Auxly Cannabis Group Inc. (TSX.V – XLY) (OTCQX: CBWTF) released its financial results for the three ending June 30, 2021, with total revenue of $29.5 million versus last year’s $8.3 million. Auxly’s total net revenues from the sale of adult-use cannabis in Canada were $20.9 million for the quarter, more than double the same period in 2020. The net loss from continuing operations was $3.6 million versus last year’s $30 million. The adjusted EBITDA improved to a negative $3.3 million versus last year’s negative $10.4 million.
Hugo Alves, CEO of Auxly, commented: “We are thrilled to report a record quarter for Auxly where we saw significant growth in our net revenue, adjusted EBITDA and our share of the recreational cannabis market. We continued to hold the #1 spot in Cannabis 2.0 Product sales nationally, through our leadership in the vapour segment and consumer-driven innovations in new product categories such as concentrates. Our strong momentum in retail sales and the increasing prevalence of our brands within the segments that they compete, are the result of our focused strategy and the investments we’ve made in the human resources, assets and capabilities that we believe are needed to win in the consumer market and which differentiate Auxly from its competitors. We look forward to launching new and exciting products for consumers to enjoy as we continue to execute against our objectives in 2021.”
Auxly said that net revenues improved during the second quarter of 2021 by $14.0 million over the same period of 2020 and by $11.7 million over the first quarter of 2021 primarily due to its increased retail cannabis sales nationally and improvements in the company’s provincial customers’ inventory purchases following the prior quarter pullback. Consistent with prior periods, as the company does not participate in the Quebec market, approximately 85% of cannabis sales during the second quarter of 2021 originated from sales to British Columbia, Alberta, and Ontario.
Net income was $8.7 million for the quarter which represented a net income of $0.01 per share on a basic and diluted basis. Auxly said that the improvement in net income and loss positions was a result of net income of $12.3 million related to the sale of KGK, recognition of a gain from the Imperial Brands Debenture Amendments, improvements in continuing operating gross profits and income tax recoveries, partially offset by an impairment charge related to the Curative sale.
Auxly managed to cut the company’s expenses. Selling, general and administrative expenses were $12.1 million during the second quarter and $21.3 million years to date 2021, a decrease of $1.5 million and $5.1 million as compared to the same periods in 2020.