TORONTO--(BUSINESS WIRE)--Jamieson Wellness Inc. (“Jamieson Wellness” or the “Company”) (TSX: JWEL) today reported financial results for its first quarter ended March 31, 2022. All amounts are expressed in Canadian dollars. Certain metrics, including those expressed on an adjusted basis, are non-IFRS and other financial measures. See “Non-IFRS and Other Financial Measures” below.
Highlights of First Quarter 2022 Results versus First Quarter 2021 Results
- Revenue increased 5.5% to $103.7 million;
- Jamieson Brands revenue increased by 9.6%;
- Adjusted EBITDA(1) increased 13.0% to $20.9 million;
- Net earnings increased 58.8% to $9.7 million and Adjusted net earnings(1) increased 24.4% to $10.7 million; and
- Diluted earnings per share were $0.23, and Adjusted diluted earnings per share(2) increased 23.8% to $0.26.
“We delivered another solid quarter led by revenue growth in Jamieson Brands, reflecting the strength of our growing global platform and consistent execution by our team,” said Mike Pilato, President and CEO of Jamieson Wellness. “Demand remains strong across our portfolio as consumers continue to seek high-quality brands and innovative solutions to optimize their health and wellness needs. Jamieson Brands revenue was up nearly 9% in Canada and 14% internationally, further reinforcing our ability to grow from our strengthened consumer baseline. The breadth of our business across channels and geographies remains a competitive advantage, creating multiple pathways for expansion as well as mitigating risk and helping to drive profitable results. Our 13% increase in Adjusted EBITDA during the first quarter underscores this point given the inflationary challenges related to supply chain and transportation costs. We remain confident in our ability to deliver our 2022 expectations, while navigating continued environmental uncertainties and driving value for all of our stakeholders.”
First Quarter 2022 Results
Revenue increased 5.5% to $103.7 million in the first quarter of 2022 compared with $98.3 million in the first quarter of 2021 driven by 9.6% growth in the Jamieson Brands segment, partially offset by an 8.4% decline in the Strategic Partners segment.
Revenue in the Jamieson Brands segment increased by 9.6% or $7.3 million to $83.2 million. The Company’s domestic branded sales increased by 8.9% in the first quarter of 2022, reflecting strong point of purchase sales, timing of sales to support seasonal promotional activities, and pricing. The Company’s international USD denominated revenue(3) increased by 12.4% on a constant currency basis, or 13.5% on a reported basis compared with the first quarter of 2021 led by continued growth in China while overlapping significant growth from strong non-immunity shipments during the same period in the prior year. Prior year shipments were impacted by the replenishment of back-orders which caused underlying shipment patterns to misalign with consumption patterns.
Revenue in the Strategic Partners segment decreased by 8.4%, or $1.9 million to $20.5 million in the first quarter of 2022 reflecting order timing while overlapping prior year’s significant growth of almost 52% as we attempt to more evenly distribute Strategic Partner demand throughout the year.
Gross profit increased by $4.1 million to $37.9 million in the first quarter of 2022 mainly driven by revenue growth and improved operating efficiencies in the Jamieson Brands segment. Normalized gross profit margin(2) increased by 160 basis points to 36.6%, reflecting margin improvements in our Jamieson Brands segment and the mix impact of its proportionally higher Branded sales, partially offset by lower margin in our Strategic Partners segment. Normalized gross profit margin in the Jamieson Brands segment increased by 120 basis points to 42.8% due to operating efficiencies and volume growth driving leverage on our manufacturing assets, partially offset by temporary elevated costs reflecting ongoing global supply chain challenges and sustained pandemic related safety measures. Gross profit margin(3) in Strategic Partners decreased by 130 basis points to 11.4% mainly due to production volume timing and planned customer mix.
Selling, general and administrative (“SG&A”) expenses increased by $0.9 million to $21.6 million in the first quarter of 2022. Normalized SG&A expenses(1) increased $1.4 million to $20.7 million in the first quarter of 2022 due to additional resources in support of our international expansion and marketing investments for our 100 Years of Wellness campaign.
Earnings from operations increased by $4.7 million, or 44.3%, to $15.2 million in the first quarter of 2022 and operating margin(3) increased by 3.9% to 14.6% due to factors impacting gross profit margin discussed above and lower fixed costs as a percentage of revenue. Normalized earnings from operations(1) increased by $3.6 million, or 28.8% in the first quarter of 2022 and normalized operating margin(2) was 15.5% compared with 12.7% in the first quarter of 2021.
Adjusted EBITDA increased by 13.0% to $20.9 million in the first quarter of 2022 and adjusted EBITDA margin(2) was 20.2% compared with 18.9% in the first quarter of 2021.
Interest expense and other financing costs decreased by $0.1 million to $1.3 million due to lower average borrowings in the quarter.
Net earnings for the first quarter of 2022 was $9.7 million compared with $6.1 million in the first quarter of 2021. Adjusted net earnings, which excludes all non-operating expenses and foreign exchange, increased by $2.1 million, or 24.4%, to $10.7 million in the first quarter of 2022.
Adjusted net earnings excludes costs associated with foreign exchange loss, IT system improvements, business integration, COVID-19 related costs, other non-operating earnings or expenses net of related tax effects. A quantitative reconciliation of reported net earnings to EBITDA, Adjusted EBITDA, and non-IFRS Adjusted net earnings is included in the table accompanying this release under the heading “Non-IFRS and Other Financial Measures”.
Balance Sheet & Cash Flow
The Company generated $17.1 million in cash from operations during the first quarter of 2022 compared with cash used of $5.1 million in the first quarter of 2021. Cash from operating activities before working capital considerations(1) of $15.3 million was $3.4 million higher due to increased earnings in the current quarter. Cash from working capital increased by $18.8 million driven by timing of collection and a slight reduction of our accelerated inventory purchases in Q1 2021. The Company’s cash as at March 31, 2022 was $5.4 million compared with $6.8 million on December 31, 2021 and $8.8 million at the end of the first quarter of 2021. The Company ended the quarter with approximately $140.4 million in cash and available operating lines and net debt of $134.6 million (1).
| Three months ended | ||||||||||||
| March 31 | ||||||||||||
| ($ in 000's, except as otherwise noted) | 2022 |
2021 |
$ Change | % Change | ||||||||
| Cash, beginning of period | 6,775 |
|
1,166 |
|
5,609 |
|
481.0 |
% |
||||
| Cash flows from (used in): | ||||||||||||
| Operating activities | 17,088 |
|
(5,064 |
) |
22,152 |
|
437.4 |
% |
||||
| Investing activities | (3,656 |
) |
(3,606 |
) |
(50 |
) |
(1.4 |
%) |
||||
| Financing activities | (14,775 |
) |
16,270 |
|
(31,045 |
) |
(190.8 |
%) |
||||
| Cash, end of period | 5,432 |
|
8,766 |
|
(3,334 |
) |
(38.0 |
%) |
||||
| Cash flows from operating activities | 17,088 |
|
(5,064 |
) |
22,152 |
|
437.4 |
% |
||||
| Net Change in non-cash working capital | (1,782 |
) |
16,993 |
|
(18,775 |
) |
(110.5 |
%) |
||||
| Cash from operating activities before working capital considerations | 15,306 |
|
11,929 |
|
3,377 |
|
28.3 |
% |
||||
| ($ in 000's, except as otherwise noted) | As at March 31, 2022 |
As at December 31, 2021 |
||||
| Long-term debt | 140,055 |
|
149,125 |
|
||
| Cash | (5,432 |
) |
(6,775 |
) |
||
| Net debt | 134,623 |
|
142,350 |
|
||
Maintaining Fiscal 2022 Outlook
The Company is maintaining its outlook for fiscal 2022 and continues to anticipate revenue in a range of $474.0 to $491.0 million, which represents annual growth of 5.0% to 9.0%. The Company estimates Adjusted EBITDA in a range of $108.0 to $112.0 million and Adjusted diluted earnings per share in a range of $1.42 to $1.48.
For additional details on the Company’s fiscal 2022 outlook, including guidance for the second quarter of 2022, refer to the “Outlook” section in the management’s discussion and analysis of financial condition and results of operations (“MD&A”) for the three months ended March 31, 2022.
Declaration of First Quarter Dividend
On May 4, 2022, the board of directors of the Company declared a cash dividend for the first quarter of 2022 of $0.15 per common share, or approximately $6.1 million in the aggregate. The dividend will be paid on June 15, 2022 to all common shareholders of record at the close of business on May 31, 2022. The Company has designated this dividend as an “eligible dividend” for the purposes of the Income Tax Act (Canada).
Consolidated Financial Statements and Management’s Discussion and Analysis
The Company’s unaudited condensed consolidated interim financial statements and accompanying notes as at and for the three months ended March 31, 2022 and related MD&A are available under the Company’s profile on SEDAR at www.sedar.com and on the Investor Relations section of the Company’s website at https://investors.jamiesonwellness.com.
Conference Call
Management will host a conference call to discuss the Company’s first quarter 2022 results at 5:00 p.m. ET today, May 5, 2022. The call can be accessed live over the telephone by dialing 1-866-575-6539 from Canada and the U.S. or 1-323-794-2551 from international locations. A replay will be available shortly after the call and can be accessed by dialing 1-844-512-2921 from Canada and the U.S. or 1-412-317-6671 from international locations. The passcode for the replay is 4741373 and it will be available until Thursday, May 19, 2022.
Interested parties may listen to a simultaneous webcast of the conference call by logging on via the Investor Relations section of the Company's website at https://investors.jamiesonwellness.com or directly at https://viavid.webcasts.com/starthere.jsp?ei=1542384&tp_key=ff0ec5572d. A replay of the webcast will be available for approximately 30 days following the call.
About Jamieson Wellness
Jamieson Wellness is dedicated to improving the world's health and wellness with its portfolio of innovative natural health brands. Established in 1922, Jamieson is the Company's heritage brand and Canada's #1 consumer health brand. Jamieson Wellness also offers a variety of sports nutrition products and specialty supplements under its Progressive, Smart Solutions, Iron Vegan and Precision brands. For more information please visit jamiesonwellness.com.
Jamieson Wellness’ head office is located at 1 Adelaide Street East Suite 2200, Toronto, Ontario, Canada.
Forward-Looking Information
This press release may contain forward-looking information within the meaning of applicable securities legislation. Such information includes, but is not limited to, statements related to the Company’s anticipated results and its outlook for its 2022 revenue, Adjusted EBITDA and Adjusted diluted earnings per share. Words such as “expect”, “anticipate”, “intend”, “may”, “will”, “estimate” and variations of such words and similar expressions are intended to identify such forward-looking information. This information reflects the Company’s current expectations regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, the factors discussed under “Risk Factors” in the Company’s Annual Information Form dated March 29, 2022 and under the “Risk Factors” section in the MD&A filed today, May 5, 2022. This information is based on the Company’s reasonable assumptions and beliefs in light of the information currently available to it and the statements are made as of the date of this press release. The Company does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law or regulatory authority.
The Company cautions that the list of risk factors and uncertainties is not exhaustive and other factors could also adversely affect the Company’s results. Readers are urged to consider the risks, uncertainties and assumptions associated with these statements carefully in evaluating the forward-looking information and are cautioned not to place undue reliance on such information. See “Forward-looking Information” and “Risk Factors” within the MD&A for a discussion of the uncertainties, risks and assumptions associated with these statements.
_____________
(1) This is a non-IFRS financial measure. See the “ Non-IFRS and Other Financial Measures” section of this press release for more information on each non-IFRS financial measure.
(2) This is a non-IFRS ratio. See the “Non-IFRS and Other Financial Measures” section of this press release for more information on each non-IFRS ratio.
(3) This is a supplementary financial measure. See the “Non-IFRS and Other Financial Measures” section of this press release for more information on each supplementary financial measure.
Jamieson Wellness Inc.
|
||||||
| Three months ended March 31 |
||||||
2022 |
2021 |
|||||
| Revenue | 103,675 |
|
98,270 |
|
||
| Cost of sales | 65,728 |
|
64,382 |
|
||
| Gross profit | 37,947 |
|
33,888 |
|
||
| Gross profit margin | 36.6 |
% |
34.5 |
% |
||
| Selling, general and administrative expenses | 21,620 |
|
20,766 |
|
||
| Share-based compensation | 1,142 |
|
2,602 |
|
||
| Earnings from operations | 15,185 |
|
10,520 |
|
||
| Operating margin | 14.6 |
% |
10.7 |
% |
||
| Foreign exchange loss | 463 |
|
16 |
|
||
| Interest expense and other financing costs | 1,278 |
|
1,415 |
|
||
| Income before income taxes | 13,444 |
|
9,089 |
|
||
| Provision for income taxes | 3,703 |
|
2,953 |
|
||
| Net earnings | 9,741 |
|
6,136 |
|
||
| Adjusted net earnings | 10,744 |
|
8,636 |
|
||
| EBITDA (1) | 18,438 |
|
13,953 |
|
||
| Adjusted EBITDA | 20,945 |
|
18,542 |
|
||
| Adjusted EBITDA margin | 20.2 |
% |
18.9 |
% |
||
| Weighted average number of shares | ||||||
| Basic | 40,442,265 |
|
39,889,792 |
|
||
| Diluted | 41,731,184 |
|
41,507,592 |
|
||
| Earnings per share attributable to common shareholders: | ||||||
| Basic, earnings per share | 0.24 |
|
0.15 |
|
||
| Diluted, earnings per share | 0.23 |
|
0.15 |
|
||
| Adjusted diluted, earnings per share | 0.26 |
|
0.21 |
|
||
(1) This is a non-IFRS financial measure. See the “Non-IFRS and Other Financial Measures” section of this press release for more information on each non-IFRS financial measure.
Jamieson Wellness Inc.
|
||||
|
||||
| March 31, 2022 |
December 31, 2021 |
|||
| Assets | ||||
| Current assets | ||||
| Cash | 5,432 |
6,775 |
||
| Accounts receivable | 90,219 |
104,186 |
||
| Inventories | 131,869 |
119,006 |
||
| Derivatives | 5,378 |
2,149 |
||
| Prepaid expenses and other current assets | 5,064 |
5,029 |
||
237,962 |
237,145 |
|||
| Non-current assets | ||||
| Property, plant and equipment | 97,856 |
96,977 |
||
| Goodwill | 122,975 |
122,975 |
||
| Intangible assets | 191,733 |
192,676 |
||
| Deferred income tax | 2,768 |
2,702 |
||
| Total assets | 653,294 |
652,475 |
||
| Liabilities | ||||
| Current liabilities | ||||
| Accounts payable and accrued liabilities | 74,638 |
74,533 |
||
| Income taxes payable | 3,458 |
2,896 |
||
| Derivatives | 3,122 |
3,317 |
||
| Current portion of long-term debt | 2,850 |
2,876 |
||
84,068 |
83,622 |
|||
| Long-term liabilities | ||||
| Long-term debt | 140,055 |
149,125 |
||
| Post-retirement benefits | 3,629 |
3,544 |
||
| Deferred income tax | 54,904 |
53,291 |
||
| Other long-term liabilities | 20,126 |
20,872 |
||
| Total liabilities | 302,782 |
310,454 |
||
| Shareholders' equity | ||||
| Share capital | 269,604 |
268,214 |
||
| Contributed surplus | 15,706 |
14,786 |
||
| Retained earnings | 62,673 |
58,998 |
||
| Accumulated other comprehensive income | 2,529 |
23 |
||
| Total shareholders' equity | 350,512 |
342,021 |
||
| Total liabilities and shareholders' equity | 653,294 |
652,475 |
||
Jamieson Wellness Inc.
|
||||||||||||
Jamieson Brands |
||||||||||||
| Three months ended March 31 |
||||||||||||
2022 |
2021 |
$ Change | % Change | |||||||||
| Revenue | 83,188 |
|
75,895 |
|
7,293 |
|
9.6 |
% |
||||
| Gross profit | 35,617 |
|
31,057 |
|
4,560 |
|
14.7 |
% |
||||
| Gross profit margin | 42.8 |
% |
40.9 |
% |
- |
|
1.9 |
% |
||||
|
||||||||||||
| Normalized gross profit (1) | 35,617 |
|
31,547 |
|
4,070 |
|
12.9 |
% |
||||
| Normalized gross profit margin | 42.8 |
% |
41.6 |
% |
- |
|
1.2 |
% |
||||
| Selling, general and administrative expenses | 20,051 |
|
19,280 |
|
771 |
|
4.0 |
% |
||||
| Normalized selling, general and administrative expenses | 19,197 |
|
17,682 |
|
1,515 |
|
8.6 |
% |
||||
| Share-based compensation | 1,142 |
|
2,602 |
|
(1,460 |
) |
(56.1 |
%) |
||||
| Earnings from operations | 14,424 |
|
9,175 |
|
5,249 |
|
57.2 |
% |
||||
| Operating margin | 17.3 |
% |
12.1 |
% |
- |
|
5.2 |
% |
||||
| Normalized earnings from operations | 15,278 |
|
11,263 |
|
4,015 |
|
35.6 |
% |
||||
| Normalized operating margin | 18.4 |
% |
14.8 |
% |
- |
|
3.6 |
% |
||||
| Adjusted EBITDA | 19,540 |
|
16,825 |
|
2,715 |
|
16.1 |
% |
||||
| Adjusted EBITDA margin | 23.5 |
% |
22.2 |
% |
- |
|
1.3 |
% |
||||
Strategic Partners |
||||||||||||
| Three months ended March 31 |
||||||||||||
2022 |
2021 |
$ Change | % Change | |||||||||
| Revenue | 20,487 |
|
22,375 |
|
(1,888 |
) |
(8.4 |
%) |
||||
| Gross profit | 2,330 |
|
2,831 |
|
(501 |
) |
(17.7 |
%) |
||||
| Gross profit margin | 11.4 |
% |
12.7 |
% |
- |
|
(1.3 |
%) |
||||
| Selling, general and administrative expenses | 1,569 |
|
1,486 |
|
83 |
|
5.6 |
% |
||||
| Normalized selling, general and administrative expenses | 1,521 |
|
1,603 |
|
(82 |
) |
(5.1 |
%) |
||||
|
|
|
||||||||||
| Earnings from operations | 761 |
|
1,345 |
|
(584 |
) |
(43.4 |
%) |
||||
| Operating margin | 3.7 |
% |
6.0 |
% |
- |
|
(2.3 |
%) |
||||
|
|
|
||||||||||
| Normalized earnings from operations | 809 |
|
1,228 |
|
(419 |
) |
(34.1 |
%) |
||||
| Normalized operating margin | 3.9 |
% |
5.5 |
% |
- |
|
(1.6 |
%) |
||||
| Adjusted EBITDA | 1,405 |
|
1,717 |
|
(312 |
) |
(18.2 |
%) |
||||
| Adjusted EBITDA margin | 6.9 |
% |
7.7 |
% |
- |
|
(0.8 |
%) |
||||
(1) This is a non-IFRS financial measure. See the “Non-IFRS and Other Financial Measures” section of this press release for more information on each non-IFRS financial measure.
Non-IFRS and Other Financial Measures
This press release makes reference to certain financial measures, including non-IFRS financial measures that are historical, non-IFRS measures that are forward-looking, non-GAAP ratios and supplementary financial measures. Management uses these financial measures for purposes of comparison to prior periods and development of future projections and earnings growth prospects. This information is also used by management to measure the profitability of ongoing operations and in analyzing the Company’s business performance and trends. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. The Company uses the following non‑IFRS financial measures: “EBITDA”, “Adjusted EBITDA” and “Adjusted net earnings”, the most directly comparable financial measure for each that is disclosed in its financial statements being net earnings, “normalized gross profit”, “normalized SG&A”, “normalized earnings from operations”, “cash from operating activities before working capital considerations” and “net debt”, the most directly comparable financial measures for each that is disclosed in its financial statements being gross profit, SG&A, earnings from operations, cash flows from operating activities, and long-term debt, respectively, the following non-IFRS ratios: “Adjusted EBITDA margin”, “Adjusted diluted earnings per share”, “normalized gross profit margin”, “normalized operating margin”, and the following supplementary financial measures: “gross profit margin”, “operating margin” and “USD denominated revenue”, to provide supplemental measures of the Company’s operating performance and thus highlight trends in the Company’s core business that may not otherwise be apparent when relying solely on IFRS financial measures. Management also uses non‑IFRS and supplementary financial measures in order to prepare annual operating budgets and to determine components of management compensation. For an explanation of the composition of each such measure and the usefulness and additional uses of each by management, see the “How we Assess the Performance of our Business” section of the MD&A, which is incorporated by reference. See below for a quantitative reconciliation of each non-IFRS financial measure to its most directly comparable financial measure disclosed in the Company’s financial statements to which the measure relates.
The following tables provide a quantitative reconciliation of net earnings to EBITDA, Adjusted EBITDA, and Adjusted net earnings, as well as gross profit to normalized gross profit, SG&A to normalized SG&A, earnings from operations to normalized earnings from operations, each of which are non-IFRS financial measures (see the “Non-IFRS and Other Financial Measures” of this press release for further information on each non-IFRS financial measure) for the three months ended March 31, 2022 and March 31, 2021.
Reconciliation of Non-IFRS Financial Measures
|
||||||
| Three months ended March 31 |
||||||
2022 |
2021 |
|||||
| Net earnings | 9,741 |
|
6,136 |
|
||
| Add: | ||||||
| Provision for income taxes | 3,703 |
|
2,953 |
|
||
| Interest expense and other financing costs | 1,278 |
|
1,415 |
|
||
| Depreciation of property, plant, and equipment | 2,658 |
|
2,396 |
|
||
| Amortization of intangible assets | 1,058 |
|
1,053 |
|
||
| Earnings before interest, taxes, depreciation, and amortization (EBITDA) | 18,438 |
|
13,953 |
|
||
| Add EBITDA adjustments: | ||||||
| Share-based compensation (1) | 1,142 |
|
2,602 |
|
||
| Foreign exchange loss | 463 |
|
16 |
|
||
| IT system implementation (2) | 739 |
|
- |
|
||
| Business integration (3) | - |
|
1,517 |
|
||
| COVID-19 related costs (4) | 163 |
|
698 |
|
||
| Other(5) | - |
|
(244 |
) |
||
| Adjusted EBITDA | 20,945 |
|
18,542 |
|
||
| Provision for income taxes | (3,703 |
) |
(2,953 |
) |
||
| Interest expense and other financing costs | (1,278 |
) |
(1,415 |
) |
||
| Depreciation of property, plant, and equipment | (2,658 |
) |
(2,396 |
) |
||
| Amortization of intangible assets | (1,058 |
) |
(1,053 |
) |
||
| Share-based compensation (6) | (1,142 |
) |
(1,562 |
) |
||
| Tax effect of normalization adjustments | (362 |
) |
(527 |
) |
||
| Adjusted net earnings | 10,744 |
|
8,636 |
|
||
| Three months ended March 31 |
||||||
2022 |
2021 |
|||||
| Gross profit | 37,947 |
|
33,888 |
|
||
| Business integration (3) | - |
|
490 |
|
||
| Normalized gross profit | 37,947 |
|
34,378 |
|
||
| Normalized gross profit margin | 36.6 |
% |
35.0 |
% |
||
| Selling, general and administrative expenses | 21,620 |
|
20,766 |
|
||
| IT system implementation (2) | (739 |
) |
- |
|
||
| Business integration (3) | - |
|
(1,027 |
) |
||
| COVID-19 related costs (4) | (163 |
) |
(698 |
) |
||
| Other (5) | - |
|
244 |
|
||
| Normalized selling, general and administrative expenses | 20,718 |
|
19,285 |
|
||
| Earnings from operations | 15,185 |
|
10,520 |
|
||
| IT system implementation (2) | 739 |
|
- |
|
||
| Business integration (3) | - |
|
1,517 |
|
||
| COVID-19 related costs (4) | 163 |
|
698 |
|
||
| Other (5) | - |
|
(244 |
) |
||
| Normalized earnings from operations | 16,087 |
|
12,491 |
|
||
| Normalized operating margin | 15.5 |
% |
12.7 |
% |
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(1) The Company’s share-based compensation expense pertains to its long-term incentive plan (the “LTIP”), with performance-based share units (“PSUs”), time-based restricted share units (“RSUs”), and deferred share units expenses, along with associated payroll taxes. Expense in the first quarter of 2021 includes a one-time impact of $0.9 million relating to the acceleration of share-based compensation expense from future years in relation to the Company’s previous CEO’s retirement. Please refer to Note 7 in the Company’s unaudited condensed consolidated interim financial statements.
(2) Expenses in the first quarter of 2022 relate to system implementation costs as the Company build out its advanced supply chain planning infrastructure.
(3) Expenses in the first quarter of 2021 pertains to start-up costs of $1.5 million related to the Company’s transition to a third-party logistics model to make room for capacity expansion at the Twin Oaks and Scarborough distribution facilities.
(4) The Company incurred costs related to COVID-19. These costs do not reflect the ongoing costs of operation and they have been adjusted for comparison purposes. In the first quarter of 2022, these costs are primarily associated with safety measures at the Company’s operating facilities, including the use of rapid testing to detect and prevent the risk of COVID-19 spread in its manufacturing facilities and shift premiums to essential Jamieson hourly staff who maintained production during government lockdown. In the first quarter of 2021, expenses include similar shift premiums and the donation of vitamins and supplements to charitable organizations.
(5) First quarter of 2021 consists primarily of a litigation settlement.
(6) Costs pertaining to the Company’s LTIP, excludes PSUs and RSUs granted to certain employees. First quarter of 2021 includes the acceleration of $0.9 million of share-based compensation expense from future years in relation to the Company’s previous CEO’s retirement.
