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good natured Products Inc. Annual Letter to Owners Covers 2021 Highlights and Outlook for 2022

February 15, 2022 — (Vancouver, BC) good natured Products Inc. (the “Company” or “good natured®”) (TSX-V: GDNP), a North American leader in plant-based products and packaging, today released its annual letter to shareholders from Paul Antoniadis, the Company’s CEO.

Dear Owners,

As always, I’d like to start by expressing my sincere appreciation for your commitment to good natured® and trusting us to be stewards of your sustainable investing dollars. This is your company, and on behalf of our 200+ employees I want to personally thank you for your trust and partnership on our path to building North America’s leading earth-friendly product company.

With ESG investment opportunities becoming more common, we hope our 7-year track record of delivering on our growth strategy has made us – and will continue to make us – stand out from the crowd. Helping our customers achieve their sustainable development goals remains at the core of what we do, and your capital contribution plays an invaluable role in creating positive economic, environmental, and social impact for all our stakeholders and the families who depend on us.

We’re kicking off 2022 with the same courage and conviction to aggressively grow our topline revenue, both organically and through acquisition, with targeted gross margins in the 21% to 28% range and annual improvements in EBITDA. We anticipate continued global supply chain disruptions, external inflation, and fluctuation in our market valuation in 2022 (both up and down). Our keen focus on execution, providing great service, and managing operational excellence is our “superpower” and path to success. I’ve been so impressed with our team’s demonstrated ability to stay focused on our strategic objectives, adapt quickly and continue to achieve our operational targets.

We passionately believe that the key to making annually renewable, plant-based materials truly mainstream must be about more than just the ingredients. We’re in the business of making better everyday products®, which means they’re designed to deliver great performance and do less environmental harm, while also making it easy and affordable for customers to make the switch. Every year, we assess what initiatives will be most meaningful in the current market conditions to grow and maintain a strong competitive advantage. In 2022, we anticipate this to include continued and purposeful expansion of our sustainable product and service portfolio, along with key technology investments to enhance our operational capabilities and deploy predictive tools to deliver “anticipatory service” to our customers.

Our strategic acquisitions in 2020 and 2021, along with capital deployed toward high-speed manufacturing technology, are solidifying good natured® as a market leader with robust supply chain capabilities in Canada and the United States. Investments in robotics and manufacturing automation will also increase high value, skilled employment opportunities in our local communities. These initiatives position the Company to deliver our 2022 plan by enhancing manufacturing capability for our existing customers and paving the way to add new organic customers to deliver our revenue growth objectives. Many prospective customers are urgently seeking to re-shore their supply chain to de-risk global disruptions, creating a substantial pool of additional addressable markets for the Company in the immediate future.

The year ahead will not be without challenges and unforeseen circumstances. Economic and operating conditions are far from normal (although we all might be actively re-examining what “normal” is). Our team loves taking on new challenges and takes an unconventional approach to lean into emerging opportunities when things are tough, so we’re incredibly energized for what’s coming in 2022!

2021 – The Year in Review

This past year was truly one of the most challenging and rewarding operating environments I’ve experienced in my professional career. It was humbling to witness our team’s commitment to repeatedly overcoming obstacles caused by persistent external inflationary pressures and supply chain disruptions to achieve record-breaking annual revenue. We completed our largest acquisition, delivered strong organic customer growth, launched a broad series of new sustainable products, invested in high-speed manufacturing technology, and stayed on top of our cash, inventory and production requirements despite constantly fluctuating macro and micro-economic conditions,

As noted in our press release dated January 20, 2022, we ended the 2021 fiscal year with fantastic momentum and anticipated annual revenue growth of 255% to 270%, for the year ended December 31, 2021 (“FY2021”) compared to the year ended December 31, 2020 (“FY2020”); plus, FY2021 revenue expected to range between $59.3 million to $61.3 million. Variable gross margin, a non-GAAP measure, for FY2021 is anticipated between 30% and 32%, while gross margin for FY2021 is estimated to land between 24% and 26% for the full year. These are preliminary and unaudited revenue and gross margin estimates prepared by the Company for FY2021.

Our strategy remains centered on organic initiatives contributing 50% of our revenue growth and acquisitions delivering the remaining 50%. Our results in 2021 are more heavily weighted to acquisition revenue due to the timing of completing two major acquisitions – IPF in December 2020 and Ex-Tech in May 2021. I don’t want to let the strong execution of our acquisition strategy overshadow the tremendous success achieved on the organic side. By December 2021, we’d more than doubled the number of active, recurring business customers compared to the 2020 year end, and our customer mix has become larger and more diverse than any other time in the history of the Company. Compared to any prior period, we’re less reliant on any one customer to deliver our growth numbers, and have a healthy, highly varied pipeline of future opportunities that makes us more resilient in unstable market conditions.

Our 2021 share price performance can only be described as a roller coaster, and we appreciate those who’ve had the stomach for the full ride! After a very strong start to the year and reaching a record market capitalization of $400+ million in February 2021, our market capitalization was down ~12% at year end 2021 versus year end 2020. As owners ourselves, with management and insiders representing 23% of shares outstanding, we’re keenly focused on creating both positive environmental impact and long-term economic value. Despite the fluctuations of 2021, our 3-year market capitalization has grown from approximately $10 million at the end of 2018 to approximately $172 million at the end of 2021, representing an increase of over 1,600%. Our liquidity has also improved significantly, with average daily volume in 2021 having increased over 1,200% from 2018.

We’re also very pleased to have increased our analyst and research coverage to a total of seven firms in 2021, including the first from a Schedule I bank in Canada. We were also able to attract several new institutional investors and family offices to invest in the company’s stock. This has broadened our base of long-term investors

2021 Highlights

  • Acquired Ex-Tech Plastics Inc., a US manufacturer of high quality, rigid plastic sheets with almost 40 years of operations. The acquisition significantly increased our capacity to produce plant-based rollstock that we use to make our rigid thermoformed packaging, added 105 customers, and FY2020 revenue of approximately $33 million, adjusted EBITDA of US$2.6 million, and net income of US$1.5 million.
  • Announced commencement of shipments to our largest organic commercial customer, a national US food producer, expected to generate USD$13 million in its first year,
  • Successfully completed a $17.25 million convertible debenture financing and a $35.8 million senior credit facility, inclusive of a $10 million uncommitted accordion, with National Bank, materially reducing the blended interest rate paid on our long-term debt and principal repayments due over the next three years.
  • Announced partnership with Jones Healthcare Group, a market leader in advanced packaging and medication dispensing solutions, to focused on expanding sustainable packaging solutions. Jones’ blister packaging products will now be made with good natured® Bio-PET, a food-safe, curbside recyclable bioplastic material.
  • Purchased high-speed manufacturing equipment that is anticipated to be operational in Q1 of 2022 and grow annual production capacity at our IPF facility by 50% to 33 to 35 million pounds.
  • Purchased high-speed thermoforming manufacturing technology that is anticipated to be installed and operational at our Shepherd facility in Q2 of 2022.
  • Announced good natured® as recipient of Deloitte’s Clean Technology award, a new award category in the Technology Fast 50 program that recognizes Canada’s top clean innovators. The Company was also named to Deloitte’s North American Technology Fast 500 category, recognizing our 460% revenue growth between 2017 and 2020,
  • Along with a multitude of plant-based food packaging products, launched a line of plant-based Bin Bags, Zipper Bags and retail-packed Compostable Tableware, expanding our general merchandise assortment for direct-to-consumer and in-store retail locations across North America.
  • Ranked among the TSX Venture Exchange’s top 50 best performing companies. Presented by the TSX Venture Exchange, good natured® was ranked 4th in the Clean Technology & Life Sciences sector based on three equally weighted criteria: market capitalization growth, share price appreciation and trading volume amount,
  • As part of the organic growth segment, added Better Bites Bakery, an Austin, Texas-based producer of plant-based treats free from the top 8 allergens with nationwide US distribution to retailers such as Kroger, Whole Foods Market, Super Target, Costco and H-E-B.
  • Launched Canada’s first compostable and microwavable plant-based take-out containers in response to Canada’s proposed single-use plastic ban as well as Canada and US Plastics Pact guidelines.
  • Highlighted new customer acquisitions in fast growing emerging industries. such as meal kits (Simple Feast and Vegano), high-tech growers (Heron Farms and ColdAcre).
  • Launched our plant-based Bio-PET material, containing 20-30% plant-based content, up to 50% recycled content and readily accepted in curbside recycling programs across North America.
  • Successfully completed and upsized $23.1 million bought deal short form prospectus financing in March 2021.

2022 – A Look at What’s Next

Our 2022 plan stays true to our long-term strategy of delivering aggressive revenue growth, gross margins within our targeted range and annual improvements in EBITDA, while concurrently fueling positive environmental impact and growing value for our owners.

The acquisition of Ex-Tech in May 2021 added approximately $33 million in trailing 12-month revenue (as at December 2020) and essentially doubled the size of the Company. Annualized revenue from this acquisition and several organic customers already puts us in a strong position to successfully deliver another year of very strong revenue growth. Any potential future acquisitions or additional organic growth from our active sales pipeline will be incremental.

Executing our 2022 plan will also result in a re-balancing of our revenue mix by business group. With the recent IPF and Ex-Tech acquisitions, our Industrial business group became a larger percentage of our total revenue. As we deploy more manufacturing capability toward our own operations, we anticipate our packaging, general merchandise, commercial/business supplies, and associated services will contribute higher percentages of overall revenue mix in 2022.

Our 2021 capital investments in high-speed manufacturing and automation technology will position us well to support our planned revenue growth in 2022. We expect this equipment to be fully operational over the course of the first and second quarter of 2022 and anticipate additional investments in manufacturing, robotics, and operational technology in 2022. These strategic investments will drive operational efficiencies, position us as an emerging leader in domestic, high-tech manufacturing of sustainable products and create the pathway to continued revenue growth and EBITDA improvements in 2023.

Our 2022 plan also includes continued progress toward upgrading our technology platforms and the creation of real-time access to financial data, metrics and business insights. To that end, good natured® will be implementing a new ERP (Enterprise Resource Planning) system that is expected to be fully functional in 2023. This system will provide comprehensive access to AI-enabled planning and decision-making tools across the Company’s growing number of locations and be deployed as part of the Enterprise tech stack with any future acquisitions.

We remain committed to driving alignment between our owners, our board, and our operating team members. Our unique, “good natured” culture plays a big role in helping us achieve a higher level of cohesion and common purpose, along with strong differentiation against competitors. We’re here to deliver long term economic value as owners and make a positive contribution to the environment, and our team is rewarded accordingly to keep us moving together toward these collective goals.

Thank you for your dedication, passion and support that have enabled us to execute our strategic goals in 2021 and position the Company for success in 2022 and beyond. For those of you who are not on our regular communications list, I encourage you to subscribe to our investor newsletter at the link below to receive updates about our 2022 progress as it happens:


Paul Antoniadis

good natured Products Inc.

CEO & Executive Chair


The good natured® corporate profile can be found at:


About good natured Products Inc.

good natured® is passionately pursuing its goal of becoming North America’s leading earth-friendly product company by offering the broadest assortment of eco-friendly options made from plants instead of petroleum. We’re all about making it easy and affordable for business owners and consumers to switch to better everyday products® made from renewable materials and free from chemicals of concern.

Part of the sustainable consumer goods market, good natured® offers over 400 products and services through wholesale and retail channels, including our own e-commerce stores. From plant-based home organization products to compostable food containers, bioplastic industrial supplies and medical packaging, we’re focused on delivering a great customer experience to make more plant-based products readily accessible to more people as the path to deliver meaningful environmental and social impact.

For more information:

Investor Contact:
Spencer Churchill
Investor Relations
1-877-286-0617 ext. 113

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibilities for the adequacy or accuracy of this release.

Non-GAAP financial measures

We have included in this press release certain non-GAAP measures that are used to evaluate the performance of business, including adjusted EBITDA. As non-GAAP measures generally do not have a standardized meaning, they may not be comparable to similar measures presented by other issuers. Adjusted EBITDA does not have a generally accepted industry definition.

Cautionary Statement Regarding Forward-Looking Information

We have included in this press release certain non-GAAP financial measures and ratios that provide what management believes are meaningful comparisons of the Company’s performance, including adjusted EBITDA and variable gross margin.

In this release, variable gross margin is gross margin excluding fixed production costs such as depreciation, repairs and maintenance, utilities and similar overhead items. The use of variable gross margin by management allows for evaluation of the core aspects of the Company’s profit margin as certain fixed production costs that are outside the Company’s control are excluded. Management believes variable gross margin provides an accurate measure of the Company’s product margin contribution by removing fixed factory overhead. Variable gross margin provides deeper insight into normalized product margins related to variable material input costs, inbound freight and labour costs associated with producing the goods being sold. Variable gross margin also removes gross margin percentage fluctuations due to changes in revenue from factors such as mix of insourced versus outsourced manufacturing to respond to specific customer requirements for multiple-facility production, depreciation from facility capital investments and the addition of manufacturing facility acquisitions with factory overhead charges.

In this release, adjusted EBITDA is earnings before interest and finance costs, taxes, depreciation and amortization, other non–cash items and one–time gains and losses. The use of adjusted EBITDA by management allows for evaluation of principal business activities as certain non-core items such as interest and finance costs, taxes, depreciation and amortization, and other non-cash items and one-time gains and losses are removed. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors and other stakeholders also use this non-IFRS measure as information to evaluate the Company’s operating and financial performance. Adjusted EBITDA provides an indication of the Company’s continuing capacity to generate income from operations before considering the Company’s financing decisions, share compensation, costs of amortizing capital assets and other significant or unusual items. With the Company being keenly focused on revenue growth, adjusted EBITDA provides management a valuable, normalized metric for the evaluation of ongoing operating performance, strategic decisions and future operating plans.

As non-GAAP financial measures or ratios generally, including variable gross margin and adjusted EBITDA do not have a standardized meanings under the financial reporting framework used to prepare the Company’s financial statements, they may not be comparable to similar measures presented by other issuers.

The following table provides a reconciliation of preliminary and historic gross margin to preliminary and historic variable gross margin (expressed in thousands of dollars):

For more information regarding non-GAAP measures included in this news release, please refer to “Non-GAAP financial measures” below.

For more information regarding non-GAAP measures included in this news release, please refer to “Non-GAAP financial measures” below:

The following table provides a reconciliation of Ex-Tech’s FY2020 net income to adjusted EBITDA:

Cautionary Statement Regarding Forward-Looking Information

Certain statements in this release are not based on historical facts and constitute forward-looking information, as defined in securities laws. Forward-looking information is not a promise or guarantee of future performance but is only a prediction that relates to future events, conditions or circumstances or the Company’s future results, performance, achievements or developments and is subject to substantial known and unknown risks, assumptions, uncertainties and other factors that could cause the Company’s actual results, performance, achievements or developments in its business or industry to differ materially from those expressed, anticipated or implied by such forward-looking information.

Forward-looking statements in this release include information regarding preliminary financial results, future gross margins, the Company’s 2022 plans, the potential benefits expected from the Company’s previous investments and plans to expand our business organically or through acquisitions contained in this press release may constitute forward-looking information within the meaning of securities laws. Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made.

The forward-looking statements in this release are based on certain factors and assumptions regarding expected growth, results of operations, performance and business prospects and opportunities. Specifically, management has assumed that the Company’s performance will meet management’s internal projections. While management considers these assumptions to be reasonable based on information currently available to us, they may prove to be incorrect. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date. All forward-looking information contained in this news release is expressly qualified in its entirety by this cautionary statement.

Other than as required under securities laws, we do not undertake to update this information at any particular time.

The estimates of FY2021 revenues and variable gross margins, as well as the estimated yearly revenues from the Company’s largest organic commercial customer, a national US food producer, contained in this release were approved by management on January 19, 2022 and October 11, 2021 respectively.