Earnings Update: Organigram, Grow Generation, KushCo
Organigram Plans To Ramp Up Staff
The company reported a net loss of $34.4 million, or 17 cents per share on a diluted basis, which compares to a net loss of $900,000, or one cent per share in the same quarter of fiscal 2020.
Net revenue hovered $19.3 million, versus $25.2 million in the first quarter of fiscal 2020, due to lower wholesale revenue from licensed producers and a lower average selling price in the quarter.
The New Brunswick-based cannabis company also reported a negative gross margin for the quarter of $16.7 million, compared to the Q1 2020's positive gross margin of $11.2 million.
Adjusted EBITDA was a loss of $6.4 million, versus a positive adjusted EBITDA of $5.7 million.
Organigram highlighted it has been working on advancing its product portfolio since July by launching 53 new SKUs and announced plans to launch extra 14 SKUs before the end of the second quarter of fiscal 2021.
The company also shared its plans to hire around 100 more workers, mainly in cultivation, and an extra 30 in packaging.
The company ended the quarter having $134 million in cash and short-term investment, while in December made a $55 million repayment on a term loan.
“We are pleased with our double-digit sales growth in the Canadian adult-use recreational market this past quarter as it reflects the success of many of our new product launches, particularly in the dried flower value segment,” stated CEO Greg Engel.
Organigram looks forward to "new higher-margin Edison dried flower offerings contributing substantially to overall revenue with even more new products to come in the next few quarters," Engel added.
GrowGeneration Achieves Record Full-Year Revenues
Moreover, the company expects its full-year 2021 revenue to range between $335 million-$350 million.
Over the last three months of fiscal 2020, revenue increased to $61.5 million compared to $25.4 million in the corresponding quarter of 2019.
For the full year, same-store sales went up by 63% year-over-year, while fourth-quarter same-store sales rose by 58% compared to the same period of the last year.
The Denver-based company purchased 14 new stores in 2020, bringing its total retail footprint to 39 retail locations across the country.
"We delivered strong shareholder value in 2020, with triple-digit revenue growth despite unprecedented challenges and an uncertain environment," CEO Darren Lampert said, crediting the growth to "strategic acquisitions" of hydroponic stores, same-store sales, and the expansion of the company's omnichannel and private label offerings.
The company increased its 2021 adjusted EBITDA guidance to $38 million – $40 million. In addition, it also said it projects the number of its store locations would increase to 55.
In December, GrowGeneration was poised to secure $125 million via its stock's public offering.
KushCo's December Sales Reach $14.7M
Cypress, a California-based company, attributed the decline in revenue to the elimination of the hemp trading division, as well as the implementation of its comprehensive strategic plan.
KushCo also achieved positive adjusted EBITDA of $500,000 compared to a $6.8 million loss in the previous year. Moreover, it’s the company’s second consecutive quarter of positive adjusted EBITDA.
In addition, the company hit record December sales of $14.7 million.
The company's selling, general and administrative expenses amounted to roughly $8.8 million versus $21.1 million in the prior year and $10.3 million in the previous quarter.
Net loss (on a GAAP basis) was around $4.5 million for the year. Net loss (on a non-GAAP basis) amounted to $1.9 million for the quarter.
“We were expecting more significant growth during the quarter, but like many other importers of goods, we were faced with temporary, yet unexpected and uncontrollable, shipping delays due to record-breaking shipments to U.S. ports around the holiday season, which were exacerbated by new COVID-19 restrictions,” KushCo co-founder and CEO Nick Kovacevich said.
The company expects 2021 net revenue to be between $130 million and $160 million.
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