Fort Lauderdale, Florida--(Newsfile Corp. - September 18, 2023) - Flora Growth Corp. (NASDAQ: FLGC) ("Flora" or the "Company"), a global consumer-packaged goods leader and pharmaceutical distributor serving all 50 states and 28 countries with 20,000+ points of distribution, has entered into a definitive agreement (the "Agreement") to acquire Australian Vaporizers Pty Limited ("Australian Vaporizers") to acquire all of the issued and outstanding shares of Australian Vaporizers in exchange for 600,676 Flora common shares, valued at $1.7 million based on the closing price of Flora's common shares on September 15, 2023, subject to working capital adjustments. The transaction is expected to close in the fourth quarter of 2023.

Australian Vaporizers is expected to be immediately accretive to Flora and is anticipated to provide annual contributions of $5.2 million in revenues, $1.2 million in gross margins and $0.5 million in net income. For its most recently completed six-month period ended May 31, 2023, Australian Vaporizers achieved $2.5 million in revenues, $0.6 million gross margins and $0.25 million in net income. At closing, Australian Vaporizers is expected to have cash hand of at least $0.3 million, inventories of $0.8 million and working capital of $1.1 million.

Australian Vaporizers was founded in 2010 and has become one of the largest online retailers of vaporizers, hardware, and accessories in Australia. Its website www.australianvaporizers.com.au is a popular designation in the country with a large database of satisfied customers. Australian Vaporizers sold over 92,000 units to over 30,000 active customers through business to business and direct to consumer channels.

"In addition to quickly improving the Company's bottom line, Australian Vaporizers has the potential to drive synergies with Flora's existing portfolio of brands, including selling Vessel Brand products in Australia which is Flora's fastest growing segment," commented Clifford Starke, Chief Executive Officer.

Vessel is Flora's vaporizers brand operating through direct-to-consumer and retail sales. Vessel's products include cannabis consumption accessories, personal storage, and travel accessories for the vape and dry herb categories, which are sold to consumers, dispensaries, smoke shops and cannabis brands.

"I am intimately familiar with Australian Vaporizers' solid track record from my tenure as a board member of Namaste Technologies. The Australian market has demonstrated impressive growth and the acquisition of Australian Vaporizers would allow Flora to be at its forefront," concluded Mr. Starke.