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Safe Harbor Financial Announces Preliminary Fourth Quarter and Full Year 2022 Financial Results

- Full year revenue increased 34% to $9.4 million, number of active accounts increased 82% to 1040 compared to 2021 -

- Recent agreement to resolve $64.7 million in payment obligations significantly strengthens balance sheet, strongly positions the Company for further growth in 2023 -

GOLDEN, Colo., March 30, 2023 (GLOBE NEWSWIRE) -- SHF Holdings, Inc., d/b/a/ Safe Harbor Financial (“Safe Harbor” or the “Company”) (NASDAQ: SHFS), a leader in facilitating banking, payments, and financial services to the regulated cannabis industry, today announced certain preliminary (unaudited) financial results for the quarter and year ended December 31, 2022. All financial information is provided in U.S. dollars unless otherwise indicated and is prepared under U.S. Generally Accepted Accounting Principles (“GAAP”).

Full Year 2022 Financial Highlights1

  • Revenue increased 34% to $9.4 million, compared to $7.0 million in 2021
  • Increased the number of active accounts by 82% to 1040, compared to 572 at the end of 2021
  • The Company originated $15.8 million in loans, compared to $4.3 million in 2021
  • Ended 2022 with $8.4 million in cash

“Safe Harbor had a pivotal year: we completed our go-public transaction to list on the Nasdaq exchange, executed on the strategic acquisition of Abaca, and significantly grew our client base to establish a solid foundation for success in 2023 and beyond,” said Sundie Seefried, Chief Executive Officer at Safe Harbor. “During the year, we expanded topline revenue by 34% and increased our client base by approximately 82%, demonstrating the considerable industry need for the services we provide. We are committed to providing essential banking services to cannabis-related businesses, or CRBs, using the most sophisticated fintech to optimize our customers’ experience. Our recent acquisition of Abaca is perfectly aligned with this goal as it meaningfully enhanced and added key elements to our fintech platform to expedite transactions with our banking partners.

“This momentum has continued in 2023, and we are pleased to have reached an agreement with Partner Colorado Credit Union to resolve our payment obligations to them, which removes a considerable financial constraint and further enhances our ability to execute on our growth strategy. The cannabis industry is maturing, and the fully complaint cannabis banking infrastructure we provide is vital to CRBs as they navigate this complex and dynamic industry. We are excited about the opportunities ahead and look forward to continuing to expand our services to meet the needs of CRBs across the country, while enhancing value for our shareholders.”

2022 Operational Highlights

  • On September 29, 2022, Safe Harbor completed its business combination transaction with Northern Lights Acquisition Corp. (the “Business Combination”) and began trading on the Nasdaq Capital Markets.
  • On November 16, 2022, the Company acquired Abaca, an industry-leading cannabis fintech platform, for $30 million in cash and common stock. The acquisition increased Safe Harbor’s lending capacity; and added a sophisticated fintech platform and more than 300 cannabis-related business accounts.

Subsequent Operational Highlights

  • On February 8, 2023, Safe Harbor announced that Karl A. Racine commenced active participation on the Company’s Board of Directors following his January 2023 departure from the Washington, D.C. Attorney General’s office.
  • On March 30, 2023, the Company entered into agreements with Partner Colorado Credit Union (“PCCU”), the Company’s largest stockholder, resulting in the settlement of the approximately $64.7 million deferred payable owed to PCCU (the “Agreement”). Under the terms of the Agreement, the Company has agreed to resolve approximately $64.7 million of total payment obligations owed from the September 28, 2022 business combination in exchange for a 5-year, $14.5 million senior secured note bearing a 4.25% annual interest rate and issuance of 11.2 million shares of Class A common stock in the Company.

Originations and Loan Activity

  • For the twelve-month period ended December 31, 2022, Safe Harbor originated loans totaling $15.8 million, compared to $4.3 million for the 2021 full year.

Fourth Quarter 2022 Financial Results

For the quarter ended December 31, 2022, total revenue increased to $3.6 million, compared to $1.7 million in the prior year period, primarily due to higher investment and loan interest income.

Fourth quarter 2022 operating expense increased to $7.4 million, compared to $1.0 million in the prior year period, primarily driven by significantly higher compensation and employee expenses, professional service expenses, and amortization expense.

Net loss for the quarter ended December 31, 2022 was $37.0 million, compared to net income of $718,000 million in the prior year period, primarily due to the loss in value of several of the financial instruments placed in connection with the Business Combination.

Full Year 2022 Financial Results1

For the year ended December 31, 2022, total revenue increased 34% to $9.4 million, compared to $7.0 million in 2021. The increase is due to higher investment and loan interest income, partially offset by lower Safe Harbor program and miscellaneous fee income.

For the full year ended December 31, 2022, total operating expense increased to $11.6 million compared to $3.7 million in 2021, due to the same drivers of expense in the fourth quarter of 2022.

Net loss for the year ended December 31, 2022 was $35.1 million, compared to net income of $3.2 million in 2021, primarily due to the loss in value of several of the financial instruments placed in connection with the Business Combination.

As at December 31, 2022, the Company had cash and cash equivalents of $8.4 million, compared to $5.5 million at December 31, 2021.

1 See “Financial Disclosure Advisory” below.

Conference Call Details:
The Company’s Chief Executive Officer, Sundie Seefried and Chief Financial Officer, Jim Dennedy will host a conference call and webcast at 4:30 pm ET / 1:30 pm PT today to discuss the Company's financial results and provide investors with key business highlights.

Date:Thursday, March 30, 2023
Time:4:30 pm ET / 1:30 pm PT
Live webcast and replay:Click to access
Participant call link:Click to access

About Safe Harbor
Safe Harbor is among the first service providers to offer compliance, monitoring and validation services to financial institutions, providing traditional banking services to cannabis, hemp, CBD, and ancillary operators, making communities safer, driving growth in local economies, and fostering long-term partnerships. Currently managing more than 1000 cannabis-related relationships, Safe Harbor, through its financial institution clients, implements high standards of accountability, transparency, monitoring, reporting and risk mitigation measures while meeting Bank Secrecy Act obligations in line with FinCEN guidance on cannabis-related businesses. Over the past seven years, Safe Harbor has facilitated more than $17 billion in deposit transactions for customers with operations spanning more than 40 states and US territories with regulated cannabis markets. For more information, visit

Financial Disclosure Advisory
The Company has not yet completed its reporting process for the fourth quarter and year ended December 31, 2022. The preliminary results presented herein are based on the Company's reasonable estimates and the information available to the Company at this time. As such, the Company's actual results may materially vary from the preliminary results presented herein and will not be finalized until the Company reports its final results for the fourth quarter and year ended December 31, 2022 after the completion of its normal quarter and year end accounting and review procedures, including the assessment of the financial instruments related to the Company’s business combination with Northern Lights Acquisition Corp. that was completed on September 29, 2022 and intellectual property valuation related to the Company’s acquisition of Abaca that was completed on November 16, 2022, both of which are expected to impact Safe Harbor’s balance sheet and GAAP net income as at and for the year ended December 31, 2022, respectively. In addition, any statements regarding the Company's estimated financial performance for the fourth quarter and year ended December 31, 2022 does not present all information necessary for an understanding of the Company's financial condition and results of operations as of and for these reporting periods. The preliminary financial results presented herein were not reviewed by Safe Harbor’s independent registered public accounting firm.

Forward-Looking Statements
Certain statements contained in this press release constitute "forward-looking statements'' within the meaning of federal securities laws. Forward-looking statements may include, but are not limited to, statements with respect to trends in the cannabis industry, including proposed changes in U.S and state laws, rules, regulations and guidance relating to Safe Harbor's services; Safe Harbor's growth prospects and Safe Harbor's market size; Safe Harbor's projected financial and operational performance, including relative to its competitors; new product and service offerings Safe Harbor may introduce in the future; the impact of recent volatility in the capital markets, which may adversely affect the price of the Company's securities; the outcome of any legal proceedings that may be instituted against Safe Harbor; other statements regarding Safe Harbor's expectations, hopes, beliefs, intentions or strategies regarding the future; and the other risk factors discussed in Safe Harbor's filings from time to time with the Securities and Exchange Commission. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "outlook," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would," and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject, are subject to risks and uncertainties. These forward-looking statements involve a number of risks and uncertainties (some of which are beyond the control of Safe Harbor), and other assumptions, that may cause the actual results or performance to be materially different from those expressed or implied by these forward-looking statements.

Media Contact
Safe Harbor Financial
Nick Callaio, Marketing Manager

Investor Relations Contact
Mattio Communications

SHF Holdings, Inc.

 December 31, December 31,
 2022 2021
Current Assets:      
Cash and cash equivalents$8,390,195  $5,495,905 
Accounts receivable – trade 1,401,839   522,896 
Contract assets 21,170   18,317 
Prepaid expenses – current portion 175,585   6,021 
Accrued interest receivable 40,266   7,556 
Short-term loans receivable, net 51,300   52,833 
Other Current Assets 150,817   - 
Total Current Assets 10,231,172   6,103,528 
Long-term loans receivable, net 1,250,691   1,410,727 
Property, plant and equipment, net 49,614   6,351 
Operating lease right to use assets 1,016,198   - 
Goodwill 19,266,276   - 
Intangible assets, net 10,621,087   - 
Deferred tax asset 51,593,302   - 
Prepaid expenses – long term position 712,500   - 
Forward purchase receivable 4,584,221   - 
Security deposit 17,795   - 
Total Assets$99,342,856  $7,520,606 
Current Liabilities:      
Accounts payable$2,851,457  $43,626 
Accrued expenses 6,354,485   129,546 
Contract liabilities 996   8,333 
Lease liabilities – current 20,124   - 
Deferred Consideration – current portion 14,359,822   - 
Due to seller - current portion 25,973,017   - 
Other current liabilities 11,291   - 
Total Current Liabilities 49,571,192   181,505 
Warrant liability 666,510   - 
Deferred Consideration – long term portion 2,747,592   - 
Forward purchase derivative liability 7,309,580   - 
Due to seller – long-term portion 30,976,783   - 
Lease liabilities – long term 1,008,109   - 
Deferred underwriter fee payable 1,450,500   - 
Indemnity liability 499,465   - 
Total Liabilities  94,229,731   181,505 
Commitment and Contingencies      
Parent-Entity Net Investment and Stockholders’ Equity      
Convertible preferred stock, $.0001 par value, 1,250,000 shares authorized, 14,616 shares issued and outstanding on December 31, 2022, and no shares issued and outstanding on December 31, 2021, respectively 1   - 
Class A common stock, $.0001 par value, 130,000,000 shares authorized, 23,732,889 issued and outstanding on December 31, 2022, and no shares issued and outstanding on December 31, 2021, respectively 2,374   - 
Additional paid in capital 44,806,031   - 
Retained earnings (39,695,281)  - 
Parent-Entity Net Investment -   7,339,101 
Total Parent-Entity Net Investment and Stockholders’ Equity 5,113,125   7,339,101 
Total Liabilities and Parent-Entity Net Investment and Stockholders’ Equity$99,342,856  $7,520,606 

SHF Holdings, Inc.

  For the year ended December 31,
  2022  2021
Revenue$9,478,819  $7,005,579 
Operating Expenses      
Compensation and employee benefits$6,695,319  $2,135,243 
General and administrative expenses 2,390,539   567,892 
Professional services 1,985,343   292,143 
Rent expense 99,246   73,482 
Provision for loan losses 506,212   1,399 
Corporate allocations -   648,533 
Total operating expenses$11,676,659  $3,718,692 
Operating (loss)/ Income (2,197,840)  3,286,887 
Other (income) expenses      
Interest expense 802,797   - 
Change in fair value of warrant liability (939,019)  - 
Change in fair value of forward purchase agreement 33,322,248   - 
Change in fair value of forward purchase option derivative 8,997,110   - 
Total other (income) expenses$42,183,136  $- 
Net (loss) / income before income tax (44,380,976)  3,286,887 
Provision for income taxes$(9,252,893) $- 
Net (loss)/income (35,128,083)  3,286,887 
Weighted average shares outstanding, basic 18,988,558   - 
Basic net loss per share$(1.85) $- 
Weighted average shares outstanding, diluted 18,988,558   - 
Diluted net loss per share$(1.85) $- 



  Preferred Stock Class A Common Stock     
  Shares  Amount Shares  Amount  Additional Paid-in Capital  Parent-Entity Net Investment  Retained Earnings  Total Shareholders' Equity
Balance, December 31, 2020 -  $-  - $- $- $4,354,021  $ -   $4,354,021 
Net income -   -  -  -  -  3,286,887   -   3,286,887 
Contribution of loan receivable from Parent -   -  -  -  -  1,185,691   -   1,185,691 
Net change due to allocations and distributions to Parent -   -  -  -  -  (1,487,498)  -   (1,487,498)
Balance, December 31, 2021 -  $-  - $- $- $7,339,101  $-  $7,339,101 
Issuance of shares in connection with Business Combination and PIPE offering, net of issuance costs 20,450   2  18,715,912  1,872  29,327,087  (7,339,101)  -   21,989,860 
Acquisition of Abaca -   -  2,099,977  210  8,105,701  -   -   8,105,911 
Conversion of PIPE Shares (5,834)  (1) 2,917,000  292  2,916,709  -   (2,917,000)  - 
Stock option conversion -   -  -  -  2,806,336  -   -   2,806,336 
Net loss -   -  -  -  1,650,198  -   (36,778,281)  (35,128,083)
Balance, December 31, 2022 14,616   $1   23,732,889  $2,374  $44,806,031 $-   $(39,695,281) $5,113,125 

SHF Holdings, Inc. 

 Year ended December 31,
 2022 2021
Net (loss) / income$(35,128,083) $3,286,887 
Adjustments to reconcile net income to net cash provided by operating activities:     
Depreciation expense 202,302   1,921 
Stock compensation expense 2,806,336   - 
Interest expense 802,797   - 
Provision for loan loss 506,212   1,399 
Deferred tax credit (9,252,893)   
Change in fair value of warrant and forward purchase option derivative liabilities 41,380,339   - 
Changes in operating assets and liabilities:     
Accounts receivable (653,425)  (293,355)
Contract assets (2,853)  - 
Prepaid expenses 55,997   (3,468)
Forward purchase receivables 1,379,285   - 
Accrued interest receivable (32,711)  (7,556)
Deferred underwriting payable (715,750)  - 
Other current assets (150,817)  - 
Accounts payable 508,544   (64,900)
Accrued expenses 17,550   37,742 
Contract Liabilities (7,337)  - 
Security deposit (18,113)  - 
Deferred revenue -   (12,287)
Net cash provided by operating activities 1,697,380   2,946,383 
Purchase of property and equipment (17,318)  (5,920)
Change in loan receivable, net 161,569   1,041,577 
Acquisition of Abaca (3,041,680)  - 
Net cash provided by (used in) investing activities (2,897,429)  1,035,657 
Proceeds from reverse capitalization, net of transaction costs 4,094,339   - 
Net change in parent funding, allocations, and distributions to parent -   (1,487,498)
Net cash provided by (used in) financing activities 4,090,945   (1,487,498)
Net increase in cash and cash equivalents 2,894,290   2,494,542 
Cash and cash equivalents - beginning of period 5,495,905   3,001,363 
Cash and cash equivalents - end of period$8,390,195  $5,495,905 
Non-Cash transactions:     
Shares issued for the settlement of abaca acquisition$8,105,911  $- 
Operating lease right of use assets recognized 1,029,227   - 
Operating lease liabilities recognized 1,022,380   - 
Contribution of loan receivable from Parent -   1,185,691 

SHF Holdings, Inc.

UNAUDITED Reconciliation of net income to non-GAAP EBITDA and Adjusted EBITDA is as follows:

 Year Ended December 31,
  2022   2021 
Net (loss)/ income$(35,128,083) $3,286,887 
Interest expense 802,797   - 
Depreciation 189,275   1,921 
Taxes (9,252,893)  - 
EBITDA (43,388,904)  3,288,808 
Other adjustments –   
Loan loss provision 506,212   1,399 
Change in warrants and forward purchase derivatives 41,380,339   - 
Deferred loan origination fees and costs (1,890)  - 
Stock option conversion 2,806,336   - 
Adjusted EBITDA 1,302,093   3,290,207 

Safe Harbor Financial discloses EBITDA and Adjusted EBITDA, both of which are non-GAAP financial measures and are calculated as net income before taxes and depreciation and amortization expense in the case of EBITDA and further adjusted to exclude non-cash, unusual and/or infrequent costs in the case of Adjusted EBITDA. Management of the Company uses this information in evaluating period over period performance because it believes it presents an important metric regarding the Company’s ongoing operating performance.


  A  B A+B
  December 31,
  Adjustment December 31,
Current Assets:          
Cash and cash equivalents$8,390,195  $-  8,390,195 
Accounts receivable – trade 1,401,839   -  1,401,839 
Contract assets 21,170   -  21,170 
Prepaid expenses – current portion 175,585   -  175,585 
Accrued interest receivable 40,266   -  40,266 
Short-term loans receivable, net 51,300   -  51,300 
Other Current Assets 150,817   -  150,817 
Total Current Assets 10,231,172     10,231,172 
Long-term loans receivable, net 1,250,691   -  1,250,691 
Property, plant and equipment, net 49,614   -  49,614 
Operating lease right to use assets 1,016,198   -  1,016,198 
Goodwill 19,266,276   -  19,266,276 
Intangible assets, net 10,621,087   -  10,621,087 
Deferred tax asset 51,593,302   -  51,593,302 
Prepaid expenses – long term position 712,500   -  712,500 
Forward purchase receivable 4,584,221   -  4,584,221 
Security deposit 17,795   -  17,795 
Total Assets$99,342,856  $-  99,342,856 
Current Liabilities:       
Accounts payable$2,851,457  $-  2,851,457 
Accrued expenses 6,354,485   (4,911,074) 1,443,411 
Contract liabilities 996     996 
Lease liabilities – current 20,124   -  20,124 
Deferred Consideration – current portion 14,359,822   -  14,359,822 
Due to seller - current portion 25,973,017   (25,484,183) 488,834 
Other current liabilities 11,291   -  11,291 
Total Current Liabilities 49,571,192   (30,395,257) 19,175,935 
Warrant liability 666,510   -  666,510 
Deferred Consideration – long term portion 2,747,592   -  2,747,592 
Forward purchase derivative liability 7,309,580   -  7,309,580 
Due to seller – long-term portion 30,976,783   (16,965,617) 14,011,166 
Lease liabilities – long term 1,008,109   -  1,008,109 
Deferred underwriter fee payable 1,450,500   (900,500) 550,000 
Indemnity liability 499,465   -  499,465 
Total Liabilities  94,229,731   (48,261,374) 45,968,357 
Commitment and Contingencies       
Parent-Entity Net Investment and Stockholders’ Equity       
Convertible preferred stock, $.0001 par value, 1,250,000 shares authorized, 14,616 shares issued and outstanding on December 31, 2022, and no shares issued and outstanding on December 31, 2021, respectively 1   -  1 
Class A common stock, $.0001 par value, 130,000,000 shares authorized, 23,732,889 issued and outstanding on December 31, 2022, and no shares issued and outstanding on December 31, 2021, respectively 2,374   1,120  3,494 
Additional paid in capital 44,806,031   47,561,927  92,367,958 
Retained earnings (39,695,281)  698,327  (38,996,954)
Parent-Entity Net Investment -   -  - 
Total Parent-Entity Net Investment and Stockholders’ Equity 5,113,125   48,261,374  53,374,499 
Total Liabilities and Parent-Entity Net Investment and Stockholders’ Equity$99,342,856  $-  99,342,856 

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