UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
March 23, 2023
Date of Report (Date of earliest event reported)
BODY AND MIND INC. |
(Exact name of registrant as specified in its charter) |
Nevada | | 000-55940 | | 98-1319227 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
750 – 1095 West Pender Street Vancouver, British Columbia, Canada | | V6E 2M6 |
(Address of principal executive offices) | | (Zip Code) |
(800) 361-6312
Registrant’s telephone number, including area code
Not applicable.
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol (s) | Name of each exchange on which registered |
N/A | N/A | N/A |
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (Section 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (Section 240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒
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SECTION 2 – FINANCIAL INFORMATION
Item 2.02 Results of Operations and Financial Condition.
On March 23, 2023, Body and Mind Inc. (the “Company” or “BaM”) issued a news release announcing its financial results for the second quarter of fiscal year 2023 ended January 31, 2023. The information regarding the financial results for the second fiscal quarter ended January 31, 2023 of the Company contained in Item 7.01 below is responsive to this Item 2.02 and is incorporated into this Item 2.02 by reference.
The information in this Item 2.02 (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as expressly set forth by specific reference in such a filing.
SECTION 7 – REGULATION FD
Item 7.01 Regulation FD Disclosure.
On March 23, 2023, the Company issued a news release to announce financial results for the second quarter of fiscal year 2023 ended January 31, 2023 and to provide shareholders with an operational update. All financial information is provided in U.S. dollars unless otherwise indicated.
Q2 FY 2023 Summary & Comparison to Q1 FY 2023 (in Millions of US$)
| | Q2 FY 2023 | | | Q1 FY 2023 | |
Revenue | | $ | 7.7 | | | $ | 7.8 | |
Net Income/(Loss) | | $ | (2.7 | ) | | $ | (3.0 | ) |
Adjusted EBITDA* | | $ | (1.3 | ) | | $ | (1.6 | ) |
Q2 FY 2023 (ended January 31, 2023) and Subsequent Highlights:
| · | Advanced tenant improvement construction on the first of two Illinois adult-use dispensaries. The dispensary is located within the largest retail mall in Markham, Illinois, which has average daily traffic counts of more than 400,000 cars per day within a mile of the project location, and the Company projects that its first retail sale will occur in April 2023. |
| · | Closed a merger with CraftedPlants NJ, Inc., an entity that holds a lease on a New Jersey commercial property with local cannabis-use approval for a retail location with nearly all merger consideration tied to successful completion of specific licensing and operational milestones. (See the Company’s December 22, 2022 press release for further details.) |
| · | Submitted New Jersey state license application in conjunction with BaM Body and Mind Dispensary NJ, Inc. f/k/a CraftedPlants NJ, Inc. Commenced design, architectural and planning work for the New Jersey location. |
| · | Began selling Body and Mind branded vape cartridges in Arkansas. |
Management Commentary
“Our most recent quarter reflects improvement in wholesale pricing in Nevada and wholesale growth in Ohio as we focus on development of the new Illinois and New Jersey dispensaries,” stated Michael Mills, CEO of Body and Mind Inc. “Construction at our new Illinois dispensary in Markham is more than 90% complete and we are on track to open in the next month as we leverage dispensary opening and operational experience from multiple markets. In Arkansas we expanded Body and Mind branded product offerings with new Body and Mind branded vape cartridges joining our wide existing product offerings including craft flower and concentrates.”
Q2 FY 2023 Financial Highlights:
| · | Revenues for Q2 FY 2023 were $7.7 million, a slight decrease over Q1 FY 2023 revenues of $7.8 million. |
| · | Gross profit of $2.26 million for Q2 FY 2023 compared to a gross profit of $1.6 million for Q1 FY 2023. |
| · | Q2 FY 2023 net operating loss was $1.8 million compared to Q1 FY 2023 net operating loss of $2.0 million. Net operating income was primarily impacted by increased business development expenses related to Illinois and New Jersey, license applications and new operation startup expenses. An increase in wholesale flower pricing in Nevada in Q2 improved both the gross profit and net operating loss. |
| · | Q2 FY 2023 net loss was $2.7 million (or basic and diluted loss per share of $0.02) compared with Q1 FY 2023 net loss of $3.0 million (or basic and diluted loss per share of $0.03). |
| · | Adjusted EBITDA loss of $1.3 million for Q2 FY 2023 vs. Adjusted EBITDA loss of $1.6 million for Q1 FY 2023*. |
| · | Total Current Assets were $8.1 million, Total Assets were $32.6 million, Total Current Liabilities were $8.5 million and Total Liabilities were $27.6 million at January 31, 2023. |
The Company had 146,636,974 common shares outstanding as of January 31, 2023.
For further details, please see the Company’s recent Form 10-Q filing on EDGAR at www.sec.gov/edgar/search, and the interim financial statements filed on SEDAR at www.sedar.com.
*Adjusted EBITDA is a Non-GAAP metric used by management that does not have any standardized meaning prescribed by U.S. GAAP and may not be comparable to similar measures presented by other companies. Management defines the Adjusted EBITDA as the Income (loss) from operations, as reported, before interest, taxes, and adjusted for removing other non-cash items, including stock-based compensation expense, gain on settlement, loss on impairment, depreciation, and further adjustments to remove acquisition related costs or gains. Management believes Adjusted EBITDA is a useful financial metric to assess its operating performance on a cash adjusted basis before the impact of non-cash items and acquisition activities. The most comparable financial measure calculated and presented in accordance with U.S. GAAP is net income (loss), which was presented above prior to the Adjusted EBITDA figure.
Net Profit/Loss | | $ | (2,741,050 | ) |
Interest Income | | $ | (18,000 | ) |
Interest | | $ | 425,124 | |
Tax | | $ | 620,062 | |
Depreciation/Amortization | | $ | 362,623 | |
EBITDA | | $ | (1,351,241 | ) |
EBITDA | | $ | (1,351,241 | ) |
Gain on settlement | | | 0 | |
Loss on impairment | | | 0 | |
Stock-based compensation | | $ | 22,014 | |
Adjusted EBITDA | | $ | (1,329,227 | ) |
A copy of the news release is attached as Exhibit 99.1 hereto.
The information in this Item 7.01 (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | BODY AND MIND INC. | |
| | | | |
| DATE: March 23, 2023 | By: | /s/ Michael Mills | |
| | Michael Mills | |
| | | President, CEO and Director | |
