TORONTO, Oct. 29, 2019 /CNW/ - Namaste Technologies Inc. ("Namaste" or the "Company") (TSXV:N.V - News) (FRANKFURT:M5BQ.F - News) (OTCMKTS:NXTTF - News), a leading online platform for cannabis products, accessories, and responsible education, today announced its interim financial results for the third quarter ended August 31, 2019. All financial figures are in Canadian dollars unless otherwise indicated.

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Third Quarter Highlights:

Consolidated revenue of $3.8 million compared with $3.9 million for the same period last year reflecting the Company's ability to rebuild revenue, from other sources, after discontinuing certain web properties,

compared with for the same period last year reflecting the Company's ability to rebuild revenue, from other sources, after discontinuing certain web properties, Gross margin increased to 26% compared to 24% in the third quarter of 2018,

The Company finished the third quarter with positive working capital of $54.2 million , including $49.1 million in cash and cash equivalents,

, including in cash and cash equivalents, The board of directors named Mr. Meni Morim as chief executive officer and appointed him to the Company's board of directors,

as chief executive officer and appointed him to the Company's board of directors, CannMart continued to add products to the everything cannabis online marketplace with a distribution and marketing sales agreement signed with Seedo Corp subsidiary Eroll Grow Tech Ltd, and

The Company reached settlements, in principle, of the securities class actions that were commenced against it in Canada and the United States in 2018.





"We're seeing the positive effects of rebuilding our revenue stream in our drive to replace discontinued businesses," said Meni Morim, CEO of Namaste. "Highlighting this internal shift is how we've successfully increased our end-to-end customer conversion rate on Namaste MD patients to CannMart customers from less than 1% in January to over 6% today and we expect this growth to continue. We are diversifying our revenue and see a great market opportunity in front of us both in B2B and B2C. As an example, 49% of all Namaste MD patients this year have been prescribed oils, which we can now service with the recent Health Canada license amendment approval. Additionally, we have 14,000 patient prescriptions that are pending renewal between now and December 31st, and will be receiving a renewal notice shortly. Appreciably, this is a significant increase in our addressable market, and with the work on increasing our conversion rates, we expect to see the positive impact on revenue growth."

"Other areas of our business continue to expand. We continue to build our government revenue channel and expect to make further progress and related announcements during the current quarter. On the expense side, we have incurred one-time costs, including professional fees related to the class action lawsuit, reflected in our selling, general and administrative expenses. As a result of reaching settlements, in principle, we expect to see these professional and related one-time costs to decrease moving forward. We have made some tough decisions to improve the Company's outlook and expect to make further changes. I look forward to keeping our shareholders up to date as we increase our focus and attention on our bottom line."

SUMMARY OF CONSOLIDATED FINANCIAL RESULTS

Revenue for the quarter ended August 31, 2019 was $3.8 million, compared to $3.9 million in the comparable quarter in the prior year reflecting the Company's ability to rebuild revenue after discontinuing certain web properties and select businesses. Gross margin for the quarter ended August 31, 2019 was 26%, a 2% increase versus the same quarter last year primarily due to the year-over-year decrease of cost of good sold.

Selling, general and administration expenses for the quarter ended August 31, 2019 was $11.0 million, compared to $10.3 million in the comparable quarter in the prior year. The change in expenses primarily reflect the Company's professional expenses related to the class action lawsuits and subsequent settlement in principle, offset by a decrease in share-based compensation expenses.

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