KushCo Holdings, Inc. KSHB expects that its preliminary and unaudited fiscal third quarter 2021 revenue will range between $27.5 million and $28 million, representing an increase between 21% and 26% on a year-over-year basis.
The revenue growth can be mainly attributed to a spike in sales to the company's top 25 customers, including several multi-state operators, licensed producers and brands.
The Cypress, California-based company also projects that revenue from these customers will spike over 60% to at least $20.5 million in the third quarter, compared to $12.7 million in the same period of last year.
Nick Kovacevich, KushCo's co-founder, chairman and CEO, disclosed that "24 of our top 25 customers in fiscal Q2 purchased similar products again in fiscal Q3, albeit not requiring the same quantities they did in the second quarter."
The company plans to grow the base of its elite customers over time, not just over a quarter, Kovacevich explained further.
"We have spent the last three years cultivating this elite customer base, and we are even more excited by the prospect of cross-selling these customers and others with proprietary owned products as we move closer toward the consummation of our merger with Greenlane," Kovacevich added.
KushCo & Greenlane Merger
In March, KushCo and Greenlane Holdings, Inc. GNLN confirmed that they plan to merge, with KuscCo becoming a wholly-owned subsidiary of Greenlane.
The transaction, poised to close either late in the second quarter or early in the third quarter of 2021 was unanimously approved by the boards of directors of both companies and a special independent committee comprised of Greenlane's independent directors.
Kovacevich, who will become CEO of the joint company, revealed earlier that the idea of the merger had been discussed for several years. He added that it "catapults us to that next level and puts us on scale with really anyone out there, from a size and infrastructure standpoint, and global reach."
Price Action: KushCo Holdings shares were trading 0.79% lower at 94 cents per share at the time of writing.
Photo by Avery Meeker on Unsplash
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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