Sundial Growers Inc. Condensed Interim Consolidated Financial Statements For the three and six months ended

Consolidated Financial Statements

the three and six months ended June 30, 2019 and 2018

- expressed in thousands of Canadian dollars)

Sundial Growers Inc.

Consolidated Statements of Financial Position

- expressed in thousands of Canadian dollars)

Commitments (note 21)

Subsequent events (note 11, 22)

See accompanying notes to the condensed

interim consolidated financial statements.

Consolidated Statements of Loss and Comprehensive Loss

- expressed in thousands of Canadian dollars, except per share amounts)

See accompanying notes to the condensed

interim consolidated financial statements.

Consolidated Statements of Changes in Equity (Deficit)

- expressed in thousands of Canadian dollars)

Consolidated Statements of Changes in Equity (Deficit)

- expressed in thousands of Canadian dollars)

See accompanying notes to the condensed

interim consolidated financial statements.

Consolidated Statements of Cash Flows

- expressed in thousands of Canadian dollars)

See accompanying notes to the condensed

interim consolidated financial statements.

Interim Consolidated Financial Statements

the three and six months ended June 30, 2019 and 2018

- expressed in thousands of Canadian dollars, except where otherwise noted)

Growers Inc. ("Sundial" or the "Company") was incorporated under the Business Corporations Act Alberta

Company's head office is located at 200, 919 11th Avenue SW, Calgary Alberta Canada.

principal activities of the Company are the production, distribution and sale of cannabis as regulated by the Access to Cannabis

for Medical Purposes Regulations ("ACMPR") in Canada, up to and including October 16, 2018. On October 17, 2018, the

ACMPR was superseded by The Cannabis Act which regulates the production, distribution, and possession of cannabis for both medical

and adult recreational access in Canada. The Company is planning to expand its operations to jurisdictions outside of Canada where

federally lawful and regulated, including subsidiaries which operate in Europe and the United Kingdom.

August 1, 2019, the Company's common shares began trading on the Nasdaq Global Select Market ("Nasdaq") under

the ticker symbol "SNDL".

does not engage in any U.S. cannabis-related activities as defined in Canadian Securities Administrators Staff Notice 51-352.

condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34

- Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB") and interpretations

of the International Financial Reporting Interpretations Committee ("IFRIC") in effect as of December 31, 2018, except

as noted in note 3(a). These condensed interim consolidated financial statements follow the same accounting policies and methods

of application as those disclosed in the annual audited consolidated financial statements for the ten months ended December 31,

2018 and should be read in conjunction with the annual consolidated financial statements for the Company for the ten months ended

December 31, 2018 which have been prepared in accordance with International Financial Reporting Standards ("IFRS")

as issued by the IASB.

consolidated financial statements have been prepared on a going concern basis, based on Management's assessment that the

Company will be able to realize its assets and discharge its liabilities in the normal course of business. These consolidated

financial statements do not give effect to adjustments that would be necessary to the carrying values and classifications of assets

and liabilities should the Company be unable to continue as a going concern.

These condensed interim consolidated

financial statements were approved and authorized for issue by the Board of Directors ("Board") on August 13, 2019.

condensed interim consolidated financial statements have been prepared on a historical cost basis, except for biological assets

and financial instruments which are measured at fair value with changes in fair value recorded in earnings.

consolidated financial statements are presented in Canadian dollars, which is the functional and presentation currency of the

Company and its subsidiaries with the exception of Sundial Deutschland GmbH and Sundial Portugal, Unipessoal LDA which use the

European Euro as their functional currency and Sundial UK Limited which uses the Great Britain Pound as its functional currency.

Transactions in currencies other than the functional currency are translated at the rate prevailing at the date of transaction.

Monetary assets and liabilities that are denominated in foreign currencies are translated at the rate prevailing at each reporting

date. Income and expense amounts are translated at the dates of the transactions.

Interim Consolidated Financial Statements

the three and six months ended June 30, 2019 and 2018

- expressed in thousands of Canadian dollars, except where otherwise noted)

are entities controlled by the Company. Control exists when the Company has the power, directly and indirectly, to govern the

financial and operating policies of an entity and be exposed to the variable returns from its activities. The financial statements

of subsidiaries are included in these consolidated financial statements from the date that control commences until the date that

accounting policies, critical accounting judgements and significant estimates used in the preparation of the Company's audited

consolidated financial statements for the ten months ended December 31, 2018 have been applied in the preparation of these financial

statements except as described below.

1, 2019, the Company adopted IFRS 16, "Leases" using the modified retrospective approach which replaces IAS

17 Leases, which came into effect for annual periods beginning on or after January 1, 2019. The modified retrospective approach

does not require restatement of comparative financial information as it recognizes the cumulative effect on transition as an adjustment

to opening retained earnings and applies the standard prospectively. Comparative information in the Company's consolidated statements

of financial position, consolidated statements of loss and comprehensive loss, consolidated statements of changes in equity, and

consolidated statements of cash flows has not been restated.

the new standard, a contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset

for a period of time in exchange for consideration. The Company recognizes a right-of-use asset and a lease obligation at the

lease commencement date. The right-of-use asset is initially measured at cost, and subsequently at cost less any accumulated depreciation

and impairment losses and adjusted for certain remeasurements of the lease obligation. Depreciation is recognized on the lease

asset over the shorter of the estimated useful life of the asset or the lease term. The lease obligation is initially measured

at the present value of the lease payments that have not been paid at the commencement date, discounted at the rate implicit in

the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate. The lease obligation

is subsequently increased by the interest cost on the lease obligation and decreased by lease payments made. Lease payments are

allocated between the liability and interest expense. Interest expense is recognized on the lease obligations using the effective

interest rate method and payments are applied against the lease obligation.

amounts of the right-of-use assets, lease obligations, and the resulting interest and depreciation expense are based on the implicit

interest rate within the lease arrangement or, if this information is unavailable, the incremental borrowing rate. Incremental

borrowing rates are based on judgments including economic environment, term, and the underlying risk inherent to the asset.

Interim Consolidated Financial Statements

the three and six months ended June 30, 2019 and 2018

- expressed in thousands of Canadian dollars, except where otherwise noted)

assets were initially recognized at an amount equal to the discounted lease payments using an incremental borrowing rate of 5.95%.

of IFRS 16 using the modified retrospective approach allowed the Company to use the following practical expedients in determining

the opening transition adjustment: