Red Light Holland Corp. (CSE: TRIP) (OTC Pink: TRUFF) reported its financial results for the fiscal third quarter ending December 31, 2021. Red Light said it generated revenues of $622,247 for the quarter resulting in a gross profit of $232,792, an increase of $75,822 (or 48.3%) over the previously reported quarter. All amounts are expressed in Canadian dollars.
“As a result of our team’s hard work and commitment, I am pleased to announce revenue and gross profit increased by 28% and 48%, respectively, during the third quarter. We realized growth in both the Netherlands and Canada through SR Wholesale and Happy Caps, as increased revenue remains our core focus. We are on-track with the strong foundation that we are building and we are excited about future revenue generation with AEM, which is now in early-stage production, current and future CPG expansion, and other potential strategic acquisitive opportunities,” said Todd Shapiro, Red Light Holland CEO and Director. “Our mission remains as well: to provide affordable and equitable naturally-occurring adult access via technology, education, information and responsible use. As you know, I love marketing and brand building – we will push even harder in the near future with impactful marketing strategies with the continued goal of Red Light Holland being the leader in the Rec and Tech psychedelic’s sector. We will provide updates shortly regarding Scarlette Lillie Science and Innovation (MERA) in St. Vincent, Wisdom Truffle pre-sales, and we continue to identify and analyze near term merger and acquisition transactions while remaining cautious with our spending habits. I’m very proud of our energetic and passionate Red Light Holland team as we keep delivering and putting the pieces of the puzzle together. I am grateful for our shareholders’ patience and continued support. Feel free to contact me anytime with the email provided below.”
In November 2020, Red Light began growing its second crop which was anticipated to yield 1,000,000 grams of the Psilocybe Mexicana, Psilocybe Galindoi, and Psilocybe Tampanensis strains of truffles (the “Second Batch”). The Second Batch became available for harvest in calendar Q2 2021. For clarity, once a batch is ready for harvest, the harvest does not immediately have to take place but rather can be done several months later. The company has allocated the Second Batch for packaging and distribution within the Netherlands (under the iMicrodose” brand) and wholesale distribution. As of the date of the filed MD&A, approximately 661,000 grams of the harvest have been sold. The company said it plans to continue selling truffles from the second batch throughout the calendar second quarter of 2022.
In January 2022, Red Light began a continuous production schedule of smaller batch sizes of approximately 100,000 grams (the “Continuous Batches”). This new production schedule allows for the increased flexibility of strain selection and production process to ensure that we meet customer demand and improve harvest yields to reduce production costs per gram.
Sarah Hashkes, Red Light Holland’s CTIO added, “With the recently published amendments to Health Canada’s Special Access Program which now allows physicians to request access to psilocybin for patients in medical need on a case-by-case basis, Red Light Holland is looking ahead to participating in this changing landscape. Our research has resulted in significant steps towards the standardization of determining the appropriate dosages required in emerging markets as a result of Health Canada’s Special Access Program and the state of Oregon’s Measure 109. We have also expanded our education and advocacy by partnering with Psychedelic Medicine Alliance Washington, a grassroots movement in the state of Washington.”
In January 2022, Red Light Oregon sent a report to the Oregon Health Authority and to the Oregon Advisory Board focused on microdosing research along with specific recommendations for microdosing within Oregon’s Measure 109.
With regards to the strength of the current balance sheet, David Ascott, Red Light Holland Chief Financial Officer, added “Our financial position remains strong, and the Company currently has sufficient capital to fund its ongoing business development and future growth and expansion plans for the foreseeable future. The working capital as of December 31, 2021, is $27.1 million which includes $27.3 million of cash and cash equivalents.”