WINNIPEG, April 22, 2019 /CNW/ - DELTA 9 CANNABIS INC. (TSXV: NINE) (OTCQX: VRNDF) ("Delta 9" or the "Company"), is pleased to announce financial and operating results for the year ending December 31, 2018.

2018 Year End Financial Highlights

Record operating revenues of $7.57M for the year ending December 31, 2018 , up 702%, from $944,114 for the year ending December 31, 2017

for the year ending , up 702%, from for the year ending Record gross profit of $5.74M for the year ending December 31, 2018 , up 1,200%, from $442,681 for the year ending December 31, 2017

for the year ending , up 1,200%, from for the year ending Net income was a loss of $8.61M for the year ending December 31, 2018 , primarily as a result of expanding operations in advance of legalization of recreational use cannabis in the fourth quarter of 2018.

for the year ending , primarily as a result of expanding operations in advance of legalization of recreational use cannabis in the fourth quarter of 2018. The Company reported a strong financial position, with working capital of $20.7M and total assets of $46.0M , having raised over $30.7M in debt and equity during the year.

4th Quarter, 2018 Versus 3rd Quarter, 2018 Results

Record operating revenues of $5.27M for the three-month period ending December 31, 2018 , up 321%, from $1.25M for the three-month period ending September 30, 2018 .

for the three-month period ending , up 321%, from for the three-month period ending . Record gross profit of $3.34M for the three-month period ending December 31, 2018 , up 118%, from $1.53M for the three-month period ending September 31, 2018 .

for the three-month period ending , up 118%, from for the three-month period ending . Prudent cost management narrowed quarterly loss to $2.17M ( $0.02 per share) for the three-month period ending December 31, 2018 versus a loss of $2.23M ( $0.03 per share) for the three-month period ending September 30, 2018 .

Operational Highlights

2018 expansion increased the number of Delta 9 grow pods approved by Health Canada to 154 from 15, increasing anticipated annual production capacity to over 4,200 Kg of dried cannabis flower.

Delta 9 announced its intention to become a preferred supplier of medical cannabis to Pharmasave, a national pharmacy chain with approximately 650 retail outlets.

Delta 9 entered into a supply agreement for 2.3M grams of cannabis with the Province of Manitoba .

grams of cannabis with the Province of . Delta 9 entered into an agreement to supply 1,000 Kg of cannabis per year for 10 years to Auxly Cannabis Group Inc.

Delta 9 now operates three retail stores, two in Winnipeg, Manitoba and one in Brandon, Manitoba . A fourth retail store in Thompson, Manitoba is scheduled to open in June, 2019.

"2018 was a transformation year for Delta 9 as we proved our business model of using retrofitted shipping containers (Grow Pods) to grow cannabis successfully and produced a consistent high-quality cannabis product," said John Arbuthnot, CEO. "Our strategy of being one of Canada's only vertically integrated cannabis companies with licences for production, processing, distribution and retail operations is paying off and now producing significant financial results. The legalization of the adult consumer recreational market in October last year is only the beginning of many new and exciting opportunities for the Company."

Selected Annual Information:

Consolidated Statement of Net Loss 2018 2017 Revenue $7,569,283 $944,114 Cost of Sales 5,558,066 627,376 Gross Profit Before Unrealized Gain from Changes In Biological Assets 2,011,217 316,738 Unrealized gain from changes in fair value of biological assets 3,727,595 125,943 Gross Profit $5,738,812 $442,681





Expenses



General and Administrative 10,566,669 2,514,621 Sales and Marketing 1,069,014 383,797 Share based Compensation 2,622,228 257,189 Total Operating Expenses $14,257,911 $3,155,607





Loss from Operations $(8,500,997) $(2,712,926)





Other Income/ Expenses



Other Income/ Expenses (Other Income, Rental Income, Disposal of Assets) (84,228) 7,751 Public Listing Costs 0 (5,219,055)





Net Loss and Comprehensive Loss $(8,608,350) $(7,924,230)





Loss per Share (basic) $(0.10) $(0.16) Weighted average number of shares outstanding 81,277,702 48,732,913

Consolidated Statement of Financial Position 2018 2017 Current Assets $26,394,143 $24,760,610 Property, Plant, and Equipment 16,839,328 275,192 Total Assets $45,992,471 $25,035,802





Current Liabilities $5,689,300 $479,404 Long Term Liabilities 4,940,836 0 Total Liabilities $10,630,135 $479,404





Shareholder Equity/ (Deficiency) $35,362,336 $24,556,398

Summary of Quarterly Results:

Consolidated Statement of Net Loss Q4 2018 Q3 2018 Q2 2018 Q1 2018 Revenue $5,270,217 $1,251,213 $715,746 $332,107 Cost of Sales $4,015,644 $938,733 $380,520 $223,169 Gross Profit Before Unrealized Gain From Changes In Biological Assets $1,254,573 $312,480 $335,226 $108,938 Unrealized gain from changes in fair value of biological assets $2,087,367 $1,218,257 $328,214 $93,757 Gross Profit (Loss) $3,341,940 $1,530,737 $663,440 $202,695









Expenses







General and Administrative $4,323,796 $2,790,227 $2,064,333 $1,388,313 Sales and Marketing $379,898 $300,138 $265,332 $123,646 Share Based Compensation $807,834 $671,606 $521,598 $621,190 Total Operating Expenses $5,511,528 $3,761,971 $2,851,263 $2,133,149









Income (Loss) from Operations $(2,169,588) $(2,231,234) $(2,187,823) $(1,930,454) Basic and Diluted Earnings (Loss) Per Share $(0.02) $(0.03) $(0.03) $(0.02)

Consolidated Statement of Net Loss Q4 2017 Q3 2017 Q2 2017 Q1 2017 Revenue $302,284 $303,877 $190,099 $147,854 Cost of Sales $42,137 $269,815 $155,354 $159,970 Gross Profit Before Unrealized Gain From Changes In Biological Assets $260,147 $34,062 $34,745 $(12,116) Unrealized gain from changes in fair value of biological assets - - $208,850 $43,578 Gross Profit (Loss) $260,147 $34,062 $243,595 $31,462









Expenses







General and Administrative $908,458 $689,612 $1,207,954 $385,225 Sales and Marketing $133,893 $69,309 $108,797 $71,798 Share Based Compensation - - - - Total Operating Expenses $1,042,351 $758,921 $1,316,751 $457,023









Income (Loss) from Operations $(782,204) $(716,015) $(1,073,156) $(425,561) Basic and Diluted Earnings (Loss) Per Share $(0.01) $(0.02) $(0.02) $(0.01)

A comprehensive discussion of Delta 9's financial position and results of operations is provided in the Company's Management Discussion & Analysis for the year ended December 31, 2018 filed on SEDAR and can be found at www.sedar.com .

Year-End Results 2018 Conference Call

Delta 9 has scheduled a conference call to discuss the results for its fourth quarter and year ended December 31, 2018. The conference call will be hosted April 23, 2018 at 9:00 a.m. Eastern Time by John Arbuthnot, Chief Executive Officer, and Jim Lawson, Chief Financial Officer, followed by a question and answer period.

Date April 23, 2019 Time 9:00 EST Dial in # 1-888-886-7786 - Toll free North America Conference ID: 30846572



Replay information: 1-877-674-6060 Replay Password 846572#

Available until July 23, 2019

About Delta 9 Cannabis Inc.

Delta 9 Cannabis Inc. is a vertically integrated cannabis company focused on bringing the highest quality cannabis products to market. Delta 9's wholly-owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical and recreational cannabis and operates an 80,000 square foot production facility in Winnipeg, Manitoba, Canada. Delta 9 owns and operates a chain of retail stores under the Delta 9 Cannabis Store brand. Delta 9's shares trade on the TSX Venture Exchange under the symbol "NINE" and on the OTCQX under the symbol VRNDF. For more information, please visit www.delta9.ca.

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.

Disclaimer for Forward-Looking Information

Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Company's future business plans and other matters. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Forward looking statements in this news release include statements relating to: (i) increases in Delta 9's cannabis production capacity; (ii) Delta 9's intentions to supply cannabis; and (iii) Delta 9's retail store expansion. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including the Company's actual financial results being different from its estimates as well as all risk factors set forth in the annual information form of Delta 9 dated May 31, 2018 which has been filed on SEDAR. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are urged to consider these factors carefully in evaluating the forward-looking statements contained in this news release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. These forward-looking statements are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.

SOURCE Delta 9 Cannabis Inc.

For further information: Investor & Media Contact: Ian Chadsey VP Corporate Affairs, Mobile: 204-898-7722, E-mail: [email protected]

Related Links

www.delta9.ca

