RIV Capital Ends Q1 2022 With $212.5M On Hand After Announcing $150M Strategic Investment From Scotts Miracle-Gro's Cannabis-Focused Subsidiary

Cannabis-focused venture capital firm RIV Capital Inc. RIV CNPOF, formerly known as Canopy Rivers Inc., reported Monday that it has ended the first quarter of fiscal 2022 with CA$212.5 million ($169.7 million) of cash on hand. This follows a $150 million strategic investment from Scotts Miracle-Gro's SMG newly created cannabis-focused subsidiary, The Hawthorne Collective.

Narbé Alexandrian, president and CEO of the Toronto-based company, called the investment in RIV Capital "the first step in executing on our growth strategy," adding that it "strengthens our balance sheet and leverages RIV Capital's cannabis domain knowledge with ScottsMiracle-Gro's expertise in operations, R&D, sales, and distribution."

Q1 2022 Financial Highlights

Operating income (before equity method investees and fair value changes) totaled CA$0.4 million for the quarter, net of a provision for expected credit losses of CA$0.1 million, compared to CA2.66 million in the first quarter of fiscal 2021.

  • Operating expenses were CA$2.5 million, down from CA$2.67 million in the corresponding quarter of last year.
  • General and administrative expenses were CA$1.7 million for the quarter, up from CA$1.34 million in the same quarter of fiscal 2021.
  • The company's share of loss from equity method investees was CA$0.3 million for the period.
  • Total comprehensive loss totaled CA$30.9 million, compared with a total comprehensive income of CA$7.3 million for the same period last year.

Operational Highlights

Over the quarter, the company made a CA$7.5 million payment in connection with the PharmHouse credit facility that was terminated and canceled upon PharmHouse's sale of its greenhouse facility to reduce the amount it owns.

RIV Capital also settled a CA$17.6 million tax liability, primarily related to the capital gains realized on the transaction between RIV Capital and Canopy Growth Corporation CGC WEED that closed in February 2021. The Canadian cannabis giant gave up on its interest in Canopy Rivers earlier this year. The Toronto-based cannabis-focused venture capital firm opted to transfer three of its portfolio assets to Canopy Growth for $115 million in cash and 3.75 million of Canopy Growth's common shares in exchange.

Photo: Courtesy of Tim Foster on Unsplash

Posted In: first quarter earningsNarbe AlexandrianCannabisEarningsNewsPenny StocksFinancingMarkets

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