CALGARY, AB, April 29, 2024 /CNW/ - Decibel Cannabis Company Inc. (the "Company" or "Decibel") (TSXV:DB) (OTCQB:DBCCF), a market leader in premium cannabis and extract manufactured products, is pleased to announce its audited financial results for the three and twelve month periods ending December 31, 2023. "The Company's fourth quarter financial results delivered another year of growth across all metrics and I look forward to working with the team to continue to build on this success" said Benjamin Sze, Decibel's new Chief Executive Officer. Fiscal Year 2023 Financial Highlights Record Net Revenue of $116 million in 2023, an increase of 46% over 2022. Record Adjusted EBITDA(1) of $25.9 million in 2022, an increase of 52% over 2022. Record Adjusted Net Income(1) of $8.0 million in 2022, an increase of $4.9 million over 2022. Notes:  1 Non-GAAP financial measure. Refer to "Cautionary Statement Regarding Certain Non-GAAP Measures" for further details. 2 Non-GAAP ratio. Refer to "Cautionary Statement Regarding Certain Non-GAAP Measures" for further details. Fourth Quarter Highlights Record Net Revenue was $27.7 million in the fourth quarter of 2023, with year over year growth of 8%. The net revenue growth was driven by increased demand for the Company's derivative products. Gross Margin Before Fair Value Adjustments was 45% in the fourth quarter of 2023, compared to 43% in the fourth quarter of 2022. The increase partially reflects operational investments that partially impacted the quarter, including expansion of the Company's manufacturing capacity. Adjusted EBITDA(1) of $5.1 million in the fourth quarter of 2023, with a year over year decline of 27% over the fourth quarter of 2022. The decrease in Adjusted EBITDA was primarily driven by an increase in SG&A relating to increased sales and marketing spend and the launch of the Blinker proprietary vape system of $638 thousand.  Adjusted Net Income(1) of negative $132 thousand in the fourth quarter of 2023, with a decline of $1.9 million over the fourth quarter of 2022. Adjusted Net Income was negatively impacted by $1.8 million of bad debt expense and $638 thousand for launch costs of Blinker, the Company's proprietary new closed loop vape system. Leverage: At the end of the fourth quarter of 2023, Decibel had a funded debt to trailing twelve month EBITDA(2) of 1.58x. Notes:  1 Non-GAAP financial measure. Refer to "Cautionary Statement Regarding Certain Non-GAAP Measures" for further details. 2 Non-GAAP ratio. Refer to "Cautionary Statement Regarding Certain Non-GAAP Measures" for further details. Operating Highlights International Developments Subsequent to year end, the Company achieved the following developments internationally: completed its craft cannabis first export to Australia in March 2024; received its first purchase order for vapes to export to Australia; signed a supply agreement with a new Israel counterparty contemplating an annual commitment of 1,000 kilograms of craft cannabis; and an Israeli customer defaulted on its payments required under the cannabis supply agreement with the Company, leading the Company to provision $1.6 million of such receivable. The Company took formal legal action to collect the receivable, and the Israeli company subsequently filed an insolvency motion. Decibel joined these proceedings and formally filed its claim with the trustee. The Company believes there is 300kg of inventory related to this provisioned receivable that is currently accessible, and that a portion of the receivable may be recoverable through a resale agreement of this inventory with the trustee and another Israeli company. Summary Highlights Three months endedDecember 31 Year endedDecember 31 2023 2022 2023 2022 (thousands of Canadian dollars, except where noted) Gross Canadian recreational sales 1,2 $43,202 $36,140 $177,231 $108,187 Net Canadian recreational sales 1,2 $24,808 $21,586 $105,773 $68,559 International sales 2 $1,427 $1,893 $3,692 $1,893 Retail sales 1,2 $1,498 $2,318 $6,493 $8,874 Number of retail stores 6 6 6 6 Total Gross revenue $46,127 $40,351 $187,416 $118,954 Net revenue $27,733 $25,797 $115,958 $79,326 Gross profit before fair value adjustments $12,365 $11,082 $51,631 $34,026 Gross margin before fair value adjustments 45 % 43 % 45 % 43 % Adjusted EBITDA 3 $5,136 $7,061 $25,904 $17,010 Loss and comprehensive loss ($1,191) ($3,147) ($1,770) ($4,462) Adjusted net income 3 ($132) $1,788 $8,002 $3,134 Cash flow from operations $1,903 ($114) $7,077 $8,258 Free cash flow 3 $1,498 ($499)