Tag: Financials

CanadaBis continues trend of profitability with focus on pre-rolls and extracts

Written by Sarah Clark on June 26, 2024. Posted in Financials.

CanadaBis Capital Inc, the parent company of cannabis brands like Stigma Grow, reported its third quarter fiscal 2024 results, with $2.2 million in gross profits and 109,824 in net and comprehensive income.

The majority of the Calgary-based cannabis company’s profits was from the sale of extracts, with $170,946 in gross profits from dried flower sales and just under $2 million in extract sales for the three months ended April 30, 2024. This is an increase in gross profits from cannabis flower sales from the same quarter in 2023 ($59,579) and a decrease in gross profits from extracts sales ($2.6 million).

The Company reported a 44% decrease in its sales of extract products in the provinces of Alberta, Ontario, Saskatchewan, and British Columbia. However, it has seen continued growth in the sale of its flavoured, infused pre-rolls and its Electric Dartz pre-rolls. CanadaBis also lists its butane hydrocarbon (BHO) extraction process as a competitive advantage in the industry.

The company lists $763,447 in excise duty from its sales of flower (~48% of $1.6 million gross sales) and almost $2.4 million in excise duty for extracts sales (from $5.5 million gross sales), both representing around 40-50% excise rates, for Q3 2024.

The Company currently owns a 66,000-square-foot facility in Alberta, with around 44,000 square feet of the building developed and equipped to grow 225 kg of cannabis per year. In the most recent quarter, they released 17 new SKUs into the Canadian market and have been attempting to position themselves as the leader in infused pre-rolls and “super slim” pre-rolls, as well as expand the Dab Bods brand across Canada.

The company’s overall gross revenues were up in Q3 2024 compared to Q2 2024, but higher excise taxes meant lower net revenue. This was somewhat offset by a lower cost of sales, which led to net income remaining relatively stable from Q2 to Q3.

“CanadaBis Capital’s performance in Q3 2024 was robust, driven by our strategic investments and continuous efforts to optimize our operational efficiencies,” said Travis Mcintyre, Chief Executive Officer of CanadaBis Capital. “We are focused on enhancing shareholder value through prudent financial management and forward-thinking strategies in the evolving cannabis market.”

Nova Scotia sold $121 million worth of cannabis in 2023

Written by David Brown on June 26, 2024. Posted in Cannabis News, Financials, Government.

The Nova Scotia Liquor Corporation (NSLC) released their most recent year-end financial report on June 25 covering April 1, 2023-March 31, 2024.

The Crown corporation, which operates 49 retail cannabis locations, sold $121 million worth of cannabis, an 8.9% increase from the previous year. Sales of local Nova Scotia cannabis products accounted for $39.5 million, or 32.7% of all cannabis sales, a 17.9% increase from the previous year.

Cannabis transactions increased by 12.2%, but the average basket size decreased by 3% to $37.27, along with a 4% reduction in the average price per gram of $5.96.

“We continue to see strong growth in cannabis sales demonstrating our continued progress in competing with the illicit cannabis market,” said Greg Hughes, NSLC president and CEO. “In addition to the expansion of our cannabis retail network, our strong vendor partnerships, including our valued local cannabis producers, have played an important role.”

NSLC also reports that 79% of Nova Scotians now live within 10 kilometres of a licensed cannabis store.

The agency, which also manages the sale of alcohol in the province, reported total annual sales of $874.5 million, with alcohol sales accounting for $753.4 million. Total earnings were $283.8 million.

Nova Scotia forecast $17.4 million in their share of federal cannabis excise for 2023-24, and $18.3 million for 2024-25. In 2022-2023 they reported $14.8 million in cannabis tax.

Atlas Global Brands granted CCAA protection

Written by David Brown on June 21, 2024. Posted in Business, Cannabis News, Financials, Producers.

Atlas Global Brands, the company behind cannabis brands like D*gg Lbs, GreenSeal, and Electric Lettuce along with its subsidiaries, has been granted an initial order under the Companies’ Creditors Arrangement Act (CCAA).

Atlas Global includes GreenSeal Cannabis Company Ltd., GreenSeal Nursery Ltd., AgMedica BioScience Inc., Wellworth Health Corp., 5047346 Ontario Inc., 8050678 Canada Inc., and Tavivat Naturals Inc. as its subsidiaries. The company says the CCAA order will provide an opportunity to restructure its business and financial affairs.

Atlas Biotechnologies Inc. and Atlas Growers Ltd had previously gone into receivership in 2023.

Headquartered in Chatham, Ontario, Atlas Global operates its business of cultivation, extraction, manufacturing, marketing, and distribution through its wholly-owned Canadian subsidiaries, GreenSeal and AgMedica. Atlas Global operates two licensed cannabis facilities in Canada, one of which has European Union GMP certification, as well as three medical pharmacies in Israel. Atlas Global distributes its products within Canada and to seven other countries: Australia, Denmark, Germany, Israel, Norway, Spain and the United Kingdom.

At the end of 2023, Atlas Global employed 185 full-time employees in Canada and two full-time employees in Israel. In early 2023, Atlas announced it was moving its operations from Alberta to Ontario and laying off 50 workers in the process. In August 2023, the company listed a notice of sale for many of its assets. In January 2024, the Agriculture Financial Services Corporation filed a bankruptcy order against Atlas Growers.

A bankruptcy creditor package filed in February of this year lists $3.5 million in total realized assets. It lists the Agriculture Financial Service Corporation as a secured creditor with the company for a total of $8.6 million.

The Atlas Group is scheduled to return to Court for a comeback hearing on June 27, 2024, at which time it plans to seek, among other relief, an Amended and Restated Initial Order, an extension of the stay of proceedings, and interim financing to allow the Atlas Group to stabilize its operations, consider possible transactions, and emerge from the CCAA Proceedings as a going concern.

One of the Company’s creditors, Stoke Canada Finance Corp., has applied to have a receiver appointed over the Company’s receivables and related assets. Unless resolved, that application will be heard at the Comeback Hearing.

The Company says it continues to believe that the protection afforded by the CCAA will allow it to stabilize operations in order to consider potential restructuring transactions that would benefit all stakeholders, including the sale of all or substantially all of the business or assets of the Atlas Group through a court-supervised sales process.

Aurora quarterly report shows increase in net revenue, decrease in losses

Written by Sarah Clark on June 20, 2024. Posted in Financials.

Aurora Cannabis reported $67.4 million in net revenue for the three months ending March 31, 2024, but a $20.8 million net loss.

The net revenue represented a 5% year-over-year increase, while the net loss represents a $66 million increase in net revenue from the $86.8 million loss for the same three months in 2023.

Aurora’s loss from operations ($2.7 million) also declined significantly in the three months ending March 31, 2024, compared to the previous three months ending December 31, 2023, with a loss from operations of $18 million and $31.1 million in the three months ending March 31, 2023.

Of Aurora’s $67.4 million in net revenue, $45.6 million was from sales of cannabis for medical purposes, while $10.2 was from sales of cannabis for non-medical (“consumer”) purposes. Another $10.4 million in net revenue was from plant propagation (from its non-cannabis “Bevo” operation).

Net revenue from medical sales was up 20% from the three months ending March 31, 2023, while net revenue from “consumer” cannabis was down 29% compared to the three months ending March 31, 2023. Plant propagation revenue was down 3% from the first three months 2023.

Aurora’s average net selling price of dried cannabis, excluding bulk sales, was $5.37, with 15,179 kg sold in the first three months of 2024. The average selling price increased from $4.74 in the first three months of 2023 when the company sold 16,578 kg of cannabis.

Of the $45.6 million in medical cannabis sales, $26.5 million was from sales in Canada, while $19.2 million was in international sales. Aurora also reported $1.1 million in net revenue for wholesale bulk cannabis. While Canadian medical cannabis sales declined slightly (by $652,000) compared to the first three months of 2023, international sales increased slightly (by $86,000).

Aurora attributes the increase in international sales partly to the current year, consisting of four quarters compared to three quarters in the prior year, as well as “significantly” higher sales to Australia and “improved” sales to Poland and the United Kingdom. Aurora’s main medical markets are Canada, Germany, the UK, Poland, and Australia.

On February 7, 2024, Aurora Cannabis acquired Indica Industries Pty Ltd. (Australia), giving them full control of the Indica operations for a purchase price of $44.7 million.

In March, Aurora became one of the first Canadian cannabis companies to receive European Union Good Manufacturing Practice (“EU GMP”) certification from Australia’s Therapeutic Goods Administration (TGA) for its Canadian production facilities, River and Ridge.

“We are incredibly pleased to be reporting our strongest fiscal year ever at Aurora,” said CEO Miguel Martin. “Total fiscal year 2024 net revenue increased 21% compared to the trailing four quarters, while adjusted EBITDA was positive on an annualized basis for the first time in our history, reaching $12.8 million. We also strengthened our balance sheet, ending with a strong net cash position of approximately $180 million as of March 31^st, and fully repaid our convertible debt.”

Christina Lake Cannabis files year-end report for 2023

Written by Sarah Clark on June 19, 2024. Posted in Financials.

After some delays, BC’s Christina Lake Cannabis (CLC) recently released its financial statements for the year ending November 30, 2023.

The indoor and outdoor cannabis producer and processor posted a total revenue of $11.8 million in 2023, up from $10 million in 2022 and $3.6 million in 2021. The company posted a net loss of $4.1 million for 2023, compared to a net loss of $2 million in 2022 and $2.1 million in 2021. The company also reported more than $227,548 in regulatory fees for the year ending November 30, 2023.

Revenue was primarily from distillate sales, with CLC attributing a year-over-year decline in gross margin percentage to price compression in the wholesale distillate market.

CLC operates two outdoor production sites in BC, one on a 32-acre property and the other on a 100-acre property. It also processes its own biomass into distilled and winterized oils, kief, and other extracts for sale to other producers.

After the end of this most recent reporting period, the company also secured a third outdoor production site in BC, BZAM’s former Midway site, along with related harvesting and manufacturing equipment and approximately 19,000 kg. of biomass.

The Midway property is 342 acres, with just over 100 acres of licensed cultivation space. With this acquisition, CLC will expand its licensed outdoor cultivation footprint to over 120 acres. Further expansion of additional acreage is available and could be licensed by the company should the demand arise.

The company plans to grow the first 80-acre crop of their proprietary CLC cultivars in 2024 at the new site, with expansion to 100 acres planned for 2025.

In January, Christina Lake Cannabis also repaid its Canada Emergency Business Account loan in full. Because the loan was repaid before the January 18, 2024 deadline, $10,000 of the original $40,000 interest-free loan was forgiven.

High Tide reports increase in retail footprint, revenue

Written by Sarah Clark on June 13, 2024. Posted in Financials.

High Tide Inc. reports a 5% year-over-year increase in revenue and a 175% year-over-year increase in income in its most recent quarterly report.

The company behind Canada’s largest non-franchised retail cannabis chain brought in $124.3 million in revenue in the three months ending April 30, 2024, up from $118.1 million in the same period in 2023, but down slightly from the $128.1 million in revenue from the first three months of 2024.

High Tide’s net income for the second quarter of 2024 was $171,000, an improvement from a $5,000 loss in the previous quarter and a $1.6 million loss in Q2 2023. The Company is free cash flow positive for the fourth consecutive quarter, ending with a free cash flow of $9.4 million.

High Tide attributes its 5% year-over-year growth in revenue largely to the continued increase in cannabis stores under its control, as well as growth in same-store sales. This growth is partially offset by the increase/decrease in data analytics and e-commerce revenues. The company operated 168 cannabis stores in the second quarter of 2024, primarily under its Canna Cabana brand.

Revenue from sales of cannabis products in Q2 2024 was $108 million, another $7.3 million was from consumption accessories, and just under $9 million was from its data analytics service “Cabanalytics,” as well as advertising and “other revenue.”

The Cabanalytics Business Data and Insights Platform is billed as giving subscribers access to High Tide’s monthly report of anonymized consumer purchase data with a stated goal of helping retailers with “forecasting and planning their future product decisions and implementing appropriate marketing initiatives.”

High Tide’s CEO, Raj Grover, says the company still holds its position as the highest revenue-generating cannabis company reporting in Canadian dollars.

“I am thrilled to report that in an environment where many cannabis companies, including some of our retail competitors, have been forced to seek bankruptcy protection, our team has been able to deliver positive net income in Q2, while also generating record-breaking free cash flow. In fact, over the past four quarters, we have generated $22.7 million in free cash flow, fueling our strong organic growth. We accomplished this despite Q2 being a seasonally slower quarter with two fewer days, as we tightly managed our G&A while also rapidly growing our store count and increasing our Canadian retail market share to 10.9%.”

High Tide to acquire Queen of Bud

March 15, 2024

Alberta now allowing private label cannabis products

June 3, 2024

High Tide Inc. reports increased revenue, declining losses, in newest quarterly report

March 15, 2024

Retail chain Four20 files NOI under Bankruptcy and Insolvency Act

Written by Sarah Clark on June 3, 2024. Posted in Business, Cannabis News, Financials, Retail.

The parent companies of cannabis retail chain Four20 Premium Markets filed a notice of intent to make a proposal under the Bankruptcy and Insolvency Act on May 29.

The parent companies, 420 Premium Markets Ltd., 420 Investments Ltd., and Green Rock Cannabis (EC1) Ltd., filed the notices of intent following a $9.8 million judgment against 420 for repayment of a bridge loan and related interest and costs to Tilray subsidiary High Park Shops Inc. High Park was created for the purpose of the acquisition of Four20.

Tilray had initiated litigation against 420 after a failed attempt by Tilray to purchase 420 for approximately $110 million in 2019.

At the time, Four20 had six licensed cannabis retail locations and another 16 locations secured in Alberta. The retailer currently lists 35 locations in Alberta and Ontario.

Four20 then filed a statement of claim against Tilray in 2020 in an Alberta court for $110 million plus $20 million in damages after Tilray chose to end its deal to buy the retailer, with Four20 saying the BC-based cannabis producer had not acted in good faith.

According to court documents, High Park then filed a Counterclaim on March 20, 2020, in relation to a loan advanced in connection with the Arrangement. High Park had advanced $5 million to Four20 under the Loan on August 29, 2019, and a further $2 million on November 29, 2019.

On April 14, 2020, Four20 defended the Counterclaim, arguing that the money advanced to it under the loan agreement was not due because High Park’s and Tilray’s alleged notices of termination of the agreement were invalid.

High Park filed an application for summary judgment in relation to the loan on March 2, 2023. On February 7, 2024, a court granted High Park summary judgment against Four20 on its counterclaim for $7 million plus interest.

The Applications Judge then dismissed Four20s application for an interim stay of the Judgment on March 22, 2024, pending the determination of an appeal on the merits, with Four20 arguing that Tilray had “buyer’s remorse” and felt they had overpaid for the retail chain.

That appeal was dismissed in April 2024, with the judge finding that Four20 had not demonstrated that it would suffer irreparable harm. In that case, the judge wrote, “There is no dispute that Four20 received the Loan proceeds of $7,000,000 and has used those funds to build out its retail store network. Four20 asserts that paying back the funds it borrowed, pending appeal of the Judgment, would be a greater harm than High Park going without the funds that it lent Four20 under the Loan. I disagree.”

AgriCann continues to struggle

Written by Sarah Clark on May 30, 2024. Posted in Financials.

AgriCann Solutions Corp. provided an update to shareholders, noting that its wholly owned subsidiary, Newline Ventures Inc., a micro cultivator and processor located in Vernon, BC, continues as a “bare-bones operation” as existing inventory is being sold off.

AgriCann remains under a “Cease Trade Order” (“CTO”) issued by the BC Securities Commission. The company also operates Craft Nurseries Canada Ltd., a cannabis nursery located in Lake Country, British Columbia.

In April, AgriCann said it would be shutting down new cultivation for a three-month period, “given the buildup of inventory and disruptions at the leadership level,” to allow for “a re-assignment and rationalization of core personnel and to facilitate the processing of harvested flower and related packaging and refocus on developing sales and retail store relations.”

A consultant hired in April at Newline left early without providing recommendations to the board. In February, the company’s CFO resigned, and the accountant brought in at the Newline facility to assume their duties is said to have failed to complete the company’s expected December 31, 2023 Q3 consolidated reporting obligations. The CFO did update Newline’s bookkeeping.

The Company anticipates that it will not have the necessary resources to engage an auditor for its March 31, 2024, fiscal year annual audit, typically a $50,000 engagement demanding upfront payment under the circumstances.

In December 2023, AgriCann’s CEO also stepped down. They had been acting as an RPIC. Founding director and former COO Tim Tombe immediately assumed an interim CEO position.

AgriCann also says that its sales in the Ontario market have entirely shut down since Newline fell behind on excise payments.

In April, the company wrote: “In hindsight, the Company’s long-term growth aspirations as executed over 2023 sacrificed the achievement of steady-state production, revenue and expense coverage. The resulting cash burn became increasingly unfinanceable, given projections regularly missed and goalposts extended. The lengthy Newline acquisition closing delay encountered was a complicating factor. Last-minute cash calls were used to compensate. Simply put, operations required a substantially greater financial commitment than envisioned, which the Company could not effectively raise without key shareholder support. Meanwhile, the cannabis sector was experiencing its own challenges and dislocation, with significant investor distress and aversion.”

For the six months ended September 30, 2023, AgriCann reported a net loss from operations of $837,520 and revenue of $3,118.

Shiny Bud files notice of intention to make a proposal under Bankruptcy and Insolvency Act

Written by Sarah Clark on May 28, 2024. Posted in Cannabis News, Ontario, Retail.

The parent company of Shiny Bud, a cannabis retail chain in Ontario, announced it has filed a Notice of Intention to make a proposal pursuant to the provisions of the Bankruptcy and Insolvency Act.

The parent company, Shiny Health & Wellness Corp., emphasizes that it is not bankrupt. Instead, it says the primary purpose of the Notice of Intention (NOI) filing is to “create a stabilized environment for the Company and its financial advisors to run an orderly and flexible sale, investment and solicitation process (“SISP”) with the goal of identifying one or more interested parties that wish to acquire or make an investment in the Company’s business or all or some of its assets.”

Shiny Bud says it currently operates 20 locations in Ontario. On May 16th, the company announced it had temporarily closed five of its retail cannabis stores effective immediately. It had previously closed another three locations and opened one since October 31, 2023. Its website currently lists 36 locations. The AGCO lists 37 locations as authorized to open.

If the agreement is approved, Shiny Health believes it has enough resources to fund its operations during the SISP, and its stores will remain open for business during that time. This would be subject to any restructuring steps the company may take during this process.

It expects that its 20 licensee stores will not be impacted by the NOI and will be able to continue to use the Shiny Bud brand in accordance with the licence agreements.

Due to the NOI filings and other “financial resource constraints,” Shiny Health says it does not expect to file its annual financial statements and accompanying management’s discussion and analysis for the fiscal year ended January 31, 2024, by the prescribed deadline of May 30, 2024.

In addition to its retail cannabis stores, Shiny Health also owns one pharmacy in Ontario, initially intending to create a chain of pharmacies that would provide access to cannabis, as well. A recent report proposed allowing sales of medical cannabis through pharmacies in Canada.

As of October 31, 2023, Shiny Health had cash of $239,817, liabilities that exceeded current assets by $7.4 million, an accumulated deficit of $26.7 million, and a shareholders’ deficit of $5.1 million.

“The current negative working capital deficit indicates the existence of material uncertainties that may cast significant doubt on the company’s ability to continue as a going concern,” says its most recent report for 2023. “Management’s view is that the success of the Company is dependent upon its ability to generate sufficient positive cash flow from its total operations to cover all its costs, including overhead and public company costs and obtaining financing through a combination of equity and additional debt where possible for working capital, debt service and to sustain its operations until positive overall cash flow is achieved.”

For the three months ended October 31, 2023, Shiny Health had $4.3 million in revenue, with a loss of $752,594 and a net comprehensive loss of $5.9 million.

In the same period, it brought in $3.6 million in revenue from its retail cannabis operations, $220,849 from its “data program,” and $346,828 from its pharmacy. This represented about a 45% decline in revenue for its retail cannabis operations and data program from the same period in 2022.

For the nine months ended October 31, 2023, retail cannabis operations brought in $14.8 million, a 30% decline from the same period in 2022 and $852,450 from its data program, down 33% from the same period in 2022.

The company blames the decrease in cannabis sales and data program revenue on the market conditions in Ontario and the closure of some of its stores.

Simply Solventless reports seventh consecutive quarter of positive EBITDA

Written by Sarah Clark on May 27, 2024. Posted in Financials.

Simply Solventless Concentrates (SSC) brought in $502,536 in net revenue in the first three months of 2024 from gross revenue of $3.1 million and net revenue after taxes of $2.3 million.

The Alberta-based company is behind cannabis brands Astrolab, Frootyhooty and the recently acquired Lamplighter, all available in Alberta, Ontario, and Saskatchewan with infused pre-rolls and vapes. Simply Solventless acquired Lamplighter on January 17, 2024. The company is looking to enter Manitoba and hopes to enter BC soon.

SSC says it has been experiencing rapid revenue growth, with average gross revenue of approximately $233,281 per month in 2022, around $581,117 per month in 2023, and $1,033,334 per month in the first three months (Q1) of 2024.

Excise tax on the $3.1 million in gross revenue for the first three months of 2024 was $823,959. The cost of goods sold in the net revenue of $2.3 million was nearly $1.2 million for a gross profit of $1.1 million. Adjusted EBITDA for Q1 2024 was $611,571. The company has reported positive adjusted EBITDA for the past seven quarters.

This represents an increase in gross and net revenue for the company compared to Q1 2023. However, the company reported lower gross profit and net income than in the same period, as excise taxes were not listed as remitted in Q1 2023.

Net and comprehensive income was $502,536 in Q1 2024, compared to $758,828 in Q1 2023 and a loss of $1 million in Q3 2023.

Salaries and wages also increased significantly in the most recent quarter (246%) compared to the similar period of 2023 due to a higher number of employees in sales and management roles.

SSC lists $9.5 million in raw material and processed intermediates in its inventory as of March 31, 2024, compared to $7.7 million as of December 31, 2023. The company says this increase is due to its acquisition of Lamplighter and in preparation for increased sales volumes.

As of March 31, 2024, SSC had a working capital surplus of $4.3 million, up from $3.7 million as of December 31, 2023.

“What we want to do is we want to bring solventless products to larger markets. And the largest markets in cannabis right now are infused pre rolls, vapes, and its predominantly flavoured distillate.”

Indiva reports strong edibles sales, net loss of $1.8 million in Q1 2024

Written by Sarah Clark on May 23, 2024. Posted in Financials.

Indiva reported a net loss of $1.8 million from $9.3 million in net revenue in the first three months of 2024 as the Ontario producer maintained its market position as top edibles sales in several major provinces.

The company’s gross and net revenue increased from the same reporting period in 2023, while its net loss decreased by 27% year-over-year.

Indiva holds the top market share in the edibles category in BC, Alberta, and Ontario with the sales of its Pearls by Grön gummies, No Future gummies, Bhang Chocolate, 1432 Chocolate, and Doppio Sandwich Cookies.

The company’s net revenue in Q1 2024 of $9.3 million was a 14.1% sequential decrease from Q4 2023 and a 0.9% decrease year-over-year from Q1 2023.

While edibles sales were driven by its Pearls brand, which saw net revenue grow by more than 160% year-over-year, revenues were tempered by an 85% decline in year-over-year sales of its Wana Sour Gummies line of products, as well as the loss of revenue from its lozenges, which Health Canada determined were not compliant in the edibles category.

Indiva says the loss of revenue from this latter product category being removed from shelves reduced net revenue in Q1 2024 by more than $1.3 million compared to the same quarter in 2023.

Net revenue from edible products was the majority (89.7%) of Indiva’s revenue at $8.4 million in Q1 2024, up 14.5% from $7.3 million in the same period in 2023.

Gross profit increased by 18% to $2.8 million, 29.7% of net revenue, compared to $2.3 million or 24.8% of net revenue in Q1 2023.

The company sold products containing 186 million milligrams of cannabinoids in the first three months of 2024, a 14.7% decrease when compared to the 218 million milligrams in product sold in Q4 2023, but a 66.3% increase from the 112 million milligrams sold in Q1 2023.

EBITDA was a loss of $0.2 million in the quarter. In comparison, adjusted EBITDA decreased to a profit of $0.1 million in Q1 2024, compared to a profit of $1.5 million in Q4 2023, and a profit of $0.4 million in Q1 2023.

Indiva’s Blips products, which come in 25 and 55 pack options, have somewhat replaced sales of the company’s lozenges line, offering consumers tablets of 10 mg THC per serving. The company launched its 55-pack to its existing 25-pack of these tablets in Alberta and British Columbia, and expects them to hit Ontario in June 2024.

Indiva also expanded its offering of Indiva Blips Tablets with two additional new 20-count SKUs, one with a cannabinoid ratio of 1:2 THC:CBG that will ship to British Columbia and Alberta in May, and the other with 1:1 THC:CBD, which will also ship to Alberta in May.

In April 2024, Indiva repaid $2 million of the principal amount outstanding from a strategic investment of $22 million provided by cannabis company SNDL.

The Company expects that it will need to raise additional financing in the form of debt and/or equity to continue funding its operations, as well as its convertible debenture repayments and capital expenditures.

The Company also expects its Q2 2024 net revenue to be higher on a sequential basis and year-over-year, exceeding $10 million. This is partly based on record net revenue in April 2024, driven by sales of its Pearls gummies, as well as its No Future gummies and Indiva Blips tablets. It also expects margins to improve sequentially in Q2 2024 due to higher sales, improved product mix, and improved overhead absorption. The company also expects record net revenue for fiscal year 2024.

“We are very pleased with our performance in the first quarter of 2024, our seasonally weakest quarter,” said Niel Marotta, President and Chief Executive Officer of Indiva. “Indiva’s business has transformed in the last year, as greater than 50% of our net revenue, specifically the revenue from Wana which has declined due to the transition to contract manufacturing, and the elimination of revenue from lozenges, has been replaced in the last 12 months.

“Now that these difficult cross currents have subsided, Indiva is positioned to demonstrate sustainable organic growth in its core brands without fighting against the loss of revenue from Wana and lozenges. Growth in our core brands, namely Pearls gummies, where depletions in the big three provinces have more than doubled year-over-year, and the continued growth of the No Future and Blips brands, more than offset the loss of net revenue caused by the movement to contract manufacturing of Wana and the discontinuation of lozenges caused by regulatory requirements. Greater than 30% of our net revenue in Q1 2024 was derived from brands created and owned by Indiva, including Indiva 1432 Chocolate, Indiva Blips tablets, Indiva Doppio Sandwich Cookies, and No Future Gummies and Vapes, up from 20% of net revenue in Q1 2023. Indiva remains committed to product innovation that will support both industry and edible category growth and we have a robust pipeline of new products across No Future, Pearls and Indiva Blips brands which will hit market between June and September of 2024.”