Numinus Wellness Inc. Reports Q2 2022 Results

• Revenues grew 240% year-over-year to $0.8 million for the quarter
• Achieved 29.1% gross margin during Q2 2022, compared to 6.5% in Q1 2022, due to a larger proportion of higher-margin services being provided across wellness clinics
• Generated gross profit of $228,759 during Q2 2022, a 349% increase from prior quarter
• Recently announced proposed acquisition of Novamind expected to grow annual revenues more than five times from current levels; positions Numinus as a leading, integrated mental healthcare company providing psychedelic-assisted therapies
• Ended quarter with strong cash position of $48.3 million

VANCOUVER, BC, April 14, 2022 – Numinus Wellness Inc. (“Numinus”) (TSX: NUMI) (OTCQX: NUMIF), a mental health care company advancing innovative treatments and safe, evidence-based psychedelic-assisted therapies, today announced its fiscal quarter results for the three and six months ended February 28, 2022 (“Q2 2022”).

“Numinus’ fiscal second quarter demonstrated the strength of our growing service offering and the efficiency of our operating platform, with gross margin improving to 29.1% during Q2 2022 – compared to 6.5% in the previous quarter.  Most of this improvement is due to the successful integration of the Neurology Centre of Toronto – an acquisition we completed during just the quarter before, and the expansion of Ketamine-assisted therapy services across our clinic network,” said Payton Nyquvest, Founder and CEO.  “We’re pleased to see the momentum in our business continue to grow, despite the seasonal slowdown associated with the December holidays during the second quarter.”

Mr. Nyquvest continued: “Looking forward, our recently announced proposed acquisition of Novamind will be transformational for Numinus as we establish a strong U.S. presence with eight revenue producing clinics located in Utah and Arizona.  It also provides two additional clinical research sites and a strong pipeline of clinical research business, which will significantly expand Numinus’ contract research capabilities.  We are very excited about the opportunities ahead as we firmly establish the Numinus brand and our comprehensive combined mental health and wellness offering in the U.S.  Collectively, our combined business will become a leading integrated mental healthcare company providing psychedelic-assisted therapies across North America, generating more revenue than any of our peers.”

Second Quarter Financial Highlights

• Revenues grew 240% year-over-year to $0.8 million in Q2 2022, due primarily to the acquisitions of Mindspace and the Neurology Centre of Toronto. Sequentially, revenues were in line with the prior quarter, representing periods of increased client appointments alongside the seasonally slower period over December holidays.
• Gross margin grew significantly to 29.1% during Q2 2022, compared to 6.5% in Q1 2022 and -25.7% in Q2 2021. The marked improvement in gross margin is due mostly to a greater proportion of higher margin services being booked across Numinus’ wellness clinics. Gross margin improvement was most notable in the two wellness clinic businesses acquired in the last 12 months: Mindspace and the Neurology Centre of Toronto.
• Gross profit of $228,759 in Q2 2022, a 349% increase compared to gross profit compared to Q1 2022, and a significant improvement compared to the gross loss of $59,724 in Q2 2021.
• Loss was $7.8 million for Q2 2022, compared to a loss of $4.2 million in Q2 2021.
• Cash balance of $48.3 million as of February 28, 2022.

First Six Months Financial Highlights

• Revenues during the first half of fiscal 2022 grew 242% year-over-year to $1.6 million due primarily to the acquisitions of Mindspace and the Neurology Centre of Toronto.
• Gross margin during the first half of 2022 was 17.8%, compared to -21.2% in the same period last year.
• Gross profit during the first half of 2022 was $279,724, a significant improvement compared to the gross loss of $97,859 in the first half of 2021.
• Loss was $13.2 million for the first half of 2022, compared to a loss of $6.2 million in the first half of 2021.

Operational Highlights During and Subsequent to Q2 2022:

Numinus Health – Numinus Wellness Clinic Network

• Q2 2022 revenue of $0.7 million, a 5% sequential increase from Q1 2022, and a 378% increase compared to $142,448 during the same period last year.
• During Q2 2022, clients received a total of 5,320 appointments through Numinus clinics (including one-on-one and group therapy sessions, neurology-related appointments and Ketamine-assisted psychotherapy), representing a 14% decline in clinic appointments compared to Q1 2022 due to the anticipated seasonal slowdown during December holidays. On a same-store basis, excluding NCT (the acquisition of which completed partway through Q1 2022), client appointments declined 11% compared to Q1 2022.
• As of April 14, 2022, Numinus has five wellness clinics offering services to clients (one in Vancouver, one in Toronto, and three in Montreal) that have a total of 21 treatment rooms. In addition, the Company has two dedicated research clinics where psychedelic studies are being conducted (one in Vancouver and one in Montreal).
• Numinus is pleased to announce that it will be opening a new flagship wellness clinic location in Vancouver, Canada, during the late summer or early fall of 2022.

Clinical Trials

• On January 19, 2022, Numinus announced that it had received approvals from Health Canada and the Institutional Review Board to proceed with its clinical trial study for MAPS-sponsored MDMA-assisted therapy for PTSD clinical trial study (“MAPPUSX”). Enrollment for the trial is open to eligible participants who were previously enrolled in the placebo arm of the parent study (“MAPP1”) or who were not able to receive treatment due to COVID-19 restrictions.
• On March 30, 2022, the Company announced that it has advanced to the implementation phase of the MAPPUSX trial, by enrolling and dosing the first clinical trial volunteer in Canada.
• Numinus Bioscience has discovered an additional drug product candidate, NBIO-03, that is nearing the final stages of development. The Company now intends to include NBIO-03 in the Phase 1 clinical trial alongside NBIO-01 to establish a maximum tolerated dose. As a result of this new opportunity, Numinus will resubmit its clinical trial application to Health Canada in the next several months to reflect the redefined scope of this study.

Numinus Bioscience – Laboratory Operations

• Q2 2022 revenue of $105,966, a 26% sequential decrease from Q1 2022, but a 19% increase from $89,059 in Q2 2021. During Q2 2022 product shipping challenges impacted the timing of analytical testing services performed for third party clients, which affected the timing of revenue recognition. The Company expects some services intended to be performed during Q2 2022 will now be completed in Q3 2022.
• During Q2 2022, Numinus Bioscience secured several additional strains of psychedelic mushroom species and has already begun genomic analysis of these spore prints for research purposes.
• On February 1, 2022, Numinus announced that it had added three key advisors to its new Bioscience Advisory Board: Graham Pechenik (JD) – Patent Attorney & Founder, Calyx Law, Dr. Paul Spagnuolo (PhD) – Associate Professor, University of Guelph, and Dr. Cory Harris (PhD) – Associate Professor, University of Ottawa.
• On March 9, 2022, the Company announced hat it has received approval from Health Canada to study Ayahuasca and San Pedro.
• On March 14, 2022, Numinus Bioscience announced it was approved for a Containment Level 2 (“CL2”) license by the Public Health Agency of Canada. With the license, Numinus Bioscience will begin:
• The study of pathogens and bacterial, fungal and microbial contaminants to identify baseline markers and optimal growth environments for Psilocybe mushrooms;
• Bioassay studies using mammalian cell lines, to analyze the bioactivity of different whole mushroom formulations that contain both psilocybin and other psychedelic compounds; and
• Pharmacokinetic (PK) and pre-clinical studies using analysis of blood and other bodily fluids, to investigate reactions in the human body to whole mushrooms and other natural formulations.
• As a result of the pending proposed acquisition of Novamind and the two additional clinic research facilities the Company will gain as a result of this expansion, Numinus Bioscience has decided to halt its planned research facility expansion in Nanaimo, B.C. The Company believes diversifying its research capabilities across both Canada and the U.S. will better serve Numinus’ contract research clients and long-term strategy.

Corporate Updates

• On December 16, 2021, Numinus graduated to the TSX (from the TSX-Venture), trading under the symbol “NUMI”.
• On January 27, 2022, the Company graduated to the OTCQX® Best Market in the United States, as a first step towards establishing a greater profile with the U.S. investment community.
• On February 28, 2022, Numinus held its Annual General and Special Meeting of Shareholders, where all proposed Directors were elected to its Board, and all other resolutions were approved by shareholders.
• On April 12, 2022, Numinus announced the proposed acquisition of Novamind – which will position Numinus as a leading, integrated mental healthcare company providing psychedelic-assisted therapies – with 13 wellness clinics and approximately $10 million of combined proforma annual revenue.
• The companies have entered into an arrangement agreement (the “Arrangement Agreement”) dated April 12, 2022, pursuant to which Numinus will acquire all of the issued and outstanding common shares of Novamind by way of a court-approved plan of arrangement under the Canada Business Corporations Act, for total valuation of approximately $26.2 million on a fully diluted in-the-money basis.
• Under the terms of the Arrangement Agreement, shareholders of Novamind will receive 0.84 of a common share of Numinus for each Novamind share held, implying an offer price of $0.44 per Novamind share.
• Transaction is expected to close in June 2022 and is subject to customary closing conditions, including approvals of the shareholders of Numinus and Novamind and approval of the TSX.
• Numinus is beginning the process to apply to the SEC for a listing on a major US stock exchange and it is targeting to have the listing completed by the Fall of 2022. While the Company is well capitalized, it would only contemplate additional financing opportunities if it makes strategic sense.

Q2 2022 Key Performance Metrics:

Numinus’ condensed consolidated financial statements for the three and six months ended February 28, 2022 and related management’s discussion and analysis are available on Numinus’ Investor Relations website at www.investors.numinus.com and under the Company’s profile on SEDAR at www.sedar.com.  These documents were prepared in accordance with IFRS.

Conference Call and Webcast Details
Interested parties are invited to participate in the Company’s Q2 2022 results conference call and webcast. On the call Numinus executives will review the Company’s performance and recent initiatives, and answer questions from analysts.

The webcast will also be archived on the Events and Presentations page of Numinus’ Investor Relations website: https://www.investors.numinus.com/events-and-presentations

About Numinus
Numinus Wellness (TSX: NUMI) helps people to heal and be well through the development and delivery of innovative mental health care and access to safe, evidence-based psychedelic-assisted therapies. The Numinus model – including psychedelic production, research and clinic care – is at the forefront of a transformation aimed at healing rather than managing symptoms for depression, anxiety, trauma, pain and substance use. At Numinus, we are leading the integration of psychedelic-assisted therapies into mainstream clinical practice and building the foundation for a healthier society.

Learn more at www.numinus.com and follow us on LinkedIn, Facebook, Twitter, and Instagram.

Forward-looking statements
This press release contains forward-looking statements within the meaning of applicable securities laws. All statements that are not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs regarding future performance are “forward-looking statements”. Forward-looking statements can be identified by the use of words such as “expects”, “does not expect”, “is expected”, “believes”, “intends”, “anticipates”, “does not anticipate”, “believes” or variations of these words, expressions or statements, that certain actions, events or results “may”, “could”, “would”, “might” or “will be” taken, will occur or will be realized. Such forward-looking statements involve risks, uncertainties and other known and unknown factors that could cause actual results, events or developments to differ materially from the results, events or developments expected and expressed or implied in such forward-looking statements. These risks and uncertainties include, but are not limited to, dependence on obtaining and maintaining regulatory approvals, including the acquisition and renewal of federal, provincial, municipal, local or other licenses, and any inability to obtain all necessary government authorizations, licenses and permits to operate and expand the Company’s facilities; regulatory or policy changes such as changes in applicable laws and regulations, including federal and provincial legalization, due to fluctuations in public opinion, industry perception of integrative mental health, including the use of psychedelic-assisted therapy, delays or inefficiencies or any other reason; any other factor or development likely to hamper the growth of the market; the Company’s limited operating and profitability track record; dependence on management; the Company’s need for additional financing and the effects of financial market conditions and other factors on the availability of capital; competition, including that of more established and better funded competitors; the impact of the Russia–Ukraine conflict on the global economy; the continued impact of the COVID-19 pandemic; and the need to build and maintain alliances and partnerships, including with research and development companies, customers and suppliers. These factors should be carefully considered, and readers are cautioned not to place undue reliance on forward-looking statements. Despite the Company’s efforts to identify the main risk factors that could cause actual measures, events or results to differ materially from those described in forward-looking statements, other risk factors may cause measures, events or developments to materially differ from those anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. The Company does not undertake to revise forward-looking statements, even if new information becomes available as a result of future events, new facts or any other reason, except as required by applicable laws.

SOURCE Numinus Wellness Inc.