For the quarter ended April 30, 2021, the cannabis products company reported revenue up 251% to $ 4.6 million, from $ 1.8 million in the fiscal first quarter of 2021.
Heritage Cannabis Holdings Corp () () released second quarter tax results that delivered strong earnings and strong revenue growth thanks to the growing popularity of the company’s portfolio of six brands.
For the quarter ended April 30, 2021, the Toronto-based cannabis company reported revenue up 251% to $ 4.6 million, from $ 1.8 million in the first quarter of 2021. The company Also saw its 2Q revenue jump 338% year over year.
The company said the revenue expansion was propelled by Heritage’s expanded product portfolio which now includes concentrates, vapes, topicals, edibles and dried flowers. “Provincial replenishment rates and market penetration continue to show positive trends,” he noted.
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Meanwhile, Heritage’s gross margin rose to a record $ 1.5 million, with gross margins improving to 32% from 28% in the first quarter of 2021. The company said the selling expenses , general and administrative (SG&A) as a percentage of turnover fell to 66%. during the quarter, compared to 142% in the first quarter of 2021.
Heritage has a strong balance sheet with net working capital of $ 25.3 million and cash flow increasing to $ 11 million as of April 30, 2021, supported by a successful stock offering that closed during the quarter.
“We are excited about the results generated this quarter and the future outlook for the business,” said Clint Sharples, CEO of Heritage Cannabis, in the earnings statement. “We have moved from providing strictly contract manufacturing services to a company with a portfolio of six internal brands in Canada and an e-commerce medical site in the United States. The current quarter results show the progress of this change which started less than a year ago, and we continue to build in the third quarter of this fiscal year.
In April, Heritage announced its intention to enter the U.S. cannabis market through an expanded relationship with Merida Capital Holdings. Later in May of this year, Heritage announced the launch of its premium ArthroCBD softgels in the US market to help people seeking “symptomatic relief”.
“While we are experiencing accelerated product distribution across the country, we still have underserved markets to develop and we still need to significantly enter the multi-billion dollar US recreational market,” added Sharples.
Heritage also entered into a five-year partnership during the period with Como Health LLC, doing business as 3Fifteen Primo Cannabis, which will see Heritage produce branded products for medical cannabis consumers in the US state of Missouri. .
Sharples noted that from a financial standpoint, the company has extended its debt repayment window until the end of 2022 and improved its working capital situation. “With continued strong sales growth and cost management, we will ensure we remain in a strong financial position to fund growth and increase shareholder value,” he added.
“Although this is the first quarter of Premium 5 under the Heritage banner, we are extremely pleased with the performance of the organization,” said David Schwede, president of the Leisure division of Heritage.
New provincial markets
In a separate statement, Heritage also revealed that it continues to expand into new provincial markets with an initial order from Newfoundland and Labrador Liquor Corporation (NLC), the local recreational cannabis retailer, to sell its Purefarma, Pura brands. Vida, RAD, Premium 5 and feel good.
“With this order, Heritage will see its five popular recreational brands available in Newfoundland and Labrador, consisting of 27 individual SKUs,” the company said.
Beginning in July, Newfoundland and Labrador customers will initially be able to purchase Heritage products at Tweed stores across the province.
“We have seen the Heritage brands perform well in the concentrate category in every province we enter. “We are very excited to enter the Newfoundland and Labrador market with the ordering of the NLC and initial availability in Tweed stores.
Heritage is a vertically integrated seed-to-sale cannabis company with five operating subsidiaries. Based in Toronto, the company currently has two licensed producers approved by Health Canada, through its subsidiaries Voyage Cannabis and CannaCure Corp.
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