StaffCannara Biotech Inc. (OTCQB: LOVFF) announced its third-quarter results for the period ending May 31, 2021, with total revenue of $7.2 million, including $5.9 million in cannabis sales, net of excise tax. this was a huge gain over last year’s $763,906. The net income for the company was $1.7 million versus last year’s net loss of $2.5 million.
“This quarter’s results are a testament to our strategy’s efficacy and management’s focus,” said Zohar Krivorot, President & Chief Executive Officer of Cannara. “With impressive revenue generation in our first full quarter of sales in retail market, the closing of our additional $5 million private placement, and headline acquisition of our latest one million square foot facility in Valleyfield, we are now positioned among the country’s leading cannabis producers.”
Cannara said it sold approximately 1,400 kg of cannabis it had in inventory from previous harvests for a total value of $1,265,000.
“Our positive net income and strong gross margins confirm our operational excellence, uniquely lean company structure, and continued growth,” said Nicholas Sosiak, Chief Financial Officer of Cannara. “Cannara’s core competence is our differentiated model that underscores our ability to excel at maximizing the use of our resources. We are executing against this proven model, as we continue to scale our business in the next chapter of our growth roadmap.”
Following the end of the quarter, Cannara acquired a one million sq. ft. state-of-the-art cultivation facility from The Green Organic Dutchman Ltd. (“TGOD”) for $27 million, providing it with the ability to reach an annual cultivation capacity of 125,000 kg of premium-grade cannabis. The company also launched an additional six SKUs in the market under the Tribal and Orchid CBD brands in June 2021 and released three new cannabis genetics, Cuban Linx, Do-Si-Dos, CBD Runtz, in dried flower and pre-roll formats
On the financial side, Cannara closed private placements of $24.3 million priced at a premium to the market price at the time of the transaction and $5.7 million in convertible debentures bearing interest at 4% to fund the acquisition of the Valleyfield facility and related working capital expenditures. It converted the company’s existing $5 million credit facilities bearing interest at 13% into a convertible debenture bearing 4% interest and subject to a statutory hold period of four months and one day from the date of issuance.
In addition, it uplisted to the TSX Venture (TSXV) from the Canadian Stock Exchange (CSE) on April 8, 2021, reflecting the company’s maturity and the commercialization of its operational strategy.
