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Fire & Flower Revenue Spikes 142% YoY On Heels Of Buying Spree

December 15, 2020 1:10 pm
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Fire & Flower Revenue Spikes 142% YoY On Heels Of Buying Spree

Throughout the third quarter, cannabis retailer Fire & Flower Holdings Corp. (TSX:FAF) (OTCQX:FFLWF) found itself on the hunt for acquisition targets. 

According to the company's most recent earnings statement, the strategy paid off.

Fire & Flower generated around $33.1 million at a gross profit of 34.7% in the third quarter of this fiscal year. That's a year-over-year and sequential increase of 142% and 15.8%, respectively.

The Toronto-based company also reported achieving an adjusted positive EBITDA of $1.2 million for the quarter, versus a $0.3 million loss in the prior quarter.

Fire & Flower CEO Trevor Fencott said that "achievement of positive Adjusted EBITDA is a significant milestone and demonstrates our continued track record of delivering on our corporate objectives."

Other highlights from the earnings report include:

  • The company's Open Fields Distribution Business contributed $1 million of gross profit, representing an increase of 22% compared to the previous period
  • Its Hifyre digital retail and analytics platform contributed $1.5 million over the same period
  • Loss from operations was roughly $500,000, compared to approximately $6 million in the corresponding quarter of last year
  • Total expenses rose by 12% over the year to around $12 million
  • Net loss and comprehensive loss was $25.8 million

Ontario Expansions

During the quarter, Fire & Flower agreed to purchase Satica Cannabis store in Toronto for $750,000 in cash, the business' net working capital at the closing date, and 248,410 in FFHC common shares, under the deal with 2673801Ontario Inc.

In addition, it also opted to take over two NCannabis retail locations as a part of the purchase deal with Busboy Ventures Inc. The price tag included $700,000 in cash, the business's net capital at the closing date, and some 2.2 million FFHC common shares.

In November, the cannabis retailer confirmed the acquisition of Friendly Stranger Holdings Corp., expanding its footprint in Ontario by 11 additional licensed cannabis retail stores.