Heritage Cannabis Q2 FY23 Revenue Declines 1.5% YoY, Here Is What You Need To Know

Heritage Cannabis Holdings Corp. HERTF CANN released its financial results as at and for the three months ended April 30, 2023, revealing net revenue of CA$7.4 million ($5.6 million), a decrease of 1.5% compared to CA$7.5 million in Q2 FY 2022.

Q2 2023 Financial Highlights

• Gross margin was CA$3.3 million compared to CA$3.2 million for the three months ended April 30, 2022. The increase in gross margin of CA$119,852 was primarily a result of improved production efficiencies in addition to a lower excise rate of 27.4% compared to 28.3% in the prior period which was driven by increased bulk B2B sales which provides less exposure to excise taxes.

• Comprehensive loss of CA$2 million or CA$0.00 loss per share compared to a comprehensive loss of CA$500,614 or CA$0.00 loss per share for the three months ended April 30, 2022. The increase in comprehensive loss of CA$1.5 million during this period was attributable to higher interest costs as a result of rising interest rates and unrealized losses on derivative liabilities as a result of revaluations.

• Cash at the end of the period was CA$4 million.

“We are very pleased to have achieved gross margin growth once again this quarter, despite the lack of much needed regulatory changes within the industry in Canada. We have remained extremely focused on managing our costs and quarterly burn-rate while harnessing a continuous improvement approach to maximize our product output”, stated David Schwede, CEO of Heritage. “Our entry into the U.S. market is performing well with both our Missouri and West Virginia facilities gaining a strong foothold in their respective markets, and with our RAD brand launching in New York this summer we are building out our capital efficient footprint in the U.S. Similar to our growing relationship with an Australian firm, we continue to evaluate new international markets to introduce our portfolio of in-demand products.”

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Photo by Esteban López on Unsplash

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