SLANG Worldwide Inc. (CSE: SLNG) (OTCQB: SLGWF) revenues rose in the second quarter as the company looks toward snapping up new opportunities through a new M&A commission. The cannabis consumer packaged goods company released financial results for the second quarter ending June 30, 2022.
Slang’s second quarter revenues totaled $9.87 million, versus $10.50 million in the same period last year; and $8.37 million sequentially. The company recorded a net loss of $3.4 million versus $3.7 million in the same quarter last year, according to SEDAR filings. Earnings went for a loss of three cents a share versus a loss of five cents a share in the same period last year.
“The success of our operational transformation implemented at the end of 2021 continues to be reflected in our quarterly financial results,” said interim CEO and chairman Drew McManigle. “With operating efficiencies and a streamlined infrastructure in place, we are in the right position to achieve ongoing top and bottom-line growth as we leverage a stronger operational footprint and introduce new products to the market.”
Slang posted a gross profit of $4.49 million — 46% gross margin — in the second quarter, versus $3.67 million — 35% gross margin — in the same period last year, representing a 22% increase year-over-year and 31% increase in gross margin.
Adjusted EBITDA totaled $460,000 in the second quarter, versus $903,000 in the same quarter last year.
The company said that operating expenses this quarter was reduced by $430,000, or 6%, versus the previous quarter — excluding a $8.72 million recovery of previous credit losses. The company said this marks the second consecutive quarterly operating expense reduction, “which is a result of the cost cutting and restructuring initiatives implemented in Q4 2021 and Q1 2022.”
Slang had $15.72 million worth of cash and restricted cash by the end of the quarter versus to $20.83 million in the fourth quarter last year and $16.56 million sequentially.
Slang went through a shake up last November after a slew of executives departed in a C-suite overhaul. Newly-minted McManigle eventually issued a letter to its shareholders outlining the company’s plans to cut costs. McManigle is the founder and CEO of MACCO Restructuring Group. He said he planned on tapping Macco’s resources for strategic reviews and business plan implementation.
Since then, the company has said it would wind down operations in Oregon in favor of consolidating expansion in Colorado. Overall, the company has said that it would be pivoting its strategic agenda and focusing on its core markets of Colorado and Vermont.
“Our Board of Directors has recently established an M&A committee chaired by Kevin Albert and will continue to focus on new M&A opportunities while we organically grow our most popular brands,” said McManigle. “I am proud of the progress we have made, and the position SLANG is now in. I look forward to sharing our continued progress and the new level of growth we are set to achieve.”