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Grove, Inc. (GRVI) SEC Filing 10-Q Quarterly Report for the period ending Thursday, September 30, 2021

Grove, Inc.

CIK: 1775194 Ticker: GRVI

EXHIBIT 99.1

 

Grove, Inc. Announces Fiscal Year 2021 Audited Financial Results

Revenues Reach $24.1 Million, a 250% Increase Over 2020

Net earnings of $2.9 Million or $.25 per share

 

HENDERSON, NV / September 29, 2021 / Grove, Inc. (NASDAQ:GRVI) ("Grove" or the "Company"), a global innovator in hemp, health, and wellness, today announced audited financial results for its fiscal year ended June 30, 2021 which surpassed preliminary results issued on June 28, 2021. Investors are encouraged to read the Company’s annual report on Form 10-K which was filed with the Securities and Exchange Commission (the “SEC”), contains additional information, and is posted at https://groveinc.io/

 

Financial Highlights

 

 

·

$24.1 million in revenue

 

·

$2.9 million in net income

 

·

$0.25 basic earnings per share

 

·

$2.9 million in cash flow provided by operations

 

·

$3.2 million in adjusted EBITDA

 

·

Strong Margin expansion quarter over quarter

 

·

Strong Revenue growth Quarter over Quarter

 

·

4th Quarter revenues of 10.64M surpassed a 361% growth over 4th quarter revenues in the prior year

   

Allan Marshall, Chief Executive Officer of Grove, stated, “Our team surpassed every internal and external projection for revenue growth, income growth, earnings per share and customer acquisition numbers. We finished the year with exceptional growth and significant momentum in the second half of the year. Our team has found a way to grow while maintaining profits in an industry that historically has not been able to produce these types of results. We enter 2022 with momentum and look to continue our outperformance in the current year”

 

Andrew Norstrud, Chief Financial Officer of Grove, stated, “Cash flow quarter over quarter exceeded our projections and ended with our strongest quarter to date. The company finished the quarter with $14.5 million in cash and minimal debt that has since been paid. The balance sheet is strong with net working capital of $12.5 million and stockholders’ equity of $21.2 million. The company’s financial position strengthened every quarter and we finished with great momentum.”

 

 
1

 

 

Liquidity and Capital Resources

 

Working Capital

 

 

 

As of

June 30, 2021

 

 

As of

June 30, 2020

 

Current assets

 

$ 18,293,083

 

 

$ 2,649,674

 

Current liabilities

 

$ 5,819,161

 

 

$ 3,519,434

 

Working capital

 

$ 12,473,922

 

 

$ (869,760 )

 

Cash Flows

 

 

 

Years Ended June 30,

 

 

 

2021

 

 

2020

 

Cash flows provided by (used in) operating activities

 

$ 2,939,306

 

 

$ (4,164,746 )

Cash flows used in investing activities

 

 

(1,281,007 )

 

 

(1,462,915 )

Cash flows provided by financing activities

 

 

11,988,395

 

 

 

2,817,746

 

Net increase (decrease) in cash during period

 

$ 13,646,694

 

 

$ (2,809,915 )

 

At June 30, 2021, the Company had cash of $14,534,211 or an increase of $13,646,694 from June 30, 2020. The increase of cash provided by operating activities is primarily related to the net income and the sale of the Company common stock.

 

About Grove, Inc.

 

Grove, Inc. is in the business of developing, producing, marketing and selling quality products and end consumer products containing the industrial hemp plant extract Cannabidiol (“CBD”), as well as diversified products in other verticals . The Company sells to numerous consumer markets including the botanical, beauty care, pet care and functional food sectors. It seeks to take advantage of an emerging worldwide trend to re-energize the production of industrial hemp and to foster its many uses for consumers.

 

Company Contact

 

Andrew Norstrud

Email: investorinfo@cbd.io

Phone: (702) 332-5591

 

Investor Relations Contact

 

TraDigital IR

John McNamara

Email: john@tradigitalir.com

Phone: (917) 658-2602

 

 
2

 

 

Forward-Looking Statements

 

This press release contains statements that constitute "forward-looking statements," including with respect to the Company's business strategy, product development and industry trends. No assurance can be given that the offering will be completed on the terms described, or at all. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company, including those set forth in the Risk Factors section of the Company's registration statement and preliminary prospectus for the offering filed with the SEC. Copies are available on the SEC's website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.

 

Use of Non-GAAP Financial Measures

 

The Company discloses and uses the above-mentioned non-GAAP financial measures internally as a supplement to GAAP financial information to evaluate its operating performance, for financial planning purposes, to establish operational goals, for compensation plans, to measure debt service capability, for capital expenditure planning and to determine working capital needs and believes that these are useful financial measures also used by investors. Non-GAAP adjusted EBITDA is defined as GAAP net income or net loss before interest, taxes, depreciation and amortization (EBITDA) adjusted for the non-cash stock compensation and stock option expense, acquisition, integration & restructuring expenses, charges and gains or losses from extinguishment of debt and other non-cash items. Non-GAAP EBITDA and non-GAAP adjusted EBITDA are not terms defined by GAAP and, as a result, the Company’s measure of non-GAAP EBITDA and non-GAAP adjusted EBITDA might not be comparable to similarly titled measures used by other companies. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flow that either excludes or includes amounts that are not normally included in the most directly comparable measure calculated and presented in accordance with GAAP. The non-GAAP financial measures discussed above, however, should be considered in addition to, and not as a substitute for, or superior to net income or net loss as reported for GAAP on the Consolidated Statements of Operations, cash and cash flows on the Consolidated Statement of Cash Flows or other measures of financial performance prepared in accordance with GAAP, and as reflected on the Company’s financial statements prepared in accordance with GAAP. These non-GAAP financial measures are not a substitute for or presented in lieu of financial measures provided by GAAP and all measures and disclosures of financial information pursuant to GAAP should be read to obtain a comprehensive and thorough understanding of the Company’s financial results. The reconciliations of non-GAAP EBITDA and non-GAAP adjusted EBITDA to GAAP operating income (loss) and/or GAAP net income (net loss) referred to in the highlights or elsewhere are provided in the schedules that are a part of this document.

 

Reconciliation of Non-GAAP Adjusted EBITDA to GAAP Net Income (Net Loss)

Year Ended June 30,

 

 

 

 

 

 

 

2021

 

 

2020

 

Net income (Net loss) GAAP

 

$ 2,978,948

 

 

$ (5,383,673 )

Income tax

 

 

(1,282,815 )

 

 

-

 

Interest expense, net

 

 

530,449

 

 

 

138,406

 

Depreciation and amortization

 

 

1,030,021

 

 

 

611,346

 

Stock compensation

 

 

738,932

 

 

 

372,770

 

Impairment of lease cancellation

 

 

-

 

 

 

588,347

 

Gain on lease settlement

 

 

(387,860 )

 

 

-

 

Gain on SBA PPP loan extinguishment

 

 

(403,277 )

 

 

-

 

Gain on sale of asset

 

 

(8,708 )

 

 

(180,211 )

Non-GAAP adjusted EBITDA

 

$ 3,195,690

 

 

$ (3,853,015 )

 

 
3

 

 

Grove Inc

Consolidated Balance Sheets

 

 

 

June 30,

 

 

June 30,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash

 

$ 14,534,211

 

 

$ 887,517

 

Accounts receivable, net of allowance for doubtful accounts of $57,500 and $10,000, respectively

 

 

1,277,662

 

 

 

165,147

 

Inventory

 

 

2,094,952

 

 

 

1,448,448

 

Prepaid expenses and other current assets

 

 

386,258

 

 

 

148,562

 

Total current assets

 

 

18,293,083

 

 

 

2,649,674

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

2,832,400

 

 

 

1,687,273

 

Intangible assets, net

 

 

1,845,166

 

 

 

1,240,260

 

Goodwill

 

 

2,413,813

 

 

 

493,095

 

Deferred tax asset

 

 

1,403,591

 

 

 

-

 

Other assets

 

 

49,068

 

 

 

37,068

 

Right-of-use asset

 

 

417,443

 

 

 

294,835

 

Total other assets

 

 

8,961,481

 

 

 

3,752,531

 

 

 

 

 

 

 

 

 

 

Total assets

 

$ 27,254,564

 

 

$ 6,402,205

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$ 1,604,723

 

 

$ 484,333

 

Accrued compensation

 

 

1,020,936

 

 

 

195,399

 

Deferred revenue

 

 

485,973

 

 

 

473,320

 

Accrued liabilities

 

 

296,021

 

 

 

221,664

 

Acquisition payable

 

 

1,764,876

 

 

 

-

 

Current portion of notes payable

 

 

447,100

 

 

 

183,595

 

Convertible notes payable

 

 

-

 

 

 

1,500,000

 

Current portion of operating lease payable

 

 

199,532

 

 

 

461,123

 

Total current liabilities

 

 

5,819,161

 

 

 

3,519,434

 

 

 

 

 

 

 

 

 

 

Notes payable, net of current portion

 

 

-

 

 

 

365,350

 

Operating lease payable, net of current portion

 

 

217,430

 

 

 

338,040

 

Total long-term liabilities

 

 

217,430

 

 

 

703,390

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Stockholders' equity

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value, 100,000,000 shares authorized, and 500,000 and 0 shares issued and outstanding, respectively

 

 

500

 

 

 

-

 

Common stock, $0.001 par value, 100,000,000 shares authorized, and 15,262,394 and 10,222,223 shares issued and outstanding, respectively

 

 

15,262

 

 

 

10,223

 

Additional paid in capital

 

 

25,372,247

 

 

 

7,314,341

 

Accumulated deficit

 

 

(4,170,036 )

 

 

(7,098,984 )

Total stockholders' equity attributable to Grove, Inc.

 

 

21,217,973

 

 

 

225,580

 

Non-controlling interest in subsidiary

 

 

-

 

 

 

1,953,801

 

Total stockholders' equity

 

 

21,217,973

 

 

 

2,179,381

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$ 27,254,564

 

 

$ 6,402,205

 

 

 
4

 

 

Grove Inc.

Consolidated Statements of Operations

 

 

 

Year Ended June 30,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

Product revenue

 

 

24,095,025

 

 

 

6,159,013

 

Trade show revenue

 

 

-

 

 

 

1,253,847

 

 

 

 

24,095,025

 

 

 

7,412,860

 

 

 

 

 

 

 

 

 

 

Product costs

 

 

12,196,123

 

 

 

4,280,909

 

Trade show costs

 

 

-

 

 

 

561,988

 

 

 

 

12,196,123

 

 

 

4,842,897

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

11,898,902

 

 

 

2,569,963

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

Sales and marketing

 

 

2,388,211

 

 

 

1,370,964

 

General and administrative expenses

 

 

8,083,954

 

 

 

6,037,329

 

 

 

 

10,472,165

 

 

 

7,408,293

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

1,426,737

 

 

 

(4,838,330 )

 

 

 

 

 

 

 

 

 

Other expense (income), net

 

 

 

 

 

 

 

 

Interest expense (income), net

 

 

530,449

 

 

 

138,406

 

Gain on sale of assets

 

 

(8,708 )

 

 

(180,211 )

Gain on SBA PPP loan extinguishment

 

 

(403,277 )

 

 

-

 

Settlement of cancelled lease

 

 

(387,860 )

 

 

-

 

Impairment of cancelled lease expense

 

 

-

 

 

 

588,347

 

 

 

 

 

 

 

 

 

 

Other expense (income), net

 

 

(269,396 )

 

 

546,542

 

 

 

 

 

 

 

 

 

 

Income (loss) before income tax

 

 

1,696,133

 

 

 

(5,384,872 )

 

 

 

 

 

 

 

 

 

Income tax benefit (expense)

 

 

1,282,815

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

2,978,948

 

 

 

(5,384,872 )

Net loss attributable to noncontrolling interest

 

 

-

 

 

 

(1,199 )

Deemed dividend related to the issuance of Series A Preferred Stock

 

 

(50,000 )

 

 

-

 

Net income (loss) attributable to Grove, Inc.

 

$ 2,928,948

 

 

$ (5,383,673 )

 

 

 

 

 

 

 

 

 

Basic income (loss) per share

 

$ 0.25

 

 

$ (0.53 )

 

 

 

 

 

 

 

 

 

Diluted income (loss) per share

 

$ 0.21

 

 

$ (0.53 )

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

11,930,378

 

 

 

10,097,075

 

 

 

 

 

 

 

 

 

 

Fully diluted weighted average shares outstanding

 

 

14,257,934

 

 

 

10,097,075

 

 

 
5

The following information was filed by Grove, Inc. (GRVI) on Wednesday, September 29, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside this 10-Q Quarterly Report

Cover
Consoldiated Balance Sheets
Consoldiated Balance Sheets (Parenthetical)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Operations
Consolidated Statements Of Stockholders' Equity (Unaudited)
Accrued Liabilities
Accrued Liabilities (Details)
Accrued Liabilities (Table)
Acquisition
Acquisition (Details 1)
Acquisition (Details Narrative)
Acquisition (Details)
Acquisition (Table)
Background Information
Convertible Promissory Notes And Notes Payable
Convertible Promissory Notes And Notes Payable (Details 1)
Convertible Promissory Notes And Notes Payable (Details Narrative)
Convertible Promissory Notes And Notes Payable (Details)
Convertible Promissory Notes And Notes Payable (Table)
Equity Transactions
Equity Transactions (Details Narrative)
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Details 1)
Goodwill And Intangible Assets (Details 2)
Goodwill And Intangible Assets (Details Narrative)
Goodwill And Intangible Assets (Details)
Goodwill And Intangible Assets (Table)
Income Taxes
Income Taxes (Details Narrative)
Inventory
Inventory (Details Narrative)
Inventory (Details)
Inventory (Table)
Operating Leases
Operating Leases (Details 1)
Operating Leases (Details 2)
Operating Leases (Details Narrative)
Operating Leases (Details)
Operating Leases (Table)
Prepaid Expense And Other Current Assets
Prepaid Expense And Other Current Assets (Details)
Prepaid Expense And Other Current Assets (Table)
Property And Equipment
Property And Equipment (Details Narrative)
Property And Equipment (Details)
Property And Equipment (Table)
Related Party Transactions
Related Party Transactions (Details Narrative)
Risks And Uncertainties
Stock Based Compensation
Stock Based Compensation (Details 1)
Stock Based Compensation (Details Narrative)
Stock Based Compensation (Details)
Stock Based Compensation (Table)
Subsequent Events
Subsequent Events (Details Narrative)

Material Contracts, Statements, Certifications & more

Grove, Inc. provided additional information to their SEC Filing as exhibits

Ticker: GRVI
CIK: 1775194
Form Type: 10-Q Quarterly Report
Accession Number: 0001477932-21-008204
Submitted to the SEC: Mon Nov 15 2021 9:16:58 AM EST
Accepted by the SEC: Mon Nov 15 2021
Period: Thursday, September 30, 2021
Industry: Medicinal Chemicals And Botanical Products

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