C21 Investments Inc. (OTCQB: CXXIF) announced unaudited results for its first quarter ending April 30, 2020, with revenue of $8.15 million, an increase of 5% over the same time period for last year. The revenue jumped 86% over the fourth quarter.
The income from operation was $542,000 for the first quarter, which fell dramatically from the fourth quarter’s income of $1.1 million. C21 recorded a one-time, non-cash restructuring charge of $1.2 million from the final settlement of the acquisition of Phantom Farms. The net loss per share for the first quarter was ($0.02). Excluding the one-time, non-cash restructuring costs, the net loss per share was ($0.00).
C21 President and CEO, Sonny Newman said, “We met the challenges imposed by the pandemic head-on and thanks to the hard work of the team, we have strengthened the company for the future. We have seen the impact of these efforts in our Q2 sales results, where we rebounded to record revenue at our Nevada dispensaries.”
Newman was referring to Nevada regulators who limited statewide cannabis sales to delivery-only due to the COVID-19 pandemic. C21 shifted to six weeks of operating with “delivery-only” at the Nevada dispensaries. The company also increased its third-party delivery, and established an in-house delivery capability.
He added, “As restrictions eased at the end of the quarter, the company engineered curbside pickup as its third sales channel. C21 continued to streamline its Oregon operations and in February acquired the Phantom Farms real estate associated with its outdoor farms in Southern Oregon.” The company has continued to roll-out its Oregon brands into Nevada with Hood Oil and Phantom Farms flower performing as top-selling products in the retail stores.
The company’s gross margin was $2.9 million (36%), before fair value adjustments. This reflects the increased sales costs resulting from the six week period of “delivery-only” operations and costs associated with integrating the Oregon operations.