PENTICTON, BC / ACCESSWIRE / April 6, 2022 / EastWest Bioscience Inc. (“EastWest” or “Company”) (TSXV:EAST), announced that it has filed its Quarterly Financials and MD&A under its profile on SEDAR with a material change in its profit numbers.
During the year ended July 31, 2021, the Company added self-storage to its already diverse revenue streams through a new subsidiary, 1290185BC dba Spare Room Co (“Spare Room”) is an early-stage company intending to build high-quality self-storage facilities across western Canada. The inception of this subsidiary was initiated by the Company’s need to leverage its Penticton facility, which has been underutilized.
November 4, 2021, the Company closed a non-brokered financing round through Spare Room. Spare Room received aggregate proceeds of $4,915,300 from the issuance of 9,830,600 common shares of Spare Room at C$0.50 per share. Spare Room is using the net proceeds from the Offering for the acquisition and construction of new self storage facilities, and general corporate purposes.
As a result of the non-brokered financing, the Company lost majority control of Spare Room and the Company had to derecognized the assets and liabilities of Spare Room from its consolidated statement of financial position, recorded its interest retained in Spare Room at fair value as an investment in associate at $5,824,999, and recognized a gain from deconsolidation of $2,874,625 associated with the loss of control. The Company consolidated Spare Room’s profit or loss up to November 4, 2021.
Update on Operations of Spare Room
Since its inception in the spring of 2021, Spare Room has had two locations under construction: Penticton, British Columbia, and Oliver, British Columbia.
The Oliver location, which is an outdoor site, has had all the necessary site infrastructure improvements completed and is awaiting the connection of electrical to its site. The initial order of containers has arrived on site and has been installed. The site is on track to open early April and is anticipating customer purchase to begin immediately.
The Penticton location, which is also located in the 2nd floor of the Company’s Head Office, will house an indoor storage site. Spare Room has received locker systems for the site and is currently awaiting the necessary permits from the City of Penticton.
Additionally, Spare Room has signed three Letters of Intent (LOI) for additional sites which are in the final stage of negotiations. It is anticipated that these negotiations will close over the next quarter.
The Canadian market for storage is expected to be robust as the market for self-storage is vastly underserved compared to the US market. As part of its growth strategy, Spare Room continues to focus its efforts on smaller markets where the demand for storage is underserved.
About the EastWest Bioscience Group of companies
EastWest Bioscience is a vertically integrated wellness company with a multitude of business units and assets that allow for seed-to-sale supply chain management. We source our raw material, process, manufacture, test, brand, market, and distribute our products to our customers in Canada, the United States, and beyond. The Company owns and operates retail and manufacturing subsidiaries.
The Company’s retail subsidiary is the award winning, Canadian natural health retail franchise – Sangster’s Health Centres – with over 40 years of legacy in the health and wellness industry. Sangster’s goal is to provide natural choices through quality products and educated advice for a healthy lifestyle. Sangster’s Health Centres occupies a unique position in the industry, the stores provide vast knowledge and safe natural remedies for the prevention and treatment of disease and ailments. Sangster’s introduction and development of over 202 exclusively labeled products (vitamins, mineral, herbs, proteins, natural body care and organic foods) catapulted Sangster’s name and product into a large number of Canadian households. From a solid base in Saskatchewan, Sangster’s has become a national brand name with franchise stores located across Canada.
Orchard Vale Naturals is the Company’s manufacturing arm that is certified with a Health Canada Site License and has GMP Certified NHP Manufacturing capabilities. Orchard Vale Naturals specializes in custom blends and production runs of all sizes, small to large, for top-quality products with quick turnaround times. Orchard Vale Naturals operates out of a 34,000 sq. ft. Health Canada licensed facility in Penticton, British Columbia owned by EastWest Bioscience, which acts as the Head Office for all of EastWest’s Canadian operations.
The Company’s subsidiary 1290185 B.C. LTD dba Spare Room Co Self Storage (“Spare Room”) is building a network of automated self-storage sites in British Columbia. The subsidiary’s business model is designed to be low capex with highly scalable logistics. It is focused on secondary markets, consumer automation and innovative land partnerships, allowing it to move into new regions quickly, at scale and with minimal risk. EastWest hopes to build Spare Room into a household name across Canada.
ON BEHALF OF THE BOARD OF DIRECTORS OF
EASTWEST BIOSCIENCE INC.
Co-Founder, Chief Executive Officer and Director
For Further Information:
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain “forward-looking statements” under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the matters disclosed herein. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; and delay or failure to receive board, shareholder or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.