Greenway Greenhouse Cannabis Corporation’s nearly $1.4 million in revenue in the last three months of 2023 still saw the Ontario cannabis producer in the red $1.6 million, according to their most recent quarterly report.
This is an improvement from the previous quarter when the company reported a net loss of $576,461. For the first three quarters of 2023, the company reported a comprehensive loss of nearly $3.4 million compared to just over $1 million for the same period in 2022.
Gross profits for the last three months of 2023 were also down compared to the same period in 2022, from $234,849 to $1.9 million.
The losses are attributed to increased production costs like labour and utilities, as well as a lower price per gram of cannabis. The cost of goods sold in the third quarter of 2023 was nearly $1.2 million compared to $508 thousand in the previous quarter.
The company says it has insufficient cash to pay creditors for current working capital obligations and operations for the next twelve months, referencing “significant doubt about the Company’s ability to continue.”
In addition, its quarterly report cautions that the company’s “ability to continue as a going concern is dependent upon its ability to obtain sufficient additional funding and to generate sufficient revenues and positive cash flows from its operating activities to meet its obligations and fund its planned investments and operations.”
The concerns are not new and have been mentioned in previous quarterly reports.
Greenway is sitting on more than $2 million in dried cannabis, compared to about $1.5 million in Q1 2023.
It operates a cannabis nursery facility in Kingsville, Ontario, and a flowering and processing facility in Leamington, Ontario.
It reports an average cash cost per gram of $0.75 for finished goods inventory on hand as of December 31, 2023. The company’s biological assets were comprised of 11,026 plants (March 31, 2023 – 6,519), which were, on average, 59% (March 31, 2023 – 43%) complete, and it was expected that they would yield approximately 1,364 kg (March 31, 2023 – 1,193 kg) of dry flower.
Biological assets refer to the value assigned to pre-harvest cannabis plants still in the process of growing, relating to expected yield.
