Business
RUM Reports Financial Results for Year Ended 2022 and Positive Retained Earnings
EDMONTON, AB / ACCESSWIRE / April 25, 2023 / Rocky Mountain Liquor Inc. (TSXV: RUM ) (the "Comp...
About this update from Rocky Mountain Liquor Inc.
[{"type":"text","content":"RUM Reports Financial Results for Year Ended 2022 and Positive Retained EarningsEDMONTON, AB / ACCESSWIRE / April 25, 2023 / Rocky Mountain Liquor Inc. (TSXV:RUM ) (the \"Company\" or \"Rocky Mountain\"), listed on the TSX Venture Exchange (the \"Exchange\"), today reported its financial results for the year ended December 31, 2022.KEY OPERATING AND FINANCIAL METRICS 3 months ended 12 months ended Dec 2022 Dec 2021 Dec 2022 Dec 2021 Sales $10,416,242 $11,037,322 $41,981,133 $44,789,043 Gross Margin 22.7% 21.6% 22.6% 22.4%EBITDAR $758,259 $616,426 $2,681,137 $3,271,553 Net Income $131,673 $214,221 $277,529 $1,142,665 Bank Debt $3,093,814 $4,064,810 $3,093,814 $4,064,810 Net income for the 12-month period ending December 31, 2022, of $277,529 results in the Company ending in a position of positive retained earnings on its statement of financial position from its prior year's accumulated deficit position. This is the first yearend since December 31, 2016, that the Company has reported positive retained earnings.Reducing bank debt was crucial in managing finance costs in a period when the prime rate increased from 2.45% to 6.45%. Bank debt was reduced by $970,996 in the 12-month period ended December 31, 2022, as a result of the Company's focused deleveraging strategy.In 2021, restrictions were in place for on-site liquor consumption establishments resulting in a positive effect on retail liquor sales in 2021. As restrictions were removed in February 2022, there was a subsequent decrease to retail liquor sales in 2022. Consumer spending on retail liquor was impacted due to a rapid increase in interest rates beginning June 2022. This increase to interest rates reduced disposable income and limited growth in consumer spending. As a result of these factors, sales for the three months ended December 31, 2022, were 5.6% lower than sales during the same period in 2021 and 6.2% lower on a year-over-year basis during the 12-month period ended December 31, 2022. The Company increased its operating margin by 17.9% in Q4 2022 over the same quarter in 2021 by focusing on cost efficiencies and selling an under-performing store.In Q4 2022, the Company increased its gross margin by 5.6%, with margins increasing to 22.7% for the three months ended December 31, 2022, compared to 21.6% for three months ended December 31, 2021. For the 12-month period...