TORONTO and RIONEGRO, Colombia , Nov. 25, 2019 /CNW/ - PharmaCielo Ltd. ("PharmaCielo" or the "Company") (TSXV: PCLO, OTC: PHCEF), the Canadian parent of Colombia's premier cultivator and producer of medicinal-grade cannabis oil, PharmaCielo Colombia Holdings S.A.S., today announced financial results for the three- and nine-month periods ended September 30, 2019 .

"As we approach the end of 2019, our team is on track to deliver on the key objectives outlined for shareholders at the time of our public listing in January, positioning PharmaCielo for a strong close to the year and solid growth in 2020," said David Attard , Chief Executive Officer of PharmaCielo Ltd. "Our focus in Q4 and through 2020 will be on a continued ramp up of our processing facilities and on generating  revenue at commercial scale both through the expansion of global sales relationships, and the signing of commercial supply agreements in jurisdictions where we are present today. While it has taken several years to bring our infrastructure and team to this point, I would challenge anybody watching the cannabis space today to identify another company with the capability to consistently produce high quality medicinal-grade cannabis extracts at an immediate capacity of 265 tonnes of dried flower per year, and an all-in cost of $0.04 per grami. Today, we are truly ready to embark on our journey to becoming the world's preferred provider of naturally grown, medicinal-grade cannabis extracts & wellness-related formulations."

Mr. Attard continued, "With many global producers facing oversupply and intransigent per-gram production costs, we see the PharmaCielo model as the future of cannabis. There is substantial operating leverage embedded in this business as start-up expenses begin to roll off. This is a business that can get cash flow positive and generate meaningful profitability as it scales. We are excited to get working with our global customers at scale and to show our shareholders the financial power of the platform we have built as we progress through 2020."

Financial Highlights – Q3 Operating ResultsAll comparisons below are to the quarter ended September 30, 2018 , unless otherwise noted



Q3 Highlights and Recent DevelopmentsFor a more comprehensive overview of these highlights and recent developments, please refer to PharmaCielo's Management's Discussion and Analysis of the Financial Condition and Results of Operations for the Three and Nine Months Ended September 30, 2019 (the "MD&A"). 

The Company's net loss totaled $3.8 million and $22.2 million for the three and nine months ended September 30, 2019 , respectively (compared to $9.6 million and $23.4 million for the three and nine months ended September 30, 2018 , respectively), with a basic loss per share of $0.04 and $0.23 for the three and nine months ended September 30, 2019 , respectively versus a basic loss per share of $0.12 and $0.30 for the three and nine months ended September 30, 2018 , respectively.

This net loss was primarily due to higher professional fees of $1.9 million and $3.3 million for the three and nine months ended September 30, 2019 , respectively (compared to $(22,251) and $1.8 million in the three and nine months ended September 30, 2018 , respectively), higher salaries and wages of $1.0 million and $2.8 million for the three and nine months ended September 30, 2019 , respectively (compared to $218,094 and $595,023 in the three and nine months ended September 30, 2018 , respectively), and higher agricultural pre-operational costs of $121,491 and $2.4 million for the three and nine months ended September 30, 2019 , respectively (compared to $617,926 and $1.5 million in the three and nine months ended September 30, 2018 , respectively). The net loss was partially offset by an unrealized gain in fair value of biological assets of $2.1 million for the three and nine months ended September 30, 2019 (compared to $Nil in the three and nine months ended September 30, 2018 ), and share-based expense of $844,168 and $7.0 million for the three and nine months ended September 30, 2019 , respectively (compared to $8.0 million and $16.5 million in the three and nine months ended September 30, 2018 , respectively).

About PharmaCielo PharmaCielo Ltd. (TSXV:PCLO, OTC:PHCEF) is a global company, headquartered in Canada , with a focus on ethical and sustainable processing and supplying of all natural, medicinal-grade cannabis oil extracts and related products to large channel distributors. PharmaCielo's principal (and wholly owned) subsidiary is PharmaCielo Colombia Holdings S.A.S., headquartered at its cultivation and processing centre located in Rionegro, Colombia .

The boards of directors and executive teams of both PharmaCielo and PharmaCielo Colombia Holdings are comprised of a diversely talented group of international business executives and specialists with relevant and varied expertise. PharmaCielo recognized the significant role that Colombia's ideal location will play in building a sustainable business in the medical cannabis industry, and the Company, together with its directors and executives, is executing on a business plan focused on supplying the international marketplace.

Certain statements contained in this news release, such as those relating to anticipated commercial sales in 2019, growing sales channels, expansion of sales and the Company's operating platform in 2020, product development, the completion of the Colombian processing facility and progressing toward production, and the U.S. market as a prospective market for CBD products in the near-term may contain "forward-looking information" as such term is used in applicable Canadian securities laws. Forward-looking information is based on plans, expectations and estimates of management at the date the information is provided and is subject to certain factors and assumptions, including the ability to obtain all necessary governmental regulatory and TSXV approval related to the exportation of PharmaCielo's CBD products from Colombia , that the Company's financial condition and development plans do not change as a result of unforeseen events, and management's ability to execute its business plan. Forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking information. Factors that could cause the forward-looking information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to prove not to be valid or reliable, that occurrences such as those referred to above are realized and result in delays, or cessation in planned work or construction projects, that the Company's financial condition and development plans change, failure to obtain necessary TSXV or applicable government regulatory approvals, the Company is unable to export or distribute commercial product to its sale channels due to economic or operational circumstances, risks associated with operating in Colombia , and currency exchange risk, as well as the other risks and uncertainties applicable to cannabis producing companies and to the Company. The Company undertakes no obligation to update these forward-looking statements, other than as required by applicable law.

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 press release.

i The Company produced and sold 12 kilogram equivalents during Q3-2019 at an all-in cost of $0.04 per gram of dried cannabis. All-in cost is a non-GAAP measure.

ii Please refer to the Company's condensed interim consolidated financial statements  for the three and nine months ended September 30, 2019, available on SEDAR at www.sedar.com or the Company's website. The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.

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