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July 28, 2022

Full recap of the Federal Reserve’s rate hike and Powell’s market-boosting comments

Stocks close higher on Wednesday as Powell hints Fed could slow pace of rate hikes

The major averages surged as Federal Reserve Chair Jerome Powell spoke at his press conference on Wednesday and suggested the central bank could slow the pace of its hikes.

The S&P 500 added 2.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to close at 4,023.61. The tech-heavy Nasdaq Composite gained nearly 4.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to end at 12,032.42. The Dow Jones Industrial Average leapt 436.05 points, or 1.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, to end at 32,197.59.

The 10-year Treasury yield ended the day little changed.

-Darla Mercado

Fed’s awareness of economic impact of hikes is helping stocks, says BlackRock’s Chaudhuri

Jerome Powell has signaled that the Fed is aware of the negative impact of its rate hikes on the economy, which is boosting stocks on Wednesday afternoon, according to a strategist at BlackRock.

“I think the reason this is providing some relief to the equity market is the Fed is acknowledging that there can be an impact on growth, to the economy, based on their policy,” said Gargi Chaudhuri, head of BlackRock’s iShares investment strategy, Americas. “They’re recognizing there are two sides of this – there’s a growth tradeoff to fight inflation. The recognition is something we heard today that we didn’t hear before.”

Powell said that the Fed could slow rate hikes in the months ahead and said that there could be some more financial tightening “in the pipeline” from the hikes that have already been made but maybe haven’t taken full effect yet throughout the economy.

Chaudhuri said the market was reacting to several things, including the fact the Fed stuck to a 75 basis point hike and did not go more aggressively. She said it was a positive the statement reflected that the economy was slowing, and the fact that it will be data dependent going forward.

“They knew this was something the market would pay attention to, and they want to take sure we notice they acknowledge the slowing down of the economy” as a result of their policy, she said.

— Patti Domm, Jesse Pound

Fed Chair Jerome Powell says he doesn’t think the U.S. is in a recession

Federal Reserve Chairman Jerome Powell said in his press conference today that “it doesn’t make sense that the economy would be in recession,” given monthly payroll growth has recently been averaging 450,000 jobs, and that employers added 2.7 million jobs in the first half.

“I do not think that the U.S. is currently in a recession,” he said, “and the reason is there are just too many areas of the economy that are performing too well.”

To be sure, “growth is slowing for reasons that we understand. Growth was exceptionally high last year, 5.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. We would have expected growth to slow. There’s also more slowing going on now,” Powell added.

This is not yet a buying opportunity for investors, says analyst

For investors chomping at the bit and ready to buy risky assets, Oanda’s senior market analyst Ed Moya said the time might not be right just yet.

“A clear greenlight to buy up risky assets won’t happen until we see evidence inflation is coming down,” he said.

“Inflation risks will remain elevated as energy shortages are likely, supply chain issues won’t ease given a weakening global outlook, and as pandemic-related issues remain troubling,” Moya added.

— Pippa Stevens

Preliminary GDP numbers should be taken with a ‘grain of salt,’ Powell says

Preliminary gross domestic product numbers should generally be taken with a “grain of salt,” Fed Chair Jerome Powell said.

“It’s very hard to cumulate U.S. GDP, it’s a large economy and a lot of work and judgment goes into that,” Powell said. “You tend to take first GDP reports I think with a grain of salt, but of course it’s something we’ll be looking at.”

He noted that GDP numbers are often “revised pretty significantly.”

Preliminary numbers for second-quarter U.S. economic growth are slated for release Thursday morning.

— Samantha Subin

Fed statement seems to be the first since January 2020 to not mention coronavirus

Big Tech stocks jump as market extends gains

Stocks have extended their gains since the start of Federal Reserve Chair Jerome Powell’s press conference, including some big moves by blue-chip stocks.

In the tech sector, Microsoft has jumped 6.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, while shares of Google-parent Alphabet are up nearly 8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. Amazon surged more than 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, while Apple has added 2.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

Bank stocks are also performing well. Shares of JPMorgan, Goldman Sachs and Citigroup are all up more than 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

— Jesse Pound

Rate increases are accomplishing their goal, Harris’ Cox says

The rate hikes from the Federal Reserve are accomplishing their goal, said Jamie Cox, a managing partner at Harris Financial Group.

“The rate increases are having their intended effect,” he said. “We are just not sure what the price is going to be. The main effect is that markets are confident that the Fed won’t allow inflation to become anchored among consumers and businesses, and that’s maybe the first time this year that this has happened.”

— Samantha Subin

Powell says another ‘unusually large’ increase could be appropriate, will depend on data

Wednesday’s rate hike is the second consecutive 0.75 percentage point jump from the Fed, and more large moves could be on the horizon.

“While another unusually large increase could be appropriate at our next meeting that is a decision that will depend on the data we get between now and then,” Fed Chair Jerome Powell said.

The central bank will continue to make decisions meeting by meeting and do its best to communicate the thinking behind further moves, Powell said.

Powell also acknowledged that the pace of rate hikes could slow at some point, depending on the data the Fed watches.

“As the stance of monetary policy tightens further, it likely will become appropriate to slow the pace of increases while we assess how our cumulative policy adjustments are affecting the economy and inflation,” he said.

Fed is looking for ‘compelling evidence’ that inflation has subsided, Powell says

The Federal Reserve is on the hunt for signs that inflation is easing, according to Fed Reserve Chair Jerome Powell.

“Over coming months we will be looking for compelling evidence that inflation is moving down, consistent with inflation returning to 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},” Powell said.

He added that the Fed expects likely increases to the target range for the fed funds rate going forward, however, that pace is dependent on future data and the economy.

— Samantha Subin

Powell says inflation is ‘much too high’

Federal Reserve Chair Jerome Powell said in his opening remarks that the state of the economy has not changed too much over the past month.

“From the standpoint of our Congressional mandate to support maximum employment and price stability, the current picture is plain to see: The labor market is extremely tight, and inflation is much too high,” Powell said.

—Jesse Pound

Rate hikes will need to continue to combat inflation, Shah says

The current interest rate hiking cycle is swiftly proving to be one of the Fed’s most aggressive in recent decades, Seema Shah, chief global strategist at Principal Global Investors said. They’ll need to continue to tamp down inflation, she said.

“Combatting four-decade high inflation will take a sustained show of strength from the Fed, rendering a soft landing an almost impossible pipe dream,” said Shah.

Still, the central bank’s next move may not be as large as the hike Wednesday.

“From here, it is possible that the Fed slows its tightening pace, reassured by the likely peaking of inflation and pullback in inflation expectations as oil prices have fallen,” Shah said. “However, with the labor market still a picture of strength, wage growth still uncomfortably high and core inflation set to decline at a glacially slow pace, the Fed certainly cannot stop tightening, nor can it downshift gears too much.”

She expects that rates will rise above 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} next year before a recession hits, potentially opening the door for rate cuts in late 2023.

— Carmen Reinicke

Bleakley’s Peter Boockvar calls Fed statement a ‘big yawner’

Bleakley Advisory Group’s Peter Boockvar called the latest statement from the Federal Open Market Committee a “big yawner” given the minimal changes from the June meeting.

“The FOMC statement was a big yawner with only modest changes to it relative to the June meeting,” he wrote. “After saying in June that “overall economic activity appears to have picked up after edging down in the first quarter,” they certainly backtracked on that as they should have.”

According to Boockvar, that puts added pressure on Fed Chair Jerome Powell’s press conference later this afternoon, which should steer expectations going forward.

“While he has no reason yet to commit to anything, I’m sure that Powell will let us know that he remains vigilant in his battle with inflation at the same time ‘hoping’ that it won’t involve a recession, even though it’s basically too late for that,” he said.

— Samantha Subin

Fed’s statement says parts of the economy have softened

The most notable change in this meeting’s Fed policy statement came right at the top.

“Recent indicators of spending and production have softened,” the statement began. “Nonetheless, job gains have been robust in recent months, and the unemployment rate has remained low.”

After the June meeting, the Fed had said economic activity “appears to have picked up after edging down in the first quarter.”

Check out the full statement and its changes here.

— Jesse Pound

Stocks maintain gains after Fed rate hike

The three major averages held onto their gains after the Federal Reserve said it would raise interest rates by 0.75 percentage point.

The S&P 500 was up about 1.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} shortly after the central bank announced its move. The Nasdaq Composite gained roughly 2.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and the Dow Jones Industrial Average added about 70 points.

Indeed, this year thus far stocks have ended the day higher after the Fed raises interest rates.

The 10-year Treasury yield remained lower even after the rate hike.

–Darla Mercado

Federal Reserve hikes interest rates by 0.75 percentage point

The Federal Reserve raised interest rates by 0.75 percentage point on Wednesday. It’s the second consecutive rate hike of that magnitude.

The central bank’s move raises the benchmark overnight borrowing rate up to a range of 2.25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

The rate hike comes as the Fed attempts to cool down inflation while avoiding a recession.

Bill Ackman asks where Powell’s mojo has gone in his fight against inflation

Hedge fund manager Bill Ackman took to Twitter again Wednesday before the Federal Reserve’s policy decision, indicating that Chair Jerome Powell has lost his mojo in fighting soaring inflation compared to his role in rescuing the economy from the Covid crisis.

The Pershing Square CEO said he doesn’t understand why Powell is reluctant to say that the Fed will stop inflation by hiking rates and keeping them higher for longer until ample evidence of easing price pressures.

— Yun Li

Why a hawkish Fed could spook the market

Stocks and bond prices have rallied in the weeks leading up to Wednesday’s expected rate hike, which could put markets at risk for a backslide if the Federal Reserve holds course.

Signs of an economic slowdown have led to speculation on Wall Street that the central bank may soon take its foot off the gas of its rate hikes in an attempt to avoid a recession. However, Fed Chair Jerome Powell took an aggressive stance against inflation at the last meeting, and he could do so again on Wednesday.

“I think the Fed will be more hawkish than dovish. I think that people in the market are looking for them to pull back and slow down the hawkish nature of their general commentary, and I think this meeting they’re going to be disappointed,” said Eric Merlis, managing director, global markets at Citizens Financial.

In fact, some traders have started to price in rate cuts next year, anticipating a pivot from the Fed. The CME’s FedWatch tool shows a 100{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} chance of the Fed funds rate being at 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} or higher by December, before declining to roughly a 75{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} chance of that in July 2023.

“I understand why it’s being priced in but, from a pure trading standpoint, you could see a big piece of that reverse today after the press conference,” Merlis said.

— Jesse Pound

BlackRock’s Rick Rieder expects the Fed to raise rates three more times

BlackRock’s Rick Rieder said he anticipates the Federal Reserve will raise rates by 0.75 percentage point Wednesday and two more rate hikes may be in the cards before the central bank stops.

The central bank is widely expected to announce a 75 basis point rate hike on Wednesday afternoon. (1 basis point equals 0.01{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996})

“I think the implications will be that you go to 50 in September, and then I quite frankly think markets have gotten to a place, which I think is right, that they’re going to maybe do another 25 and I think that’s it,” said Rieder, chief investment officer of global fixed income at BlackRock

He added that what Fed Chair Jerome Powell says at his press briefing on Wednesday afternoon will be key.

“The thing is watch what they do, not what they say,” Rieder said. “I’ve got to watch more what they say than what they do. Meaning, I don’t think the 75 or the statement are going to be that interesting. And I think they have to tone down the economic section of the statement. But I think what he says will be more important than the 75 in that the data is not ambiguous to the slowdown.”

Atlanta Fed’s GDPNow forecasts second-quarter GDP will fall by 1.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

The Atlanta Federal Reserve updated its real-time reading of economic growth on Wednesday, calling for a decline of 1.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for the second quarter.

Previously, the Atlanta Fed’s GDPNow tool forecasted that gross domestic product would decline by 1.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

The Atlanta Fed cited recent data releases from the Census Bureau and the National Association of Realtors as factors behind its decision. Indeed, pending home sales slid 20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in June on a year-over-year basis, according to the latest data from the National Association of Realtors. Meanwhile, new orders for manufactured durable goods in June rose by 1.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to $272.6 billion, the Census Bureau found.

Second-quarter GDP data is due on Thursday. Since the first quarter saw GDP decline by 1.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, economists and investors are wondering whether this next release will reflect two consecutive quarters of negative GDP readings.

Two back-to-back negative GDP quarters don’t constitute a recession, however. The National Bureau of Economic Research makes that determination and uses multiple factors to do so.

-Darla Mercado

The Federal Reserve is anticipated to announce an interest rate hike of 0.75 percentage point

The Federal Reserve is expected to raise interest rates by 0.75 percentage point – its second hike of that magnitude since June and a first in the “modern era” of Fed policy.

The anticipated rate hike comes at a pivotal time as policymakers attempt to slow inflation and provide the economy with a soft landing. The consumer price index for June leapt 9.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from a year ago, and consumer spending on a dollar level has been solid. Meanwhile, jobless claims have ticked higher, which suggests the labor market is starting to cool.

Investors are paying especially close attention to the Fed’s decision Wednesday because second-quarter gross domestic product numbers are out on Thursday. GDP declined by 1.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} during the first quarter. Two consecutive quarters of negative economic growth could make the Fed’s path on rate hikes even more precarious.

–Darla Mercado, Jeff Cox

July 20, 2022

Why the stock market still hasn’t priced in a full recession

Recession calls are expanding by the day, but the inventory sector stays wary of totally pricing in this circumstance for the economy.

Even with enduring the worst commence to a yr given that 1970, the benchmark S&P 500 (^GSPC) is even now buying and selling 13{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} higher than a commonly-cited recessionary target of 3,400, which would mark a ~29{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} drop from the record large arrived at on January 3, 2022.

In the regular economic downturn given that Earth War II, the S&P 500 has dropped 31{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

“Investors and enterprise administrators alike tend to participate in the hand they are dealt, even if marketplaces price economical belongings based mostly on anticipations of the upcoming 3-6 attracts from the deck,” Nicholas Colas, co-founder of DataTrek Research, mentioned in a observe printed Tuesday. “We could not have the strongest hand just now, but it is not undesirable plenty of to drive lots of investors or businesspeople to fold.”

In Colas’ check out, the math on 3,400 functions out to assuming the regular 25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} fall in earnings and placing an earnings a number of of 20x on the S&P 500, which is the place the index is around valued today.

Strategists at Financial institution of The united states International Exploration last 7 days minimize their 12 months-stop price tag target on the benchmark to 3,600 from 4,500 and identified as for a “mild recession” this yr.

The bank’s July fund manager study also shows a “dire stage of trader pessimism,” with its BofA Bull & Bear Indicator holding at “max bearish” as buyers fret over advancement and revenue slowdowns.

Sentiment is so poor that fairness allocations are the least expensive considering the fact that the 2008 economic crisis and income degrees are at the highest considering the fact that 9/11.

Also curbing expectations last 7 days was Credit history Suisse main U.S. equity strategist Jonathan Golub, who slash his estimate for the S&P 500 by 600 points to 4,300 in an about facial area from a phone by the expenditure lender in December 2021 that the index would complete this calendar year at 5,200.

Even Oppenheimer Asset Administration main financial investment strategist John Stoltzfus — the Wall Street analyst with the optimum yr-close value target tracked by Yahoo Finance — just lately slash his focus on on the S&P 500 to 4,800 from 5,330.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., July 11, 2022. REUTERS/Brendan McDermid — Traders do the job on the flooring of the New York Inventory Trade (NYSE) in New York City, U.S., July 11, 2022. REUTERS/Brendan McDermid

In a equivalent transfer, strategists at BlackRock downgraded their outlook and diminished the firm’s suggested exposure to stocks, citing raising financial uncertainty and persistent inflation.

In spite of the doom and gloom, matters are not as poor as they glance, in Colas’ view.

For instance, even though buyers are bracing for a milder-than-regular earnings season and downwardly revising EPS predictions, the S&P 500 is however predicted to log aggregate earnings for every share of $56, for each DataTrek. The standard recession, as mentioned earlier mentioned, sees earnings for each share slide by 25 per cent, a decrease that would place that determine at $42 for every share for each quarter.

Industry experts have also pointed to continued consumer resilience in spite of inflation, as nicely as a occupation current market that remains in fantastic condition even as the Federal Reserve tightens money circumstances.

In June, the newest inflation report confirmed purchaser selling prices rose at an yearly speed of 9.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in June – the optimum considering that 1981, though retail sales rose 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} that some thirty day period, a lot more than predicted by Wall Road economists.

And even though the labor industry is incorporating employment at a marginally slower pace from the submit-pandemic ordinary of 400,000 for every month, occupation gains in June continue to totaled 372,000.

“The mixture of these two variables can preserve demand continuous for longer than is typical at the stop of an financial expansion,” Colas reported, “even if the Fed is elevating interest premiums to sluggish the American economy and lessen inflation.”

—

Alexandra Semenova is a reporter for Yahoo Finance. Stick to her on Twitter @alexandraandnyc

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June 12, 2022

Logan Ridge Finance Corporation Announces Full Repayment of

NEW YORK, June 07, 2022 (Globe NEWSWIRE) — Logan Ridge Finance Company (“LRFC” or the “Company”) (Nasdaq: LRFC) currently introduced the repayment in full of its 5.75{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} set-amount Convertible Notes (the “2022 Convertible Notes” – Nasdaq: CPTAG) and 6.00{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} fastened-amount Notes (the “2022 Notes” – Nasdaq: CPTAL), each owing May possibly 31, 2022.

As of March 31, 2022, complete total fantastic of the 2022 Convertible Notes and 2022 Notes ended up $52.1 million and $22.8 million, respectively.

The repayment to the Trustee was completed on Might 11, 2021 making use of money on hand and as effectively as proceeds from refinancing the Company’s overall legacy funds framework. This was an critical milestone and critical strategic initiative for the Enterprise. Specifically, since Mount Logan Management, LLC (“Mount Logan”) began handling the Corporation on July 1, 2021, the Organization has done the subsequent transactions:

KeyBank Credit rating Facility: On May possibly 10, 2022, the Firm amended its present senior secured revolving credit score facility with KeyBank (“KeyBank Credit history Facility”), by growing the initial determination from $25. million to $75. million, with an uncommitted accordion function that allows the Business to borrow up to an additional $125. million. The amended KeyBank Credit history Facility has a May 10, 2027 maturity day. Borrowings beneath the amended KeyBank Credit rating Facility bear fascination at 1M Expression SOFR plus 2.90{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for the duration of the 3-calendar year revolving time period and 3.25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} thereafter, with .40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} 1M Term SOFR ground.
2032 Convertible Notes: On April 1, 2022, the Enterprise entered into a take note invest in arrangement for the issuance of $15. million convertible notes because of in April 2032. The 2032 Convertible Notes bear desire at 5.25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.
2026 Notes: On October 29, 2021, the Corporation entered into a take note acquire arrangement for the issuance of $50. million notes due in October 2026. The 2026 Notes bear curiosity at 5.25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

About Logan Ridge Finance Corporation
Logan Ridge Finance Company (Nasdaq: LRFC) is a company advancement company that invests largely in first lien loans, and, to a lesser extent, 2nd lien financial loans and fairness securities issued by lessen middle current market companies. The Enterprise invests in executing, perfectly-recognized center marketplace enterprises that work throughout a wide variety of industries. It employs fundamental credit rating analysis, focusing on investments in businesses with fairly lower stages of cyclicality and operating risk. For additional data, check out loganridgefinance.com.

About Mount Logan Funds Inc.
Mount Logan Capital Inc. (“MLC”) is an different asset administration enterprise that is concentrated on public and non-public personal debt securities in the North American current market. MLC is the supreme command person of Mount Logan Administration, LLC, which serves as the Company’s financial investment adviser. MLC seeks to resource and actively manage financial loans and other personal debt-like securities with credit history-oriented qualities. MLC actively sources, evaluates, underwrites, manages, screens and generally invests in financial loans, personal debt securities, and other credit-oriented instruments that existing eye-catching chance-modified returns and existing low hazard of principal impairment as a result of the credit history cycle. MLC is an affiliate of BC Associates Advisors L.P. for U.S. regulatory applications.

About BC Partners Advisors L.P. and BC Partners Credit score
BC Associates is a main global financial commitment organization with in excess of $40 billion of property below management in private equity, private credit history and genuine estate approaches. Recognized in 1986, BC Companions has played an lively position in developing the European buyout market for a few many years. Currently, BC Companions executives work across markets as an built-in group by means of the firm’s places of work in North America and Europe. Considering that inception, BC Partners has accomplished 117 personal equity investments in businesses with a total business value of €149 billion and is at this time investing its eleventh private equity fund.

BC Companions Credit rating was launched in February 2017 and has pursued a strategy centered on pinpointing interesting credit score chances in any market ecosystem and across sectors, leveraging the deal sourcing and infrastructure manufactured accessible from BC Associates.

Cautionary Statement With regards to Ahead-Looking Statements
This communication consists of “forward-looking” statements. Ahead-looking statements issue potential situations and outcomes and other statements that are not historic points and are at times identified by the text “may,” “will,” “should,” “potential,” “intend,” “expect,” “endeavor,” “seek,” “anticipate,” “estimate,” “overestimate,” “underestimate,” “believe,” “could,” “project,” “predict,” “continue,” “target” or other similar terms or expressions. Forward-on the lookout statements are based mostly upon present designs, estimates and expectations that are topic to pitfalls, uncertainties and assumptions. Ought to one particular or far more of these threats or uncertainties materialize, or should really fundamental assumptions verify to be incorrect, true effects may possibly vary materially from all those indicated or predicted by these kinds of ahead-seeking statements. The inclusion of these types of statements ought to not be regarded as a illustration that these designs, estimates or expectations will be achieved. Crucial components that could bring about precise effects to differ materially from such designs, estimates or anticipations consist of people threat things in depth in the Company’s reports filed with the Securities and Trade Fee (“SEC”), which include the Company’s yearly report on Type 10-K, periodic quarterly reviews on Sort 10-Q, recent studies on Sort 8-K and other paperwork filed with the SEC.

Any forward-seeking statements communicate only as of the day of this conversation. The Firm does not undertake any obligation to update any forward-searching statements, regardless of whether as a final result of new info or developments, long term situations or normally, except as necessary by law. Audience are cautioned not to location undue reliance on any of these forward-looking statements.

For more facts, make contact with:

Logan Ridge Finance Company
650 Madison Avenue, 23rd Flooring
New York, NY 10022

Jason Roos
Main Money Officer
Jason.Roos@bcpartners.com
(212) 891-5046

The Fairness Team Inc.
Lena Cati
lcati@equityny.com
(212) 836-9611

Serena Liegey
sliegey@equityny.com
(212) 836-9630

May 2, 2022

SOS Limited Reports 2021 Full Year Financial Results

Revenue Jumps 612{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to $357.8 million

Gross Profit Improves 62.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to $21.1 million

Mining Operations Begin Transitioning to the U.S.

QINGDAO,China, May 2, 2022 /PRNewswire/ — SOS Limited (“SOS” or the “Company”) (NYSE: SOS) today reported its full year financial results for the twelve-months ended December 31, 2021.

Revenue was $357.8 million, 612{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} over the twelve-months ended December 31, 2020. Gross Profit increased to $21.1 million from $13.0 million, over the same period.

Results from Operations

Revenue

Net revenue was $357.8 million, up 612{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} over the prior period. The robust growth of revenue demonstrated the strong and effective execution of the Company’s strategy, mainly due to rapid market expansion and the addition of crypto-mining and commodity trading operations. Growth was driven by taking advantage of our block-chain expertise.

Audited condensed consolidated Statements of comprehensive of loss
(US$ thousands, except share data and per share data, or otherwise noted)
	Twelve months ended
	31-Dec-20	31-Dec-21
	$	$
Revenue	50,317	358,042
Business taxes and surcharges	(28)	(221)
Net revenue	50,289	357,821
Operating costs	(37,295)	(336,752)
Gross profit	12,994	21,070
Gross profit ratio	25.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	5.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

As of December 31, 2021, SOS focused on six product lines including insurance marketing, telecom call centers, bank call center, SaaS services, cryptocurrency mining and commodity trading.

Revenue by products	FY2021		FY2020
Product lines	$”000″	Percentage	$”000″	Percentage
Commodity trading	275,363	77.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	–	0.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
Insurance marketing	65,880	18.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	49,234	97.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
Cryptocurrency mining	15,427	4.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	–	0.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
Telecom call center	338	0.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	920	1.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
Bank call center	–	0.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	76	0.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
SaaS	813	0.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	58	0.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
Total net revenue	357,821	100.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}	50,289	100.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

Our traditional business of insurance marketing increased 34{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to $65.9 million year over year, as a result of rapid market expansion from regional to national customer base in China. We added commodity trading to our product mix during the year. We buy and sell commodity products such as sesame, sulfur, asphalt and circuit modular units. Our trading business recorded revenue of $275.4 million, which represents 77.0{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of total sales. We booked revenue of $15.4 million from our cryptocurrency mining business from a partial year of operation. We started generating revenue from our mining pools in February 2021 and mined 174.28 units of BTC and 2,770.09 units of ETH by the end of the second quarter. In July 2021, due to the Chinese government’s ban on certain types of cryptocurrency mining activities, we shut down our mining operations in China and began transitioning our crypto mining operations to the U.S. The Company launched its U.S. mining operations in Wisconsin this April.

Operating Costs

Operating costs increased to $336.8 million for the period ended December 31, 2021, compared to operating costs of $37.3 million for the period ended December 31, 2020. The increase in operating costs and expenses was driven primarily from the growth in our commodity trading inventory and data acquisition costs for our insurance marketing businesses and a share-based compensation plan. We also saw an increase from depreciation on cryptocurrency mining equipment, consulting and legal fees.

General and Administrative Expenses

General and administrative expenses were $62.4 million for the period ended December 31, 2021, representing an increase of approximately 21.5 times compared to general and administrative expenses of $2.9 million for the period ended December 31, 2020. The increase in general and administrative expenses was mainly associated with employee and management’s share-based compensation expenses of $33.5 million, professional and consultancy fee of $17.1 million, wages & salary expenses of $5.3 million, $1.2 million of bad debt expense and significant increases in legal expenses related to class action lawsuit against the Company and its management.

GAAP Operating Loss and EPS

Our net loss for the period ended December 31, 2021 was $43.9 million according to GAAP, compared to profit of $4.9 million for the period ended December 31, 2020. The loss resulted from increased expenses related to increased operating expenses, legal and consulting fees and share-based compensation expenses. Gross margin dropped to 6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in FY 2021 from 26{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in the prior year driven by the significant growth in the lower margin commodity trading business, increased operating expenses and the interruption of crypto-mining operations.

GAAP EPS Basic was $(0.020) per share for the period ended December 31, 2021, as compared to $0.0135 per share for the period ended December 31, 2020.

GAAP EPS Diluted was $(0.018) per share for the period ended December 31, 2021, as compared to $0.0090 per share for the period ended December 31, 2020.

Income Tax

The company incurred $0.74 million in corporate income tax for the current period.

Balance Sheet and Cash Flow

As of December 31, 2021, the Company had cash and cash equivalents of $338.0 million, compared to $3.7 million for the period ended December 31, 2020. The net increase in cash flow was mainly due to its financing activity through registered direct offerings. The Company believes that its cash resources are adequate to fund its current operations and short-term growth initiatives. The Company, through its subsidiary, SOS International Trading Co., Ltd. purchased commodity for trading inventory of $96.1 million.

Cash Flow Used For Investment Activities

The Company, through its subsidiaries, SOS Information Technology New York Inc. and China SOS Ltd., acquired BTC and ETH mining equipment for an aggregate cost of approximately $31 0 million

Financing Activities

The Company received aggregate net proceeds of US$585.8 million from registered direct offerings during the year.

Audited condensed consolidated statement of cash flow
(US$ thousands, except share data and per share data, or otherwise noted)
	31-Dec-20	31-Dec-21
Cash flows from operating activities:	US$”000″	US$”000″
Net (loss)	4,404	(49,251)
Adjustments:
Depreciation and amortization	2	5,203
Share-based compensation	506	33,537
Depreciation of ROU		843
Accretion of finance leases		152
Allowance for doubtful accounts-accounts receivable	1	963
Allowance for doubtful accounts-Other receivable	158	269
Impairment of cryptocurrencies		925
Loss on acquisition	5,679	–
Income from disposal of discountined operations	(63)
Inventory	–	(96,071)
Changes in operating assets and liabilities:
Accounts receivables	(2,065)	(15,894)
Ohter receivables	(36,019)	(125,861)
Amount due from related parties	(2,871)	(4,146)
crptocurrencies	–	(14,502)
Accrued liabilities	–	19,815
Accounts payable	(11,940)	28,409
Tax payable	292	(8,371)
Other payables	1,484	5,003
Amount due to related parties	(3,666)	868

Contract liability	546	(454)
Lease liabilities
Net cash （used in）in generating from operating activities:	(43,552)	(218,563)
Cash flows from investing activities:
Purchase of property, equipment and software	(501)	(33,034)
Investment in equity	–	0
Disposition of assets	3,500	–

Net cash (used in)generated from investing activities	2,999	(33,034)
Cash flows from financing activities:
Repayment of principle portion of lease liabilities		(1,764.00)
Proceeds from share issuance, net of issuance costs	3,578	585,839
Proceeds from private equity placement,net of issuance costs	39,973	–
Net cash generated from(used in) financing activities	43,551	584,075
Effect of exchange rates on cash	683	1,825
Net increase/(decrease), effect of exchange rate changes on cash and cash equivalent	3,680	334,303
Cash and cash equivalent at beginning of the period	42	3,722
Cash and cash equivalent at end of the period	3,722	338,026

Yandai Wang, the CEO comments that “In the past year, we have provided technical services through artificial intelligence and blockchain technologies by leveraging data-driven marketing, digital based commodity trading, digital supercomputer and emergency rescue technology. Through this we were able to realize revenue of $357.8 million as of December 31,2021, which represents 661{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} growth. over 2020.

In our data marketing business, we rely on artificial intelligence technology & comprehensive intelligent screening to acquire customers more effectively; we also utilize blockchain technology to solve the information security problems to provide customers with one-stop benchmark customer acquisition services; In our digital-based commodity trading segmentt, we make full use of the accurate traceability of blockchain technology, product quality assurance, smart contracts, Intelligent trading matching technology to provides a one-stop trust trading platform for customer trading; in emergency rescue, we team up with some industry experts to invest and design emergency rescue watches, Emergency rescue amphibious rescue boat.

We believe we are well-positioned to grow our business in all segments. Within China we are focused on data-driven insurance marketing, and commodity trading. In U.S. we have launched our supercomputing hosting center in Wisconsin.

Mainland China, as one of the world’s largest markets, demands huge amount of raw material products and food commodities to sustain its long -term growth. In 2020 we established our commodity trading business to bridge supply and demand by providing seamless trading exchange through our block-chain technology and plat-form. We started from green field and are proud to report that our commodity trading business generated revenue of $275million during the twelve -month period ended December 31,2021.

Our aspiration is to expand beyond China especially in North America. We are in the process of building a leading supercomputer center in North America which will provide customers with cryptocurrency mining capacity & hosting service.

One of the tools we used to accelerate this goal is the innovative mobile container data center. We believe it will improve user experience and be attractive to small to medium size customers. Our plans continue to proceed as we have secured a renewable energy supply of 25 MW at its facility in Price County Wisconsin, which is expected to be increased to 37MW.

We look forward to continued growth and expansion in both China and U.S.

About SOS Limited

SOS is an emerging blockchain-based and big data-driven marketing solution provider，SOS is also engaged in blockchain and cryptocurrency operations, which currently include cryptocurrency mining and maybe expand into cryptocurrency security and insurance in the future Since April 2021, we launched commodity trading via our subsidiary SOS International Trading Co. Ltd, The core infrastructure of SOS’ marketing data, technology and solutions to insurance and emergency rescue services is built on big data, blockchain-based technology, cloud computing, AI, satellite, and 5G network, etc. SOS has created a cloud “software as a service (SaaS)” platform for emergency rescue services, with three major product categories: basic cloud, cooperative cloud, and information cloud. This system provides innovative marketing solutions to clients such as insurance companies, financial institutions, medical institutions, healthcare providers, auto manufacturers, security providers, senior living assistance providers, and other service providers in the emergency rescue services industry. For more information, please visit: http://www.sosyun.com/ .

Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws, including, but not limited to, our expectations for future financial performance, business strategies or expectations for our business. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. SOS cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Words such as “may,” “can,” “should,” “will,” “estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “seek,” “target,” “look” or similar expressions may identify forward-looking statements. Specifically, forward-looking statements may include statements relating to the Company’s:

ability to execute its business plan;
changes in the market for SOS’ products and services; and
expansion plans and opportunities.

These forward-looking statements are based on information available as of the date of this press release and our management’s current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.

These risks and uncertainties include, but not are limited to, the risk factors described by SOS in its filings with the Securities and Exchange Commission (“SEC”). These risk factors and those identified elsewhere in this press release, among others, could cause actual results to differ materially from historical performance and include, but are not limited to:

US government’s policies and regulatory oversight of crypto currency mining operation and our other operations;
SOS’s cryptocurrency mining, commodity trading and marketing solutions businesses are still under development, with many uncertainties in integration of these various business segments;
Failure to manage the newly launched commodities trading business effectively;
Loss of key customers in the commodity trading business;
failure to access a large quantity of power at reasonable costs could significantly increase SOS operating expenses and adversely affect our demand for SOS’s mining activities;
shortages in, or rises in the prices of mining machines may adversely affect the Company’s business;
any significant or prolonged failure in the data warehouse facilities and data mining facilities that SOS operates or services it provides, including events beyond its control, would lead to significant costs and disruptions and would reduce the attractiveness of its facilities, harm its business reputation and have a material adverse effect on its results of operation;
security breaches or alleged security breaches of our data warehouses could disrupt SOS operations and have a material adverse effect on its business, financial condition and results of operation; and
other risks and uncertainties indicated in SOS’s SEC reports or documents filed or to be filed with the SEC by SOS.

Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and you should not place undue reliance on these forward-looking statements in deciding whether to invest in our securities. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Cision

View original content:https://www.prnewswire.com/news-releases/sos-limited-reports-2021-full-year-financial-results-301537455.html

SOURCE SOS Limited

April 22, 2022

You May Not Be Using AI to Its Full Potential

The innovations in computing capacity and artificial intelligence have prolonged been hailed as a great performance enhance for wealth advisors and their clientele.

Whilst almost all advisors acknowledge the implicit benefit of integrating AI into their every day follow, most AI adoption has either been by way of robo advisors (Wealthfront and Betterment) or “intelligent” purchaser provider (think chatbots).

The rise in design portfolios and manager variety has relieved advisors of the sole emphasis on unique equities, but shoppers continue to want insights on their beloved names (TSLA, AAPL, BTC). In addition, advisors with in-dwelling investigate want to be equipped to give the comprehensive context at the rear of analyst updates/downgrades or cost goal changes and, as a result, have to dig through a mountain of PDFs and collate details from disparate resources in buy to reply consumer thoughts and be found as price-insert.

In the earlier, advisors with access to a committed information terminal could promptly access news and information their customers weren’t observing. Nonetheless, more than the several years, the commodification and proliferation of news and info (together with *cringe* “fake news”) has intended that consumers usually have obtain to the identical information as their advisors. This shift implies that the benefit of premium providers now comes from mining terabytes of data to locate what is actually impacting a stock or bond. In other phrases, the value proposition advisors supply is to change uncooked facts (information, sector rates) into insights tailored to each client’s portfolio.

More businesses are featuring options to navigate this house, having advantage of cloud computing to narrow down news tales to individuals that will likely impact the trading activity of the underlying asset. AI goes just one step further, in delivering the necessary inputs to make it possible for an advisor to not only describe what’s transferring the stock but also what is probable to occur future. The identical process is being leveraged with design portfolios as advisors look to reshape allocations. Rather than painstaking handbook operate across spreadsheets and plans, advisors are utilizing click on-by way of application to simply take a look at how diverse weightings will react throughout all varieties of situations and macro environments.

This ability to leverage equipment understanding to observe client portfolios in a scalable fashion gets priceless as advisors regulate upwards of 200-as well as consumer relationships, whilst also balancing escalating business advancement and back-place of work duties.

The long term of the market will have to be in relying on your personal computer to remind you who to simply call, when and why. The assessment machines develop can lead to compelling insights to your shoppers on a scale unimaginable if carried out manually. That is the clear use scenario winner for AI in prosperity administration.

The doomsday predictions that robos would threaten the livelihood of economical advisors have finally proved fake, but it’s increasingly distinct that advisors who immediately and intelligently combine AI into their observe are fast gaining an edge on the level of competition.

Jan Szilagyi is CEO and co-founder of Toggle. He is a former quant trader at Duquesne Capital.

April 1, 2022

The Parent Company Reports Fourth Quarter and Full Year 2021 Financial Results

Doubled Direct-to-Consumer revenue to 50{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of net sales in Q4 2021 compared with 24{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in Q1 2021

Expanded reach to over 80{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of California population with 11 retail stores, the second largest retail footprint in the state, 6 delivery depots and an immersive mobile shopping app

Appoints Tanisha Robinson as Chief Transformation Officer and Esther Song as Chief Marketing Officer

Conference Call to be Held, April 1, 2022, at 1:00 p.m. ET

SAN JOSE, Calif., March 31, 2022 /CNW/ – TPCO Holding Corp. (“The Parent Company” or the “Company”) (NEO: GRAM.U) (OTCQX: GRAMF), a leading consumer-focused California cannabis company, today announced its financial results for the fourth quarter (“Q4 2021”) and full year (“FY 2021”) ended December 31, 2021. All amounts are expressed in U.S. dollars.

The Parent Company (CNW Group/TPCO Holding Corp.)

Q4 2021 Financial Highlights

Net sales for Q4 2021 were $39.6 million
Gross profit for Q4 2021 was $2.3 million, or 6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of net sales
Net (income) loss and comprehensive (income) loss for Q4 2021 was $50.6 million
Adjusted EBITDA loss for Q4 2021 was $27.5 million. Adjusted EBITDA removes the effects of changes in fair value of financial instruments, impairment charges and other non-cash items.

FY 2021 Financial Highlights

Net sales for FY 2021 were $173.4 million
DTC Revenue for FY 2021 was $54.2 million or 31{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of sales
Wholesale revenue for FY 2021 was $119.2 million of 69{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of sales
Gross profit for FY 2021 was $20.2 million or 12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of net sales
Net (income) loss and comprehensive (income) loss for FY 2021 was $587 million
Adjusted EBITDA loss for FY 2021 was $62 million.
Unrestricted Cash and equivalents totaled $165.3 million as of December 31, 2021

Management Commentary

“2021 was a foundational year, as we developed an integrated omnichannel retail platform that provides us with direct access to over 80{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of California’s adult population, positioning us to execute on our goal of becoming the number one choice for consumers by providing for both ease of access and high-quality innovative cannabis products,” said Troy Datcher, Chief Executive Officer of The Parent Company. “We have added significant talent to our organization, including industry experts and seasoned professionals that provide us with the depth of knowledge and expertise we need to lead in this market. Talent is incredibly important, and we are extremely proud of the caliber of team we have assembled. I also want to thank our entire team for the work they have done over the last year, which was instrumental in strongly positioning us for 2022 and beyond.”

Mr. Datcher continued, “While the challenges in the California market remain, including low bulk wholesale flower and oil pricing, high taxes and persisting illicit market, we have successfully begun to pivot our focus to our higher margin direct to consumer revenue, doubling DTC revenue as a percentage of sales between the first and fourth quarters. Today more than ever, we believe we are well positioned to win by leveraging our high-quality indoor grown cannabis, strong consumer brands and direct retail insights to innovate, create, and launch new products directly into the market that today’s consumers demand.”

Mr. Datcher added, “With our consumer-first approach, state-wide DTC retail footprint, robust branded products portfolio, and focus on higher value revenue streams, our priority for the remainder of the year will be preserving our strong balance sheet by reducing our cash burn while utilizing our DTC focus to drive improved margin to generate long-term value for our shareholders. Given our progress in 2021 and subject to any opportunistic partnership or acquisition transactions, we have set a goal to maintain a minimum cash balance of approximately $100 million at 2022 year end, sufficient to sustain our business for a minimum of three years, and pivot to generating positive cash flow in fiscal year 2023.”

Mr. Datcher concluded, “I am proud of our commitment to social equity initiatives and thrilled with the initial success of our partners. I look forward to empowering more entrepreneurs of color, who continue to be disproportionately impacted by current cannabis policies, while bringing our customers high-quality products, experiences, and culturally relevant brands. With the investments we made in 2021, we are ready to execute on this mission in 2022.”

Leadership Team Appointments and Board Changes

The Company further announced today the appointments of Tanisha Robinson as Chief Transformation Officer and Esther Song as Chief Marketing Officer. Additionally, the Company announced that Troy Datcher, Chief Executive Officer of The Parent Company, will be proposed as a director nominee to stand for election to the Board of Directors as Carol Bartz and Jeffry Allen have advised their intention to retire from the Board at the Company’s upcoming 2022 Annual meeting.

Mr. Datcher commented, “I am thrilled to officially welcome Tanisha and Esther to the team. We are proactively building a solid foundation for long term success, and I look forward to leveraging Tanisha and Esther’s extensive industry expertise to further mature and scale our organization. I’m confident we have assembled the right combination of high-quality products, compelling consumer brands, and leadership team to achieve our goals.

Ms. Robinson founded W*nder (pronounced “Wonder”), a company focused on creating accessible, reliable, intuitive cannabis and plant-based beverages to enhance and improve how consumers experience the world. Prior to her role at W*nder, she worked as Chief Disruption Officer of BrewDog globally, and was the first CEO of BrewDog USA, leading the company from its initial startup phase to becoming one of the largest and fastest growing craft breweries in the United States. In addition to her experience at W*nder and BrewDog, Ms. Robinson has founded several successful companies such as Print Syndicate, a design, technology, and marketing company, and TicketFire, a mobile app that allows consumers to use, transfer and sell paper tickets by converting them to a mobile format. Robinson also served in the US Army as an Arabic linguist. Her studies in Arabic at Ohio State University provided her the opportunity to work on women’s and human rights in Damascus, Syria, for two years. She is a featured international speaker on entrepreneurship, conscious capitalism, innovation, disruption and leadership and serves on the board of The Columbus College of Art and Design (“CCAD”) and Mount Carmel Health System.

Ms. Song has established expertise in public relations and marketing from over 20 years of experience in building brand visibility through strategic communications and global marketing campaigns, prioritizing direct consumer relationship building through loyalty programs and authentic storytelling. Prior to joining TPCO, she held the position of Chief Marketing Officer for Pure Beauty, and prior to that, similar roles at Canndescent and MedMen. During her time at MedMen, Song successfully launched a multi-state loyalty program and an integrated system allowing delivery and curbside services. In addition to her experience at MedMen, Song also led global digital and VIP public relations at fashion brands, including Tory Burch, Tod’s and public relations agency, BPCM. Song is currently on the leadership team of Cannabis for Black Lives.

Q4 2021 Operational Highlights

Expanded the Company’s California retail footprint to over 80{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of the population through definitive agreements to acquire Coastal Holding Company, LLC (“Coastal”), a retail dispensary license holder and operator with six retail licensed locations, five currently operating, and two delivery depots.
In preparation of potentially being permitted to list the Company’s common shares and warrants on the New York Stock Exchange or the Nasdaq Stock Market upon regulatory advancement, the Company’s filed its Form 10 registration statement with the United States Securities and Exchange Commission (the “SEC”), which became effective pursuant to the Securities Exchange Act of 1934, as amended on October 8, 2021.
Further strengthened the senior management team with the appointments of Kerry Arnold as Chief People Officer of the Company and Tiffany McBride as Managing Director of Social Equity Ventures.
Expanded suite of edible offerings with the launch of DELI Dimes, a new gummy cannabis product available in three flavors: Black Cherry, Fresh Watermelon and Red Berry.

Subsequent Events

On January 28^th, Company insiders, including the entire Board of Directors, Troy Datcher, Chief Executive Officer, Mike Batesole, Chief Financial Officer and other members of the senior leadership team, voluntarily entered into a twelve-month extension of lock-up agreements with the Company (the “Lock-Up Agreements”) with respect to an aggregate of over 34 million shares of common stock (“Lock-up Shares”), or approximately 35 {21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of the total issued and outstanding shares of common stock of the Company as of July 28, 2021.

FY 2021 Financial Results

Net sales for FY 2021 were $173.4 million, of which $54.2 million was Direct to Consumer sales, and $119.2 million was Wholesale.

Gross profit for FY 2021 was $20.2 million, representing gross margin of 12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The Company continues to focus on increasing direct-to-consumer sales as a percentage of overall revenue, to shift its sales to higher margin product categories, which over time, is expected to drive gross profit improvements.

Operating expenses for FY 2021 were $184.4 million, cash expenses included general and administrative costs of $47.3 million, salaries and benefits of $36.9 million, and sales and marketing expenses of $42.6 million. Non-cash expenses included: sales and marketing $30.2 million, stock-based compensation of $20.5 million, allowance for bad debts of $4.7 million and depreciation & amortization of $27.6 million.

Net (income) loss and comprehensive (income) loss for FY 2021 was $587 million, which is primarily attributable to non-cash impairment charges of $654.3 million.

Adjusted EBITDA loss for FY 2021 was $62 million. The Adjusted EBITDA loss in 2021 was primarily attributable to the closing of the Qualifying Transaction and the integration initiatives undertaken since the closing.

Unrestricted Cash and cash equivalents totaled $165.3 million as of December 31, 2021. Since closing the Company’s qualifying transaction, the Company has invested $48.8 million in acquisitions and capital investments, $6.5 million to repurchase its own shares and $81.9 million or an average of $6.8 million of cash per month on operations as it integrates and scales its businesses.

The Company’s consolidated financial statements, as well as its accompanying management discussion and analysis of financial condition and results of operations (“MD&A”) have been included in its Annual Report on Form 10-K filed on EDGAR (www.sec.gov) as well as SEDAR (www.sedar.com). Please refer to The Parent Company’s MD&A for additional detail and discussion on the Company’s results from operations.

Conference Call

The Parent Company will host a conference call tomorrow, to discuss these results. Troy Datcher, Chief Executive Officer, and Mike Batesole, Chief Financial Officer will host the call starting at 1:00 p.m. Eastern time. A question-and-answer session will follow management’s prepared remarks.

DATE:	Friday, April 1^st, 2022
TIME:	1:00 p.m. Eastern Time
WEBCAST:	Click Here
DIAL-IN NUMBER:	(888) 254-3590 or (647) 794-4605
CONFERENCE ID:	2151082
REPLAY:	1 (888) 203-1112 or 1 (647)-436-0148 Available until 12:00 midnight Eastern Time Friday, April 8, 2022 Replay Code: 2151082

Financial results and analyses are available on the Company’s website (ir.theparent.co), EDGAR (www.sec.gov) and SEDAR (www.sedar.com).

About The Parent Company

Formed in January 2021, The Parent Company is a leading consumer-focused California cannabis company. The company’s three manufacturing facilities provide unparalleled access to high-quality, low-cost cannabis, while its vast wholesale distribution network of more than 450 California dispensaries, a direct-to-consumer omnichannel platform, six consumer delivery hubs and eleven omni-channel retail locations, currently service approximately 80{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of the largest legal cannabis market in the country. The Company’s curated product portfolio includes eight valuable and scalable brands, including Monogram by Shawn “JAY-Z” Carter, Caliva, Deli, Fun Uncle, and Mirayo, which sets the tone for The Parent Company’s industry leadership in California and beyond.

In addition to its vast manufacturing infrastructure, consumer reach and cultural influence, The Parent Company is committed to using its resources and status to play a significant role in molding a more equitable cannabis industry. Its social equity ventures initiative, established by Chief Visionary Officer Shawn “JAY-Z” Carter, was created to break down the systematic barriers Black and other minority entrepreneurs face as they endeavor to secure meaningful participation, growth and leadership in the multibillion-dollar legal cannabis industry.

Shares of The Parent Company common stock are traded on NEO Exchange under the ticker symbol “GRAM.U” and on the OTCQX under the ticker symbol “GRAMF”.

For the latest news, activities, and media coverage, please visit www.theparent.co or connect with us on Instagram, LinkedIn, and Twitter.

Forward Looking Statements

This press release may contain forward-looking information within the meaning of applicable securities legislation which reflects The Parent Company’s current expectations regarding future events. The words “will”, “expects”, “intends”, “believes” and similar expressions are often intended to identify forward looking information, although not all forward-looking information contains these identifying words.

Specific forward-looking information contained in this press release includes, but is not limited to, statements concerning (i) the Company’s future financial performance (ii) ability of The Parent Company to execute on its growth strategy; (iii) expectations regarding future corporate development activities; (iv) expectation regarding U.S. listing and regulatory landscape; and (v) expansion of the Company’s direct-to-consumer line of its business. 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 Parent Company’s control, which 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: changes in general economic, business and political conditions, changes in applicable laws, the U.S. and Canadian regulatory landscapes and enforcement related to cannabis, changes in public opinion and perception of the cannabis industry, reliance on the expertise and judgment of senior management, as well as the factors discussed under the heading “Risk Factors” in The Parent Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2022, which is available on the SEC’s website at www.sec.gov and on SEDAR at www.sedar.com. The Parent Company undertakes no 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.

Non-GAAP Financial Measures

This news release contains the non-GAAP financial measure “Adjusted EBITDA,” which is not recognized under GAAP and does not have a standardized meaning prescribed by GAAP. As a result, this measure may not be comparable to similar measures presented by other companies. For a reconciliation of “Adjusted EBITDA” to the most directly comparable financial information presented in the Financial Statements in accordance with GAAP, see the section entitled “Reconciliation of Non-GAAP Measures” below.

Adjusted EBITDA

We believe Adjusted EBITDA is a useful measure to assess the performance of the Company as it provides more meaningful operating results by excluding the effects of expenses that are not reflective of our underlying business performance and other one-time or non-recurring expenses. We define Adjusted EBITDA as net income (loss) before (i) depreciation and amortization; (ii) income taxes; and (iii) interest expense and debt amortization, adjusted to exclude extraordinary items, non-recurring items and, other non-cash items, including, but not limited to (i) stock-based compensation expense, (ii) fair value change in contingent consideration and investments measured at Fair Value Through Profit and Loss (” FVTPL”), (iii) non-recurring legal and professional fees, human-resources, inventory and collections-related expenses, (iv) extra ordinary expenses related to COVID-19, (v) intangible and goodwill impairments and loss on disposal of assets, (vi) transaction costs related to merger and acquisition activities, and (vii) non-cash sales and marketing expenses.

Reconciliation of Non-GAAP Measures

		Three Months			Year-ended
		December 31, 2021	December 31, 2020		December 31, 2021		December 31, 2020
Net loss and comprehensive loss	$	(50,568,037)	(7,913,227)	$	(587,032,334)	$	(6,463,606)
Income taxes		5,645,521	–		(2,372,552)		–
Depreciation and amortization		8,790,536	–		27,615,762		–
Interest expense		1,455,241	–		5,183,817		–
EBITDA		(34,676,739)	(7,913,227)		(556,605,307)		(6,463,606)
Adjustments:		–
Share based compensation expense		3,005,477	–		20,456,297		–
Other non-recurring items:		–
Fair value change of contingent consideration		(8,821,983)	–		(229,819,070)		–
Loss on disposal of assets		(1,208,722)	–		2,447,985		–
Change in fair value of investments at FVTPL		832,172	–		1,250,990		–
Impairment loss		9,118,146	–		654,317,300		–
Provision for notes receivable		2,660,943	–		2,660,943		–
Write-off of prepaid inventory		1,620,891	–		1,620,891		–
Other taxes		–	–		2,243,441		–
De-SPAC costs		–	–		5,341,154		–
Restructuring costs		–	–		3,878,782		–
Sales and marketing expense		15,520	–		30,166,667		–
Adjusted EBITDA	$	(27,454,295)	(7,913,227)	$	(62,039,927)	$	(6,463,606)

Caution Regarding Cannabis Operations in the United States

Investors should note that there are significant legal restrictions and regulations that govern the cannabis industry in the United States. Cannabis remains a Schedule I drug under the U.S. Controlled Substances Act, making it illegal under federal law in the United States to, among other things, cultivate, distribute, or possess cannabis in the United States. Financial transactions involving proceeds generated by, or intended to promote, cannabis-related business activities in the United States may form the basis for prosecution under applicable U.S. federal money laundering legislation.

While the approach to enforcement of such laws by the federal government in the United States has trended toward non-enforcement against individuals and businesses that comply with medical or adult-use cannabis programs in states where such programs are legal, strict compliance with state laws with respect to cannabis will neither absolve The Parent Company of liability under U.S. federal law, nor will it provide a defense to any federal proceeding which may be brought against the Company. The enforcement of federal laws in the United States is a significant risk to the business of The Parent Company and any proceedings brought against the Company thereunder may adversely affect the Company’s operations and financial performance.

SOURCE TPCO Holding Corp.

Cision

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