN ACTIVITIES, NET | 6. RESTRUCTURING PLAN ACTIVITIES, NET On July 8, 2020, the Company announced that it was implementing a restructuring plan (the “Restructuring Plan”) under the Companies’ Creditors Arrangement Act (Canada) (the “CCAA”) in order to accelerate its transition to predominantly an online retailer and wholesaler of high-quality tea and accessories. At a creditors’ meeting held on June 11, 2021, the Company’s Plan of Arrangement was approved by the requisite majorities of creditors of the Company. As a result, the Company was required and paid approximately $17.6 million to its creditors in full and final settlement in the second quarter of Fiscal 2021. During the three-and six-month periods ended July 31, 2021, the Company recorded a net gain on the settlement of liabilities subject to compromise of $75,557 and $77,159, respectively net of professional fees in connection with the CCAA proceedings of $1,156 and $1,702, respectively and before a gain from the recovery of income taxes of $1,000 for both periods. This net gain is presented in the interim consolidated statement of income (loss) and comprehensive income (loss) in Restructuring Plan activities, net and Recovery of income taxes. |
NET (LOSS) EARNINGS PER SHARE
NET (LOSS) EARNINGS PER SHARE | 6 Months Ended |
Jul. 30, 2022 | |
NET (LOSS) EARNINGS PER SHARE | 7. NET (LOSS) EARNINGS PER SHARE Basic Net (loss) earnings per share (“EPS”) amounts are calculated by dividing the Net (loss) income for the period attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the period. Diluted EPS amounts are calculated by dividing the Net (loss) income attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares, unless these would be anti‑dilutive. The following reflects the Net (loss) income and share data used in the basic and diluted EPS computations: For the three-months ended For the six-months ended July 30, July 31, July 30, July 31, 2022 2021 2022 2021 $ $ $ $ Net (loss) income for basic EPS (4,835 ) 75,478 (6,809 ) 78,699 Weighted average number of shares outstanding: Basic 26,487,933 26,299,094 26,456,830 26,270,284 Fully diluted 26,487,933 27,455,005 26,456,830 27,422,066 Net (loss) earnings per share: Basic (0.18 ) 2.87 (0.26 ) 3.00 Fully diluted (0.18 ) 2.75 (0.26 ) 2.87 |
RELATED PARTY DISCLOSURES
RELATED PARTY DISCLOSURES | 6 Months Ended |
Jul. 30, 2022 | |
RELATED PARTY DISCLOSURE | 8. RELATED PARTY DISCLOSURES Transactions with related parties are measured at the exchange amount, being the consideration established and agreed to by the related parties. During the three and six-month periods ended July 30, 2022, the Company purchased merchandise for resale amounting to $44 and $44, respectively (July 31, 2021 – $153 and $199, respectively) and provided infrastructure and administrative services of $5 and $10, respectively (July 31, 2021 – $5 and $10, respectively) to a company controlled by one of its executive employees. As of July 30, 2022, an amount of $2 was outstanding and presented in Accounts and other receivables. As of July 30, 2022, an amount of $44 was outstanding and presented in Trade and other payables. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jul. 30, 2022 | |
SEGMENT INFORMATION | 9. SEGMENT INFORMATION An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses. The Company has two operating segments, Canada, and the U.S., that derive their revenues from various distribution channels including online, retail and wholesale. The Company’s Chief Executive and Brand Officer and President, Chief Financial and Operations Officer (the chief operating decision makers or “CODM”) make decisions about resources to be allocated to the segments and assesses performance, and for which discrete financial information is available. The Company derives revenue from the following products: For the three-months ended For the six-months ended July 30, July 31, July 30, July 31, 2022 2021 2022 2021 $ $ $ $ Tea 13,266 16,117 31,241 36,586 Tea accessories 1,484 2,626 3,583 5,406 Food and beverages 475 — 836 — 15,225 18,743 35,660 41,992 All property and equipment, right-of-used assets and intangible assets are located in Canada. Results from operating activities before corporate expenses per country are as follows: For the three-months ended For the six-months ended July 30, 2022 July 30, 2022 Canada US Consolidated Canada US Consolidated $ $ $ $ $ $ Sales 12,827 2,398 15,225 29,572 6,088 35,660 Cost of sales 7,311 1,440 8,751 16,525 3,697 20,222 Gross profit 5,516 959 6,474 13,047 2,392 15,438 Selling, general and administration expenses (allocated) 3,010 379 3,389 6,419 969 7,388 Results from operating activities before corporate expenses 2,506 580 3,085 6,628 1,423 8,050 Selling, general and administration expenses (non-allocated) 7,830 14,637 Results from operating activities (4,745 ) (6,587 ) Finance costs 167 338 Finance income (77 ) (116 ) Net loss before income taxes (4,835 ) (6,809 ) For the three-months ended For the six-months ended July 31, 2021 July 31, 2021 Canada US Consolidated Canada US Consolidated $ $ $ $ $ $ Sales 15,046 3,697 18,743 33,175 8,818 41,992 Cost of sales 8,725 2,023 10,748 18,589 4,640 23,229 Gross profit 6,321 1,674 7,995 14,586 4,178 18,763 Selling, general and administration expenses (allocated) 2,458 545 3,003 4,722 1,045 5,767 Results from operating activities before corporate expenses 3,863 1,129 4,992 9,864 3,133 12,996 Selling, general and administration expenses (non-allocated) 6,082 12,512 Restructuring plan activities, net (75,557 ) (77,159 ) Results from operating activities 74,467 77,643 Finance costs 23 33 Finance income (34 ) (89 ) Net income before income taxes 74,478 77,699 |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 6 Months Ended |
Jul. 30, 2022 | |
SUBSEQUENT EVENT | |
SUBSEQUENT EVENT | 10. SUBSEQUENT EVENT On August 23, 2022, a revolving line of credit on demand with the Bank of Nova Scotia (the “Bank”) was established for up to $15.0 million, less a reserve of $0.5 million for credit cards based on eligible accounts receivable and inventory balances and subject to financial covenants being met. The credit facility will bear interest at the prime rate plus 1% and is for a three-year period, renewable annually at the lender’s option In addition, Investissement Québec has provided a loan loss guarantee under its “Loan Loss Program”, securing 50% of any loss incurred by the Bank with respect to the recovery of indebtedness under the line of credit. |
SHARE CAPITAL (Tables)
SHARE CAPITAL (Tables) | 6 Months Ended |
Jul. 30, 2022 | |
Summary of authorized, issued, and outstanding shares | July 30, January 29, 2022 2022 $ $ Share Capital - (26,561,744) Common shares (January 29, 2022 - 26,423,717) 113,862 113,534 |
Summary of stock option plan and periodic changes | For the six-months ended July 30, July 31, 2022 2021 Weighted Weighted average average Options exercise Options exercise outstanding price outstanding price # $ # $ Outstanding and exercisable - beginning and end of period 3,490 14.39 17,490 6.32 |
Summary of the status of the RSU plan and periodic changes | For the six-months ended July 30, July 31, 2022 2021 Weighted Weighted average average RSUs fair value RSUs fair value outstanding per unit (1) outstanding per unit (1) # $ # $ Outstanding, beginning of period 1,282,790 2.60 1,306,101 1.70 Granted 511,264 2.66 425,764 4.64 Forfeitures (27,466 ) 2.28 (32,747 ) 1.50 Vested (138,027 ) 2.38 (125,387 ) 1.91 Vested, withheld for tax (143,711 ) 2.38 (130,562 ) 1.91 Outstanding, end of period 1,484,850 2.67 1,443,169 2.53 |
SELLING GENERAL AND ADMINISTR_2
SELLING GENERAL AND ADMINISTRATION EXPENSES (Tables) | 6 Months Ended |
Jul. 30, 2022 | |
Schedule of selling, general and administrative expenses | For the three-months ended For the six-months ended July 30, July 31, July 30, July 31, 2022 2021 2022 2021 $ $ $ $ Wages, salaries and employee benefits 3,542 3,447 6,950 6,824 Marketing expenses 1,609 1,692 3,906 2,896 IT ongoing expenses 1,326 1,173 2,735 2,487 Software implementation and configuration costs 1,325 1,592 2,080 2,454 Credit card fees 275 443 677 979 Director & officer and other insurance 343 305 690 565 Professional and consulting fees 764 790 1,159 1,255 Depreciation of property and equipment 88 407 164 795 Amortization of intangible assets 137 484 277 887 Amortization right-of-use asset 669 135 1,319 294 Stock-based compensation 398 363 708 545 Other selling, general and administration 743 786 1,360 1,894 Sub-total 11,219 11,617 22,025 21,875 Government emergency wage and rent subsidy — (2,532 ) — (3,596 ) 11,219 9,085 22,025 18,279 |
NET (LOSS) EARNINGS PER SHARE (
NET (LOSS) EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jul. 30, 2022 | |
Schedule of reconciliation of basic and diluted EPS | For the three-months ended For the six-months ended July 30, July 31, July 30, July 31, 2022 2021 2022 2021 $ $ $ $ Net (loss) income for basic EPS (4,835 ) 75,478 (6,809 ) 78,699 Weighted average number of shares outstanding: Basic 26,487,933 26,299,094 26,456,830 26,270,284 Fully diluted 26,487,933 27,455,005 26,456,830 27,422,066 Net (loss) earnings per share: Basic (0.18 ) 2.87 (0.26 ) 3.00 Fully diluted (0.18 ) 2.75 (0.26 ) 2.87 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jul. 30, 2022 | |
Schedule of revenue by product | For the three-months ended For the six-months ended July 30, July 31, July 30, July 31, 2022 2021 2022 2021 $ $ $ $ Tea 13,266 16,117 31,241 36,586 Tea accessories 1,484 2,626 3,583 5,406 Food and beverages 475 — 836 — 15,225 18,743 35,660 41,992 |
Schedule of gross profit per country | For the three-months ended For the six-months ended July 30, 2022 July 30, 2022 Canada US Consolidated Canada US Consolidated $ $ $ $ $ $ Sales 12,827 2,398 15,225 29,572 6,088 35,660 Cost of sales 7,311 1,440 8,751 16,525 3,697 20,222 Gross profit 5,516 959 6,474 13,047 2,392 15,438 Selling, general and administration expenses (allocated) 3,010 379 3,389 6,419 969 7,388 Results from operating activities before corporate expenses 2,506 580 3,085 6,628 1,423 8,050 Selling, general and administration expenses (non-allocated) 7,830 14,637 Results from operating activities (4,745 ) (6,587 ) Finance costs 167 338 Finance income (77 ) (116 ) Net loss before income taxes (4,835 ) (6,809 ) For the three-months ended For the six-months ended July 31, 2021 July 31, 2021 Canada US Consolidated Canada US Consolidated $ $ $ $ $ $ Sales 15,046 3,697 18,743 33,175 8,818 41,992 Cost of sales 8,725 2,023 10,748 18,589 4,640 23,229 Gross profit 6,321 1,674 7,995 14,586 4,178 18,763 Selling, general and administration expenses (allocated) 2,458 545 3,003 4,722 1,045 5,767 Results from operating activities before corporate expenses 3,863 1,129 4,992 9,864 3,133 12,996 Selling, general and administration expenses (non-allocated) 6,082 12,512 Restructuring plan activities, net (75,557 ) (77,159 ) Results from operating activities 74,467 77,643 Finance costs 23 33 Finance income (34 ) (89 ) Net income before income taxes 74,478 77,699 |
CORPORATE INFORMATION (Details
CORPORATE INFORMATION (Details Narrative) | 6 Months Ended |
Jul. 30, 2022 | |
Address Of Entity's Registered Office | 5430 Ferrier St., Town of Mount-Royal, Québec, Canada, H4P 1M2 |
SHARE CAPITAL (Details)
SHARE CAPITAL (Details) - CAD ($) $ in Thousands | Jul. 30, 2022 | Jan. 29, 2022 |
Share Capital - (26,561,744) Common shares (January 29, 2022 - 26,423,717) | $ 113,862 | $ 113,534 |
SHARE CAPITAL Parenthetical (De
SHARE CAPITAL Parenthetical (Details) - shares shares in Thousands | Jul. 30, 2022 | Jan. 29, 2022 |
Common shares | 26,561,744 | 26,423,717 |
SHARE CAPITAL (Details 1)
SHARE CAPITAL (Details 1) - $ / shares | 6 Months Ended | |
Jul. 30, 2022 | Jul. 31, 2021 | |
Outstanding and exercisable - beginning and end of period | 3,490 | 17,490 |
Outstanding and exercisable, weighted average exercise price | $ 14.39 | $ 6.32 |
SHARE CAPITAL (Details 2)
SHARE CAPITAL (Details 2) - $ / shares | 6 Months Ended | |
Jul. 30, 2022 | Jul. 31, 2021 | |
Outstanding, beginning of year | 1,282,790 | 1,306,101 |
Granted | 511,264 | 425,764 |
Forfeitures | (27,466) | (32,747) |
Vested | (138,027) | (125,387) |
Vested, withheld for tax | (143,711) | (130,562) |
Outstanding, end of period | 1,484,850 | 1,443,169 |
Weighted average fair value per unit, beginning of period | $ 2.60 | $ 1.70 |
Granted | 2.66 | 4.64 |
Forfeitures | 2.28 | 1.50 |
Vested | 2.38 | 1.91 |
Vested, withheld for tax | 2.38 | 1.91 |
Weighted average fair value per unit, end of period | $ 2.67 | $ 2.53 |
SHARE CAPITAL (Details Narrativ
SHARE CAPITAL (Details Narrative) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Statement [Line Items] | ||||
Stock-based compensation expense | $ 398 | $ 363 | $ 708 | $ 545 |
Common shares issued on vesting of restricted stock units, value | $ (328) | $ (740) | ||
2015 Omnibus Plan [Member] | ||||
Statement [Line Items] | ||||
Maximum number of shares available for issuance | 694,412 | 937,868 | ||
Options [Member] | ||||
Statement [Line Items] | ||||
Reduction in the contributed surplus | 658 | 142 | $ 670 | $ 486 |
Restricted Stock Units (RUS) [Member] | ||||
Statement [Line Items] | ||||
Common shares issued on vesting of restricted stock units, value | $ 322 | $ 70 | $ 328 | $ 239 |
Common Shares Issued On Vesting Of Restricted Stock Units, Shares | 134,452 | 104,200 | 138,027 | 125,387 |
SELLING GENERAL AND ADMINISTR_3
SELLING GENERAL AND ADMINISTRATION EXPENSES (Details) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Wages, Salaries And Employee Benefits | $ 3,542 | $ 3,447 | $ 6,950 | $ 6,824 |
Marketing Expenses | 1,609 | 1,692 | 3,906 | 2,896 |
IT ongoing expenses | 1,326 | 1,173 | 2,735 | 2,487 |
Software Implementation and configuration costs | 1,325 | 1,592 | 2,080 | 2,454 |
Credit Card Fees | 275 | 443 | 677 | 979 |
Director & officer and other insurance | 343 | 305 | 690 | 565 |
Professional and consulting fees | 764 | 790 | 1,159 | 1,255 |
Depreciation Of Property And Equipment | 88 | 407 | 164 | 795 |
Amortization Of Intangible Assets | 137 | 484 | 277 | 887 |
Amortization Right-of-use Asset | 669 | 135 | 1,319 | 294 |
Stock-based Compensation | 398 | 363 | 708 | 545 |
Other Selling, General And Administration | 743 | 786 | 1,360 | 1,894 |
Sub-total | 11,219 | 11,617 | 22,025 | 21,875 |
Government Emergency Wage And Rent Subsidies | 0 | (2,532) | 0 | (3,596) |
Selling, General And Administrative Expense | $ 11,219 | $ 9,085 | $ 22,025 | $ 18,279 |
SELLING GENERAL AND ADMINISTR_4
SELLING GENERAL AND ADMINISTRATION EXPENSES (Details Narrative) - CAD ($) | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Recognized payroll and rent subsidies | $ 0 | $ 2,500,000 | $ 0 | $ 3,600,000 |
RESTRUCTURING PLAN ACTIVITIES_2
RESTRUCTURING PLAN ACTIVITIES Net (Details Narrative) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | Jul. 08, 2020 | |
Statement [Line Items] | |||||
Professional fees | $ 764 | $ 790 | $ 1,159 | $ 1,255 | |
Companies CreditorArrangement Act [Member] | |||||
Statement [Line Items] | |||||
Gain on the settlement of liabilities | 75,557 | 77,159 | |||
Company creditor | $ 17,600 | ||||
Professional fees | $ 1,156 | $ 1,702 |
NET (LOSS) EARNINGS PER SHARE_2
NET (LOSS) EARNINGS PER SHARE (Details) - CAD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Net Earnings (loss) For Basic Eps | $ (4,835) | $ 75,478 | $ (6,809) | $ 78,699 |
Basic | 26,487,933 | 26,299,094 | 26,456,830 | 26,270,284 |
Fully Diluted | 26,487,933 | 27,455,005 | 26,456,830 | 27,422,066 |
Net Earnings (loss) Per Share: | ||||
Basic | $ (0.18) | $ 2.87 | $ (0.26) | $ 3 |
Fully Diluted | $ (0.18) | $ 2.75 | $ (0.26) | $ 2.87 |
RELATED PARTY DISCLOSURES (Deta
RELATED PARTY DISCLOSURES (Details Narrative) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Resale | $ 44 | $ 153 | $ 44 | $ 199 |
Administrative services | 5 | $ 5 | 10 | $ 10 |
Accounts and other receivables | 2 | 2 | ||
Trade and other payables Outstanding | $ 44 | $ 44 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Statement [Line Items] | ||||
Revenue | $ 15,225 | $ 18,743 | $ 35,660 | $ 41,992 |
Tea [Member] | ||||
Statement [Line Items] | ||||
Revenue | 13,266 | 16,117 | 31,241 | 36,586 |
Tea accessories [Member] | ||||
Statement [Line Items] | ||||
Revenue | 1,484 | 2,626 | 3,583 | 5,406 |
Food and beverages [Member] | ||||
Statement [Line Items] | ||||
Revenue | $ 475 | $ 0 | $ 836 | $ 0 |
SEGMENT INFORMATION (Details 1)
SEGMENT INFORMATION (Details 1) - CAD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 30, 2022 | Jul. 31, 2021 | Jul. 30, 2022 | Jul. 31, 2021 | |
Statement [Line Items] | ||||
Sales | $ 15,225 | $ 18,743 | $ 35,660 | $ 41,992 |
Cost Of Sales | 8,751 | 10,748 | 20,222 | 23,229 |
Gross Profit | 6,474 | 7,995 | 15,438 | 18,763 |
Results From Operating Activities | (4,745) | 74,467 | (6,587) | 77,643 |
Operating Segments [Member] | Canada Segment [Member] | ||||
Statement [Line Items] | ||||
Sales | 12,827 | 15,046 | 29,572 | 33,175 |
Cost Of Sales | 7,311 | 8,725 | 16,525 | 18,589 |
Gross Profit | 5,516 | 6,321 | 13,047 | 14,586 |
Selling, General And Administration Expenses (allocated) | 3,010 | 2,458 | 6,419 | 4,722 |
Results From Operating Activities Before Corporate Expenses | 2,506 | 3,863 | 6,628 | 9,864 |
Operating Segments [Member] | Consolidated Segments [Member] | ||||
Statement [Line Items] | ||||
Sales | 15,225 | 18,743 | 35,660 | 41,992 |
Cost Of Sales | 8,751 | 10,748 | 20,222 | 23,229 |
Gross Profit | 6,474 | 7,995 | 15,438 | 18,763 |
Selling, General And Administration Expenses (allocated) | 3,389 | 3,003 | 7,388 | 5,767 |
Results From Operating Activities Before Corporate Expenses | 3,085 | 4,992 | 8,050 | 12,996 |
Selling, General And Administration Expenses (non-allocated) | 7,830 | 6,082 | 14,637 | 12,512 |
Restructuring Plan Activities, Net | (75,557) | (77,159) | ||
Results From Operating Activities | (4,745) | 74,467 | (6,587) | 77,643 |
Finance Costs | 167 | 23 | 338 | 33 |
Finance Income | (77) | (34) | (116) | (89) |
Net Income (loss) Before Income Taxes | (4,835) | 74,478 | (6,809) | 77,699 |
Operating Segments [Member] | United States Segment [Member] | ||||
Statement [Line Items] | ||||
Sales | 2,398 | 3,697 | 6,088 | 8,818 |
Cost Of Sales | 1,440 | 2,023 | 3,697 | 4,640 |
Gross Profit | 959 | 1,674 | 2,392 | 4,178 |
Selling, General And Administration Expenses (allocated) | 379 | 545 | 969 | 1,045 |
Results From Operating Activities Before Corporate Expenses | $ 580 | $ 1,129 | $ 1,423 | $ 3,133 |
SUBSEQUENT EVENT (Details Narra
SUBSEQUENT EVENT (Details Narrative) - Event after reporting period [Member] $ in Millions | 1 Months Ended |
Aug. 23, 2022 CAD ($) | |
Statement [Line Items] | |
Credit facility | The credit facility will bear interest at the prime rate plus 1% and is for a three-year period, renewable annually at the lender’s option In addition, Investissement Québec has provided a loan loss guarantee under its “Loan Loss Program”, securing 50% of any loss incurred by the Bank with respect to the recovery of indebtedness under the line of credit. |
Reserve | $ 0.5 |
Credit on demand | $ 15 |