GreenSpace Brands Inc. (formerly Life Choices Natural Foods Corp.) Reports Record Fourth Quarter Revenue Growth of 185%

TORONTO, July 27, 2015 /CNW/ - Life Choices Natural Foods Corp. (the "Company") today reported its financial results for the three and twelve months ended March 31, 2015.

Consolidated Performance Summary




 Three months ended

      March 31,

   Twelve months ended

      March 31,

(Amounts in thousands of Cdn, except per share)

2015

2014

2015

2014


$

$

$

$






Revenue

1,433

503

3,634

1,694

Gross profit

283

164

603

347

Gross profit margin

19.8%

32.6%

16.6%

20.5%






SG&A expenses

1,021

285

2,122

882

Interest and accretion expense

60

15

128

31






Net loss from continuing operations

(798)

(136)

(1,651)

(565)

Net loss from discontinued operations, net of tax 

-

(12)

(2)

(35)






Net loss

(798)

(148)

(1,653)

(600)

Net loss per share (basic and diluted)

(0.24)

(0.05)

(0.57)

(0.25)






Adjusted EBITDA1

(541)

(133)

(1,326)

(570)

Adjusted EBITDA Margin1

(50.1%)

(26.5%)

(36.5%)

(33.6%)

The fourth quarter and year-to-date sales results for the Company were strong, showing a 185.2% increase in the quarter and 114.5% increase year-to-date over 2014. These sales increases were primarily the result of the Company launching two new brands, Rolling Meadow and Holistic Choice, and the Company continuing to gain momentum under its Life Choices Natural Food brand as a result of new distribution channels and new product offerings.

Gross profit margins in the quarter and year-to-date were slightly lower, as expected, due to a larger proportion of sales coming from Rolling Meadow milk products, increased trade spending to launch the two new brands and unusually high levels of inventory write-offs as customer demand on these new brands was established. Normalizing for the unexpectedly high levels of inventory write-offs management believes margins in the quarter and year-to-date would have improved by 6.8% and 7.5%, respectively.

As the Company is actively promoting a number of new brands and building its infrastructure for future growth it's not unexpected that SG&A expenses in both the fourth quarter and year-to-date 2015 were higher than prior year. SG&A expenses were incurred to promote and advertise for the new brand launches, were incurred on professional services to complete the Company's Qualifying Transaction and initial public offering and were incurred to build the Company's infrastructure and put a talented team in place which will allow for future growth without significant headcount additions.

Definitive Agreement
On April 13, 2015, Life Choices Natural Foods Corp. entered into a definitive agreement and completed a three-corner amalgamation with Aumento Capital IV Corporation ("Aumento") and Aumento Subco a wholly-owned subsidiary to form GreenSpace Brands Inc. ("GreenSpace") (TSXV: JTR (Join The Revolution)).

Outlook
Management believes there are a number of fundamental trends which continue to drive demand for the Company's products. As reported by the 2014 NPN Journal Industry Report the U.S. organic food and beverage market grew at a rate of 11.8% through fiscal 2014 and the global organic food and beverage market is expected to grow at a cumulative average growth rate of 15.7% over the next 6 years.

Management is optimistic that this anticipated growth in the organic food and beverage market will continue to drive demand for the Company's developed products and provides a lot of opportunity for further expansion of the existing product segments in the future. This fundamental market growth is further supported by the Company's strong customer relationships, existing extensive distribution networks, well recognized and respected brands and efficient operations. The combination of our inherent Company strengths and exposure to these growing markets provide good fundamentals to support long-term growth, both on current brands in market and brands yet to be launched. In particular, management believes it is one of very few companies positioned to capitalize on the emerging grass-fed trend. Through its dairy brand, Rolling Meadow, and the Life Choices brand, the Company has carved out a niche in the Canadian grass-fed market which it hopes to exploit with continued product and brand launches. Through fiscal 2016, Management will engage in marketing efforts with a view to achieving revenue and gross margin growth. In doing so, management believes that the Company will be well positioned for profitability and positive operating cash flows in the future. 

In addition to internal brand/product launches, a number of strategic acquisitions are currently being explored and Management is confident that all of these targets would be accretive and have synergies with the Company's existing business, should the proposed transactions move forward. Management feels it is in a strong position to be one of the principle industry consolidators, due to the collective industry contacts and accumulated goodwill of Management in the North American Natural Food Industry. 

About GreenSpace Brands Inc
GreenSpace develops, markets and sells premium convenience natural food products to consumers across Canada.  Greenspace's original brand, 'Life Choices' features premium convenience meat products made with a variety of combinations of grass fed and pasture raised meats (meat raised without the use of added hormones and antibiotics). Life Choices owns Rolling Meadow Dairy (Canada's first grass fed dairy product line), Holistic Choice (a natural pet food line) and Yamba Yogurts (an Australian style yogurt line).  All brands are wholly owned and retail in a variety of natural and mass retail grocery locations across Canada. For more information, visit www.greenspacebrands.ca

Forward-Looking Statements
Certain statements in this MD&A constitute forward-looking statements within the meaning of applicable securities laws.  Forward-looking statements include, but are not limited to, statements made under the heading "Outlook" and other statements concerning the Company's 2016 objectives, strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts.  Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans" or "continue", or similar expressions suggesting future outcomes or events.  Such forward-looking statements reflect management's current beliefs and are based on information currently available to management.  Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated by such statements.  Factors that could cause such differences include the cyclical nature of the construction and agriculture industries, changes in general economic conditions and interest rates, adverse weather, cost and availability of materials used to manufacture the Company's products, competitive developments, as well as other risk factors included in this MD&A under the heading "Risks and Uncertainties" and as described from time to time in the reports and disclosure documents filed by the Company with Canadian securities regulatory agencies and commissions.  This list is not exhaustive of the factors that may impact the Company's forward-looking statements.  These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements.  As a result of the foregoing and other factors, no assurance can be given as to any such future results, levels of activity or achievements or levels of dividends and neither the Company nor any other person assumes responsibility for the accuracy and completeness of these forward looking statements.  The factors underlying current expectations are dynamic and subject to change.  Although the forward-looking information contained in this MD&A is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements.  Certain statements included in this MD&A may be considered "financial outlook" for purposes of applicable securities laws, and such financial outlook may not be appropriate for purposes other than this MD&A.  All forward-looking statements in this MD&A are qualified by these cautionary statements.  The forward-looking statements contained herein are made as of the date of this MD&A and except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

__________________________________________________
1 Non-IFRS Measure - See disclosure on non-IFRS measures detailed in the Company's publicly disclosed Management Discussion and Analysis (MD&A). The MD&A and all required disclosure and reconciliations for these non-IFRS measures can be found on the Company's webpage – www.greenspacebrands.ca or within the Company's MD&A filed on SEDAR.

SOURCE GreenSpace Brands Inc.

Image with caption: "GreenSpace Brands Inc. (CNW Group/GreenSpace Brands Inc.)". Image available at: http://photos.newswire.ca/images/download/20150727_C4893_PHOTO_EN_459692.jpg

For further information: Matthew von Teichman, President & Chief Executive Officer, GreenSpace Brands Inc., Tel: (416) 934-5034 Ext. 235; Mathew Walsh, Chief Financial Officer, GreenSpace Brands Inc., Tel: (416) 934-5034 Ext. 222

RELATED LINKS
www.greenspacebrands.ca

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