Auxly Reports Another Record Quarter, Expects To Be Adjusted EBITDA Positive By Year's End

Author: Nina Zdinjak | November 15, 2021 10:28am

On Monday, Auxly Cannabis Group Inc. (TSX:XLY) (OTCQX:CBWTF) disclosed its third-quarter total net revenue of CA$24.5 million ($19.5 million), which is up 95% year over year and 17% sequentially. The cannabis-focused consumer packaged goods company also reported it has strengthened its board of directors with the appointment of Murray McGowan, chief strategy and development officer for Imperial Brands (OTC:IMBBY).

Third Quarter Financial Summary

Adjusted EBITDA loss of CA$6.5 million, compared to an adjusted EBITDA loss of CA$6.7 million in the prior-year period; EBITDA figures were a result of a higher cost of sales associated with changes in product mix and additional costs associated with the introduction of new products;
Net loss amounted to CA$13.52 million, compared to a loss of CA$17.8 million in the third quarter of 2020;
Net loss per basic and diluted share was CA$0.02, compared to a loss per share of CA$0.03 in the same period year ago; Gross profit was CA$4.66 million, versus a gross profit of CA$3.54 million.
At the end of the reporting period on Sep. 30, the company held CA$37.22 million in cash and equivalents.

“We are proud to report another record revenue quarter for Auxly,” Hugo Alves, CEO of Auxly stated. "We continued to see growth in our Canadian cannabis recreational sales in the quarter, driven by our expanding product offering in dried flower and pre-rolls as well as our continued leadership of the 2.0 product segment where we maintained our #1 overall position driven by our dominance in the vapor segment where our consumers rewarded us with 24% of total national market share.”

Third Quarter Milestones

Continued growth in national recreational cannabis sales, maintaining the #1 LP position in Cannabis 2.0 sales with 15.6% market share and securing the #6 LP position in total national recreational cannabis sales in the quarter, with continued growth in October moving the Company into the #5 LP position with 7.3% share of the market.
Continued leadership in new product innovation with the launch of new and differentiated SKUs throughout the quarter, including the introduction of Back Forty 40s and Kolab Project 132 Series Live Resin Black Cherry Punch Soft Chews - Canada’s first cannabis-infused live resin edible.

Outlook

The Company’s overall objectives for 2021, which may be impacted by the COVID-19 pandemic are as follows:

Continued leadership and strength in the Cannabis 2.0 Products market;
Focused expansion of Cannabis 1.0 Products;
Become a top 5 licensed producer in Canada by total market share in adult recreational cannabis sales;
Continue to take measures to improve cash flows and finance the business;
Become Adjusted EBITDA positive by the end of the calendar year;
Leverage the Sunens facility to establish a secure supply of cannabis and reduce reliance on open market purchasing; and
Explore possible cannabis market entry strategies in regulated international markets on an asset-light basis.

Price Action

Auxly’s shares closed Friday market session 0.38% higher at 27 cents per share.

Photo: Courtesy of herbadea Berlin on Unsplash

Posted In: CBWTF IMBBY TSX:XLY