Flora Growth Corp. (Nasdaq: FLGC) recorded its first-ever profitable quarter in the period ended Sept. 30, with net income of $1.1 million.
The Fort Lauderdale, Florida-based company reported a $7.4 million loss in the same quarter of the prior year. The profitability narrative was buoyed by a substantial revenue increase of 78% year-over-year, generating $17.3 million in the quarter.
The surge in sales was accompanied by a 6% year-over-year increase in gross profit to $4.9 million.
The upturn follows a deliberate shedding of unprofitable operations and a concerted effort to concentrate on high-growth potential areas, a strategy championed by CEO Clifford Starke.
“The third quarter was a record quarter for Flora,” Starke said in a statement. “Our efforts to cut costs, divest unprofitable operations, and focus on growing segments have begun to pay off. For the first time in the company’s history, Flora delivered a profitable, EBITDA-positive, and operating cashflow-positive quarter.”
Despite the positive quarterly results, the company has accumulated a net loss of $47.3 million year-to-date, which includes substantial one-time costs related to the restructuring efforts.
Flora saw positive operating cash flow of $500,000, a solid reversal from the $4 million cash burn in the same quarter last year. The company has a net working capital of $7.3 million.
“The business transformation has been productive, and we have achieved our short-term goals,” Starke said. “Now we will focus on execution and growing the businesses for scale and profitability.”