Highly rated 1 Medizin dispensary generated $4.4 million in revenue in Q2 2018 and $8.0 million YTD; monthly revenue is growing at a 7.8% compound rate 2

Adjusted EBITDA of $789,909 in Q2 2018 and $1.2 million YTD;

Planet 13 Superstore (the "Superstore") – 40,000 square foot cannabis entertainment complex – set to open November 1 st 2018. All required licensing in place and construction ahead of schedule

413 online deliveries in July 2018 ; monthly online revenue growing at a compound rate of 13.5%2 sequentially

All figures are reported in United States dollars ($), unless otherwise indicated

LAS VEGAS, Aug. 29, 2018 /CNW/ - Planet 13 Holdings Inc. (CSE: PLTH) ("Planet 13" or the "Company"), a leading vertically-integrated Nevada cannabis company, today announced record financial results for the three and six-month periods ended June 30, 2018. Planet 13's financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS").

"With two months until the Grand Opening of Phase 1 of the 40,000 square foot Planet 13 Superstore, our team is ahead of schedule," said Bob Groesbeck, Co-CEO of Planet 13. "Construction is progressing rapidly, and we are in the market every day buying product from the top cultivators and brands in Nevada, with the expectation that we will be fully stocked by October 1st. Q2 2018 was the eighth consecutive quarter of revenue growth from our Medizin location. Given sustained growth in customer traffic, a team that has consistently made Medizin one of the top-rated dispensaries in Las Vegas1, and the building excitement about a world class cannabis and entertainment destination opening adjacent to the Las Vegas Strip, we are confident that we will hit our financial targets quickly and drive strong returns for shareholders."

Larry Scheffler, Co-CEO of Planet 13 added, "We are well capitalized to execute our business plans and given the performance we are seeing in the market, anticipate rapid revenue and cash flow growth from the Superstore location when it opens. Based on our discussions with regulators, we estimate 1.1 million square feet of cultivation capacity coming onstream over the next 12 to 18 months in a market that was fully supplied by 250,000 square feet in 2017. This anticipated oversupply will further bolster margins at the Superstore and has enabled our team to both invest now to prepare for the anticipated approval of a lounge concept on-site early next year and to evaluate accretive retail opportunities in other tier-one U.S. destinations. We have locked-down the closest possible location to the Las Vegas Strip, just steps from some of the most valuable entertainment properties in the world, with significant expansion opportunities on-site. We expect the Superstore to rapidly become a global destination for cannabis aficionados and to drive the brand awareness and loyalty required to enable a rapid and profitable expansion across the U.S."

Financial Highlights – Q2 – 2018

Operating Results

All comparisons below are to the quarter ended June 30, 2017, unless otherwise noted

Revenues were $4.4 million as compared to $1.5 million , an increase of 203%

as compared to , an increase of 203% Gross margin was $2.4 million as compared $1.4 million , an increase of 69%

as compared , an increase of 69% Operating expenses were $1.9 million as compared to $622,152 , an increase of 201%

as compared to , an increase of 201% Net loss of $3.4 million as compared to a net income of $22,209

as compared to a net income of Adjusted EBITDA of $798,909 as compared to $128,584

Balance Sheet

All comparisons below are to December 31, 2017, unless otherwise noted

Cash and cash equivalents of $17.1 million as compared to $0.5 million , an increase of 3,686%

as compared to , an increase of 3,686% Total assets of $26.9 million as compared to $8.6 million , an increase of 214%

as compared to , an increase of 214% Total liabilities of $6.0 million as compared to $11.0 million , a decrease of 46%

Q2 Highlights and Recent Developments

For a more comprehensive overview of these highlights and recent developments, please refer to Planet 13's Management's Discussion and Analysis of the Financial Condition and Results of Operations for the Three and Six Months Ended June 30, 2018 (the "MD&A").

On May 23, 2018 , the Company completed its funding round for combined gross proceeds of approximately $20,205,000 .

, the Company completed its funding round for combined gross proceeds of approximately . On June 21, 2018 , the Company's common shares commenced trading on the Canadian Securities Exchange.

Results of Operations (Summary)

The following tables set forth consolidated statements of financial information for the three and six-month periods ending June 30, 2018 and June 30, 2017. For further information regarding the Company's financial results for these periods, please refer to the Company's interim financial statements for the period ended June 30, 2018 together with the MD&A, available on Planet 13's issuer profile on SEDAR at www.sedar.com and the Company's website https://www.planet13holdings.com.





Three Months

Three Months





Six Months

Six Months





Ended

Ended

Percentage

Ended

Ended

Percentage

Jun-30-2018

Jun-30-2017

Change

Jun-30-2018

Jun-30-2017

Change Revenue





















Revenues, net of discounts 4,426,197

1,461,782

202.8%

8,026,679

2,596,215

209.2% Gain on Biological Asset Transformation 1,058,531

774,970

36.6%

3,189,227

2,375,657

34.2% Cost of Goods Sold (3,105,592)

(830,114)

274.1%

(7,214,697)

(1,450,086)

397.5% Gross Profit 2,379,136

1,406,638

69.1%

4,001,209

3,521,786

13.6%























Expenses





















General and Administrative 1,644,556

589,735

178.9%

2,755,501

1,021,788

169.7% Sales and Marketing 229,363

32,417

607.5%

334,909

45,808

631.1% Depreciation and Amortization 29,077

28,804

0.9%

61,440

57,239

7.3% Non-cash Compensation Expense 1,596,134

-

n/a

1,596,134

-

n/a Total Expenses 3,499,130

650,956

437.5%

4,747,983

1,124,835

322.1%























Income (Loss) From Operations (1,119,994)

755,682

(248.2%)

(746,774)

2,396,951

(131.2%)























Other (Income) Expense:





















Interest Expense, net 121,405

255,218

(52.4%)

239,857

488,337

(50.9%) Foreign exchange (gain) loss 266,521

-

n/a

266,521

-

n/a RTO acquisition costs 532,367

-

n/a

532,367

-

n/a (Gain) loss on conversion of debt 848,925

-

n/a

848,925

-

n/a Total Other (Income) Expense 1,769,218

255,218

593.2%

1,887,669

488,337

286.6%























Net loss for the period before tax (2,889,212)

500,464

(677.3%)

(2,634,443)

1,908,614

(238.0%) Provision for tax - current 514,093

478,255

7.5%

854,728

1,197,406

(28.6%) Net Income (Loss) for the period (3,403,305)

22,209

(15424.0%)

(3,489,171)

711,208

(590.6%)















































Loss per share for the period





















Basic and fully diluted loss per share ($0.04)

na





($0.04)

na



























Weighted Average Number of Shares Outstanding 83,819,620

nil





79,434,174

nil































Adjusted EBITDA



























Three Months

Three Months





Six Months

Six Months





Ended

Ended

Percentage

Ended

Ended

Percentage

Jun-30-2018

Jun-30-2017

Change

Jun-30-2018

Jun-30-2017

Change EBITDA





















Net profit (loss) before taxes (2,889,212)

500,464

(677.3%)

(2,634,443)

1,908,614

(238.0%) Add back:























Net change in Bio Asset valuation 164,358

(774,970)

na

68,926

(2,375,657)

na

Non-cash Compensation Expense 1,596,134

-

na

1,596,134

-

na

Depreciation and amortization 29,077

28,804

0.9%

61,440

57,239

7.3%

Depreciation included in COGS 129,334

119,068

8.6%

258,787

236,651

9.4%

Other (Income) Expense - one time RTO related costs 1,769,218

255,218

593.2%

1,887,669

488,337

286.6%























EBITDA 798,909

128,584

521.3%

1,238,512

315,184

292.9%



Summary of Quarterly Results



Three months ended Jun-30-2018 Mar-31-2018 Dec-31-2017 Sep-30-2017 Jun-30-2017 Mar-31-2017 Dec-31-2016 Sep-30-2016 US$ $ $ $ $ $ $ $ $ Total revenue 4,426,197 3,600,482 3,382,717 3,025,048 1,461,779 1,134,434 840,009 499,860 Net income (loss) (3,403,305) (85,868) 340,621 280,348 11,087 189,485 (660,597) (424,386)

















Comprehensive Net Income (loss) (3,403,305) (85,868) 340,621 280,348 11,087 189,485 (660,597) (424,386)

















Net Income (loss) per share (0.04) (0.00) n/a n/a n/a n/a n/a n/a Total assets 26,942,786 9,081,603 8,558,870 7,546,186 7,463,866 6,836,301 5,062,394 5,177,915 Total liabilities 5,957,754 8,314,441 11,040,144 11,680,362 11,760,007 10,986,251 8,365,209 8,538,183 Working capital (deficiency) 17,236,373 1,344,989 1,197,763 2,178,498 2,218,708 1,670,162 (536,659) 254,038 Dividends declared - - - - - - - -



Daily Traffic and Average Customer Spend





Six Months Six Months

Three Months Three Months

Three Months Three Months



Ended Ended

Ended Ended

Ended Ended



30/Jun/18 30/Jun/17 % Change 30/Jun/18 30/Jun/17 % Change 31/Mar/18 31/Mar/18 % Change



















Average Daily Traffic 638 198 222.6% 693 226 206.0% 581 168 245.3%



















Average spend per customer $69.95 $72.97 (4.1%) $70.22 $70.96 (1.0%) $69.61 $75.74 (8.1%)



Outstanding Shares

As at the date of this report, the Company had 62,008,400 common shares and 55,232,940 class A convertible, restricted voting shares issued and outstanding for a total of 117,241,340 shares outstanding. There were 820,000 options issued and outstanding of which 258,750 have fully vested. There were 17,214,795 warrants outstanding and 5,638,358 RSU's outstanding of which 1,879,453 RSUs had fully vested as at June 30, 2018 and at the date of this report.

Conference Call

Planet 13 will host a conference call on Wednesday, August 29, 2018 at 8:00 a.m. ET to discuss its second quarter financial results and provide investors with key business highlights. The call will be chaired by Bob Groesbeck, Co-CEO, Larry Scheffler, Co-CEO, and Dennis Logan, CFO.

CONFERENCE CALL DETAILS

Date: August 29, 2018 | Time: 8:00am EST

Participant Dial-in: 416-764-8688 or 1-888-390-0546

Replay Dial-in: 416-764-8677 or 1-888-390-0541

(Available for 2 weeks)

Reference Number: 689023

Listen to webcast: https://bit.ly/2n9BSgc

For more information, please visit https://www.planet13holdings.com/ and follow on Instagram planet13dispensary, Facebook Planet 13 Las Vegas and Twitter @Planet13lv.

(1) Based on customer feedback scores of 4.7-4.9 on a 5-pt scale from Leafly, Weedmaps, and Google (2) Monthly growth rates are sequential compound annual growth rates from January 1, 2018 to July 31, 2018

Financial Measures

There are measures included in this news release that do not have a standardized meaning under generally accepted accounting principles (GAAP) and therefore may not be comparable to similarly titled measures and metrics presented by other publicly traded companies. The Company includes these measures because it believes certain investors use these measures and metrics as a means of assessing financial performance. EBITDA (earnings before interest, taxes, depreciation and amortization) is calculated as net earnings before finance costs (net of finance income), income tax expense, and depreciation and amortization of intangibles and is a non-GAAP financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies.

About Planet 13

Planet 13 (www.planet13holdings.com) is a vertically integrated cannabis company based in Nevada, with award-winning cultivation, production and dispensary operations in Las Vegas - the entertainment capital of the world. Planet 13's mission is to build a recognizable global brand known for world class dispensary operations, and a creator of innovative cannabis products. Planet 13's shares trade on the Canadian Stock Exchange (CSE) under the symbol PLTH.

Cautionary Note Regarding Forward-Looking Information

This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward looking-statements relate to, among other things, future potential local, regional and national expansion plans, including the completion of the construction of the Company's Superstore within the projected timeline or at all, estimated foot traffic at the Company's proposed retail locations, anticipated revenue and cash flow growth from the Superstore, anticipated approval of the Company's on-site lounge concept at the Superstore, and the ability to enter into third party supply agreements for cannabis and cannabis related products on terms favorable to the Company or at all.

These forward-looking statements are based on reasonable assumptions and estimates of management of the Company at the time such statements were made. Actual future results may differ materially as forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to materially differ from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors, among other things, include: final regulatory and other approvals or consents; fluctuations in general macroeconomic conditions; changes in project development and construction time frames, risk related the possibility of project cost overruns or unanticipated costs and expenses, higher prices for fuel, steel, power, labour and other consumables contributing to higher costs associated with the completion of the Company's Superstore; fluctuations in securities markets; expectations regarding the size of the legal Nevada and U.S. cannabis markets and changing consumer habits; the ability of the Company to successfully achieve its business objectives; plans for expansion; political and social uncertainties; inability to obtain adequate insurance to cover risks and hazards; and the presence of laws and regulations that may impose restrictions on cultivation, production, distribution and sale of cannabis and cannabis related products in the State of Nevada; and employee relations. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. The Company assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.

Future-orientated financial information and financial outlook information (collectively, "FOFI") contained in this news release, as such terms are defined by applicable securities laws, is provided for the purpose of providing information about management's current expectations and plans relating to the future. FOFI contained in this news release was made as of the date of this news release and was provided for the purpose of disclosing material undisclosed information pertaining to the Company. The Company disclaims any intention or obligations to update or revise any FOFI contained in this news release unless required by applicable law. Readers are cautioned that reliance on such information may not be appropriate for other purposes.

The Company is indirectly involved in the manufacture, possession, use, sale and distribution of cannabis in the recreational and medicinal cannabis marketplace in the United States through its subsidiary MMDC. Local state laws where MMDC operates permit such activities however, these activities are currently illegal under United States federal law. Additional information regarding this and other risks and uncertainties relating to the Company's business are contained under the heading "Risk Factors" in the Company's Listing Statement dated May 24, 2018 filed on its issuer profile on SEDAR at www.sedar.com.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION



As at

As at



30-Jun-18

December 31,



2018

2017 Assets







Current Assets







Cash and cash equivalents

17,109,458

451,869 HST receivable

55,080

- Inventory (Note 7)

1,183,893

966,622 Biological assets (Note 8)

2,637,409

2,706,335 Prepaid expenses

733,401

92,129 Total Current Assets

21,719,240

4,216,955









Property and equipment (Note 9)

5,223,546

4,341,915



5,223,546

4,341,915 Total Assets

26,942,786

8,558,870









Liabilities







Current Liabilities







Accounts payable and accrued liabilities

827,255

678,319 Accrued expenses

1,501,228

1,055,829 Income taxes payable

2,140,064

1,270,862 Notes payable - current portion (Note 10)

14,320

14,182 Total Current Liabilities

4,482,867

3,019,192









Notes payable - long-term portion (Note 10)

921,031

925,890 Notes payable - related party (Note 10)

-

6,526,732 Deferred tax liability

553,856

568,330



1,474,887

8,020,952 Total Liabilities

5,957,754

11,040,144









Shareholders' Equity







Share capital (Note 12)

21,111,565

- Restricted share units (Note 12)

1,446,512

- Warrants (Note 12)

4,247,779

- Contributed surplus (Note 12)

149,622

- Deficit

(5,970,445)

(2,481,274) Total Shareholders' Equity

20,985,032

(2,481,274) Total Liabilities and Shareholders' Equity

26,942,786

8,558,870

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)



Three months

Three months

Six months

Six months



Ended

Ended

Ended

Ended



June 30,

June 30,

June 30,

June 30,



2018

2017

2018

2017 Revenue















Revenues, net of discounts

4,426,197

1,461,782

8,026,679

2,596,215 Gain on Biological Asset Transformation

1,058,531

774,970

3,189,227

2,375,657 Cost of Goods Sold

(3,105,592)

(830,114)

(7,214,697)

(1,450,086) Gross Profit

2,379,136

1,406,638

4,001,209

3,521,786

















Expenses















General and Administrative (Note 11)

1,644,556

589,735

2,755,501

1,021,788 Sales and Marketing

229,363

32,417

334,909

45,808 Depreciation and Amortization

29,077

28,804

61,440

57,239 Non-cash Compensation Expense

1,596,134

-

1,596,134

- Total Expenses

3,499,130

650,956

4,747,983

1,124,835

















Income (Loss) From Operations

(1,119,994)

755,682

(746,774)

2,396,951

















Other (Income) Expense:















Interest Expense, net

121,405

255,218

239,857

488,337 Foreign exchange (gain) loss

266,521

-

266,521

- RTO acquisition costs

532,367

-

532,367

- (Gain) loss on conversion of debt (Note 10)

848,925

-

848,925

- Total Other (Income) Expense

1,769,218

255,218

1,887,669

488,337

















Net loss for the period before tax

(2,889,212)

500,464

(2,634,443)

1,908,614 Provision for tax - current (Note 15)

514,093

478,255

854,728

1,197,406 Net Income (Loss) for the period

(3,403,305)

22,209

(3,489,171)

711,208



































Loss per share for the period















Basic and fully diluted loss per share

($0.04)

na

($0.04)

na

















Weighted Average Number of Shares Outstanding

83,819,620

nil

79,434,174

nil

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS



Six months

Six months



Ended

Ended



June 30,

June 30,



2018

2017 Operating activities







Net loss for the period

(3,489,171)

711,208 Add (deduct) non-cash items:









Non–cash compensation expense

1,596,134

-

Depreciation and amortization

320,227

293,890

Unrealized foreign exchange (gain) loss

138,075

-

Loss on conversion of debt

848,925





Non-cash interest expense

217,048

231,210



(368,763)

1,236,308 Net change in non-cash working capital







Sales tax recoverable

47,060

- Inventory

(217,271)

(460,644) Biological assets

68,926

(2,375,657) Prepaid expenses

(641,272)

- Income tax payable

869,202

389,683 Net change in deferred tax liabilities

(14,474)

977,587 Accounts payable and accrued liabilities

561,182

174,328 Cash flow provided by (used in) operating activities

304,590

(58,395)









Investing activities







Purchase of property, plant and equipment

(1,201,858)

(69,613) Cash flow used in investing activities

(1,201,858)

(69,613)









Financing activities







Issuance of common shares and warrants

19,508,446

- Share and warrant issuance costs

(1,783,390)

- Issuance of long-term debt

-

- Principal repayment on equipment finance lease

(2,721)

(6,922) Repayment of long-term debt

-

- Cash flow provided by (used in) financing activities

17,722,335

(6,922)









Effect of foreign exchange on cash

(202,155)

-









Net increase (decrease) in cash and cash equivalents during the period

16,622,911

(134,930) Cash and cash equivalents at beginning of period

451,869

20,868 Net cash acquired on the RTO acquisition

34,678

- Cash and cash equivalents at end of period

17,109,458

(114,062)











SOURCE Planet 13 Holdings Inc.

For further information: Jonathan Ross, Lode Rock Advisors Inc., Planet 13 Investor Relations, [email protected], 416-283-0178; Robert Groesbeck or Larry Scheffler, Co-Chief Executive Officers, [email protected]

Related Links

https://planet13lasvegas.com/

