Organigram Archives - Green Market Report

StaffNovember 29, 2022
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The Daily Hit is a recap of cannabis business news for Nov. 29, 2022.

ON THE SITE

Flowr Corp. Throws in Towel, Looks for Buyers

Toronto-based The Flowr Corp., (TSX.V: FLWR) (OTC: FLWPF) is officially on the market after it reported that it does not have enough of a runway to make it to the end of the third quarter. According to regulatory filings, potential bidders submitted binding offers last Friday, with financial firm Ernst & Young Inc. acting as a monitor. Read more here.

RIV Capital Closing in on New York Acquisition, Loses $142 Million in Q2

RIV Capital Inc. (CSE: RIV) (OTC: CNPOF) posted a $142.3 million loss for its second quarter of fiscal 2023, but most of the losses were chalked up to a “goodwill impairment charge” as part of the upcoming acquisition of New York-based Etain – a deal that RIV Capital leadership said would give the firm a national foundation for future growth. Read more here.

Pritzker Names New Cannabis Chief

Erin Johnson, a lawyer for Amazon and state government veteran, has been named the state’s top cannabis regulator. Johnson is an associate general counsel for Amazon Web Services but was chief of staff at the Illinois Department of Juvenile Justice in the Pritzker administration from 2019 to mid-2021. Previously she was associate general counsel and chief diversity officer from 2016 to 2018 for then-Gov. Bruce Rauner. Read more here.

More Financial Reports:

IN OTHER NEWS

High Times

The owners of High Times magazine have dropped their lawsuit against a former majority shareholder of the publication’s parent company, according to a joint stipulation entered Monday in California federal court. The stipulation notes that the action has been dismissed with prejudice and holds that each party bears their own costs. It makes no mention of a settlement, and counsel for the parties did not immediately respond to requests for comment on Monday. Read more here.

The Valens Company Inc.

Shareholders of the Valens Company Inc. (TSX: VLNS) (Nasdaq: VLNS)  voted in favor of the resolution approving the plan for SNDL Inc. to acquire all of the issued and outstanding common shares of Valens on the basis of 0.3334 of a SNDL common share for each outstanding Valens common share. More than 96% of votes cast at the company’s special meeting of shareholders held on Nov. 29 were in favor of the resolution. Read more here.

Rhode Island

As Rhode Island is set to begin recreational marijuana sales Thursday, state regulators are ramping up their staff as they oversee the industry. The state legalized adult recreational cannabis in May, with the planned start of sales on Dec. 1. Read more here.


Debra BorchardtJuly 14, 2022
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Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) announced its results for the third quarter ending May 31, 2022. Organigram said that revenue increased 90% to $55 million, versus $29 million in the same time period in 2021. This beat the Yahoo Finance average analyst estimates for revenue of $26 million, however, it increased over the second quarter’s revenue of $43 million. The company attributed the increase to growth in adult-use recreational revenue, but it was partly offset by a lower average net selling price due to product mix and a decrease in medical revenue.

Organigram trimmed its net losses to $2.8 million versus last year’s net loss of $4.0 million. the company said this was due to higher gross margins, lower inventory provisions, and lower financing costs.

“We are pleased to see continued strength in our recreational business with our increasing market share. We achieved record net revenue results which we expect to surpass again in Q4 on the strength of new product listings, increased retail sales momentum, and international shipments,” said Beena Goldenberg, Chief Executive Officer. “We have built an enduring brand with SHRED that has proven to attract consumers across multiple product categories. This market strength is bolstered by introducing new SKUs in the derivative space, including Edison JOLTS, which are now available in three flavors, Edison live resin vapes, Tremblant hash, and Monjour soft chews in the wellness segment.”

Organigram also said it achieved the #3 position among Canadian licensed producers with 7.8% market share. In June 2022 the company had an 8.5% share of the recreational adult-use market. It said it continues to hold the #1 position in dried flower, the largest category of the Canadian cannabis market, and the #3 market position nationally in gummies.

Expenses

Organigram did note that its cost of sales increased sequentially to $29.4 million from $23.4 million and that this was due to an increase in sales volume in the adult-use recreational market. However, the net cash used in operating activities fell to $6.3 million and was primarily driven by the adjusted EBITDA net of the investment in working capital assets. In the fiscal third quarter of 2021, net cash used in operating activities was $10.8 million. The company had a comfortable cash cushion with unrestricted cash and a short-term investments balance of $127 million compared to $184 million on August 31, 2021. Organigram said it believes its capital position is healthy and that there is sufficient liquidity available for the near to medium term.

Outlook

Organigram said it currently expects the fiscal fourth quarter revenue to be higher than the third quarter. “This expectation is largely due to ongoing sales momentum, stronger forecasted market growth, the company’s expanded product line in multiple segments, greater capacity to meet demand at the Moncton Campus, increased throughput at the Winnipeg facility, contributions from the Lac-Supérieur facility and increased revenue from international shipments.”

The net revenue growth is expected from the company’s products as evidenced by Organigram’s growing national adult-use recreational retail market share from 7.4% in February 2022 to 8.5% in June 2022. The company said in a statement, “In addition, the anticipated continuation of shipments to Canndoc in Israel and Cannatrek and Medcan in Australia is expected to generate higher sequential revenue in Fiscal 2022 as compared to Fiscal 2021.” The company also believes it is better equipped to fulfill demand in Fiscal 2023 with larger harvests expected compared to Fiscal 2022.

“Our success as a consumer-focused innovator continues to drive solid growth in the top line that is supported by a strong balance sheet and cash position,” stated Derrick West, Chief Financial Officer. “With our increased cultivation capacity and economies of scale from Phase 4C, and our investment in automation at all three of our manufacturing locations, we expect that both our adjusted gross and adjusted EBITDA margins will improve in Q4 and into Fiscal 2023.”


Debra BorchardtJuly 11, 2022
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It seems Canadian cannabis consumers prefer to pay higher prices for flower. A new report from Cantor Fitzgerald’s analyst Pablo Zuanic found that most of the Canadian Licensed Producers (LP’s) increased market share with higher flower prices. The only exception to the rule was Organigram (NASDAQ: OGI), which saw its market jump dramatically after dropping prices almost by half.

Flower Power

Zuanic said he analyzed the 35 companies that accounted for 90% of Canadian flower sales in 2Q22 and looked at how those companies’ market share has changed over the last two years. Due to market competition, there are now 126 companies competing in the flower space versus just 53 two years ago.  Consumers are spreading their money around and the once-dominant flower sellers are now seeing lots of competition. For example, in 2Q20 just 10 LPs accounted for 90% of flower sales. Fast forward one year to 2021 and there were 19 LPs and in the most recent second quarter, 35 LPs.

He found that the bulk of the companies gaining market share in Canadian flower actually have prices above the market average, while those losing market share have prices below the market average and in most cases have also cut prices the most. He wrote, “We think the larger players for the most part may continue to lose market share, as price cuts are not enough. Sure, it is not just about better quality, but interesting that the ones gaining share are not price discounters (ankle biters, as called by some) but those with more premium offerings.”

Significant Growth

6 LPs grew their share of flower sales by more than 3pt.  The 6 LPs which grew their flower share by more than 3pt from 2Q20 to 2Q22 had an average price per gram of $5.13, 4% below the average price of $5.36. Zuanic’s hypothesis is that market share was gained with higher prices and this doesn’t seem to track, however, the price is only 4% below average. The losers had much bigger price drops.

Minor Growth

18 LPs grew their share of flower sales by between 1-2pt. The 18 LPs which grew their flower share between 1-2pt from 2Q20 to 2Q22 had an average price per gram of $7.78, 45% above the average price of $5.36.

Market Losses

The LP’s with market share losses ranging from 3pts. to 1 pt all had prices that were anywhere from 14% below the average flower price to 41% below average prices.

Organigram Bucks Trend

The big outlier was Organigram (NASDAQ: OGI) which saw its market share for flower, increasing share from 5% in 2Q20 to 12% in 2Q22. Zuanic wrote, “Organigram gained share by reducing their flower price per gram by 48% over the two-year period from $8.82 (5% premium to 2Q20 average price per gram of $8.37) to $4.56 (15% discount to 2Q22 average price per gram of $5.36).”

Other big losers included Aurora (NASDAQ: ACB) whose flower market share plunged from 21% in 2Q20 to 2% in 2Q22. Also losing share was Tilray (NASDAQ: TLRY) whose share decreased from 19% in 2Q20 to 8% in 2Q22.

In Closing

Zuanic believes that Canadian cannabis consumers are maturing and focusing more on quality than they had in the past. Cutting prices doesn’t seem to bring in more sales. It could also be that with more competition, consumers may have a harder time choosing which flower to buy. They could be opting for the higher-priced product in order to assure their money is well-spent.


Debra BorchardtApril 12, 2022
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Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) delivered its results for the second fiscal quarter ended February 28, 2022. Organigram reported that its net revenue increased 117% to $31.8 million, from $14.6 million for the same time period in 2021. The company attributed the increase to growth in adult-use recreational revenue and international revenue, partly offset by a lower average net selling price due to product mix and a decrease in medical revenue. The company trimmed its net losses to $4 million versus last year’s net loss of $66.4 million. The drop in the net loss was primarily due to the higher sales and gross margins in the current quarter.

“The culture of innovation and consumer focus we are building at Organigram has enabled us to not only create brands that are embraced by consumers, but continually innovate within those brands and across multiple product lines. We expect that leveraging these brands will allow us to continue to drive market share,” said Beena Goldenberg, Chief Executive Officer. “In addition to our continued success at building beloved brands, our ability to increase sales in international markets and capitalize on our accretive acquisitions, such as Laurentian and EIC, continue to contribute to our solid gains in market presence and sales growth.”

Revenue Growth Expected

Organigram said it currently expects revenue to be higher in the third fiscal quarter. The company said in a statement, “This expectation is largely due to ongoing sales momentum, stronger forecasted market growth, the company’s expanded product line in multiple segments, greater capacity to meet demand at the Moncton Campus, increased throughput at the Winnipeg facility and the Laurentian acquisition.”

Organigram said it also expects to realize additional revenue through the recent acquisition of Laurentian and will make growth-focused capital expenditures at Laurentian which have the potential to further increase EBITDA generation. Since the acquisition, Organigram has accelerated the distribution and sale of Tremblant Cannabis, its flagship hash brand in Ontario, increasing distribution from 25% to 40% of retail stores and growing quarterly sales by 21% compared to Laurentian’s sales in the three months ended November 30, 2022. By leveraging Organigram’s industry-leading national distribution and field sales network, Laurentian products will be available in all Canadian provinces in Fiscal 2022.

No Cash Problems

Organigram reported that the net cash used in operating activities for the quarter was $5.3 million and that this was primarily driven by the increase in inventories. In 2021, the fiscal second-quarter net cash used in operating activities was $10.4 million, which was primarily driven by the loss from operations. As of February 28, 2022, the company said it had unrestricted cash and short-term investments balance of $151 million compared to $184 million on August 31, 2021.

“We are also progressing well with the Laurentian integration. In less than three months we have been able to significantly increase distribution and begin to implement the synergies planned at the acquisition. Automation to optimize production is also underway and expected to be complete by the end of Fiscal 2022,” added Goldenberg.


Debra BorchardtJanuary 11, 2022
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Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) delivered its results for the first fiscal quarter ending November 30, 2021, with revenue increasing 57% to $30.4 million, from $19.3 million for the same time period last year. This beat the Yahoo Finance average analyst estimate for revenue of just $23.9 million.

Organigram said the increase was primarily due to an increase in adult-use recreational revenue and international revenue, partly offset by lower average selling price due to product mix and a decrease in medical revenue. Organigram also trimmed its net loss to $1.3 million, versus last year’s net loss of $34.3 million. The company attributed it to the higher gross margin in the current quarter along with fair value adjustments on biological assets and inventories sold.

“Our record-breaking results in the first quarter of Fiscal 2022 are a testament to our successful strategy to create innovative, high-quality products that align with the evolving preferences of the various segments of cannabis consumers,” said Beena Goldenberg. “Our positive outlook for 2022 is further bolstered by the addition of Laurentian’s premium products to our portfolio, with an increased presence in Quebec and the resumption of international sales, which will continue through the year.”

In December, Organigram bought the Quebec-based Laurentian, a producer that specializes in high-quality, artisanal craft cannabis and premium Afghan hash. The acquisition accelerates and strengthens Organigram’s presence in the Quebec market and expands the company’s product portfolio. The company said it will invest at least $7 million in Laurentian to drive cultivation growth, expand processing and storage space and invest in automation. Organigram will use its direct sales team and national distribution to bring Laurentian’s products to additional Canadian provinces.

“We are also pleased with our continued progress at improving economies of scale in our operations, thus reducing operating costs and driving significant improvements in adjusted gross margin and adjusted EBITDA,” added Goldenberg. “While we previously projected to achieve positive adjusted EBITDA in Q4, with the purchase of Laurentian that will be accelerated to Q3 Fiscal 2022.”

Outlook

Looking ahead, Organigram said it expects the fiscal second-quarter revenue to be significantly higher than last year. The company said it is basing this forecast on stronger forecasted market growth and the increasing number of retail stores. In addition to that, Organigram said it is better able to fulfill the demand for its revitalized product portfolio with increased production, and revenue contributions from its newly acquired Laurentian facility. Net revenue growth is expected as the company’s adult-use recreational retail market share jumped from 4.4% in Q1 of Fiscal 2021 to 7.5% in Q1 of Fiscal 2022.

Organigram said it also expects to be positioned to generate more revenue growth from the production of soft chews and other edible products with the specialized equipment in the Winnipeg Facility under the direction of EIC leadership, who bring significant expertise in confectionery manufacturing. In Fiscal 2022, line extensions will be introduced to the company’s popular SHRED’EMS gummy and Edison Jolt lozenge SKUs.

The company also expects to realize additional revenue through the recent acquisition of Laurentian. Over the last two months of calendar 2021, Laurentian has been averaging an annual net revenue run rate of $17 million and an annual EBITDA run rate of $6 million. The Company will make growth capital expenditures at Laurentian which have the potential to further increase EBITDA generation. Laurentian’s hash and artisanal craft cannabis products complement the Company’s product line and will benefit from the company’s direct sales team and national distribution.

In addition, the resumption of shipments to Canndoc in Israel is expected to generate higher sequential revenue in Fiscal 2022 as compared to Fiscal 2021. The company believes it is better equipped to fulfill demand in Fiscal 2022 with larger harvests expected as compared to Fiscal 2021. Revenues in Fiscal 2022 to date including a shipment to Canndoc that was in excess of $3.0 million, and purchase orders received from customers, support the company’s expectation of revenue growth from Fiscal 2021 to Fiscal 2022.

 

 


Debra BorchardtDecember 21, 2021
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Organigram Holdings Inc. (NASDAQ: OGI) is buying Laurentian Organic Inc. for C$36 million, plus earnouts. The Laurentian acquisition further strengthens Organigram’s position in the Canadian market through the expansion of the company’s portfolio into premium products, including hash and craft cannabis, in addition to providing an important presence in the province of Quebec through scalable cultivation and operational footprint.

Laurentian is one of the leading hash companies in Quebec and has the current capacity to cultivate approximately 600 kg of flower and one million units of hash annually. The company said that expansion efforts are expected to increase that to approximately 3,000 kg of flower and two million units of hash by the second half of 2022. Laurentian is also expected to benefit from access to additional high-quality indoor flower supply and input material for hash from Organigram’s Moncton facility, which is expected to produce 70,000 kg of annualized production capacity by the end of fiscal 2022.

Over the last 2 months, Laurentian said it has been averaging an annual gross and net revenue run rate of $22 million and $17 million respectively, and an annual EBITDA run rate of $6 million based on its presence in Quebec, Manitoba, Saskatchewan, and most recently, Canada’s largest province, Ontario. Leveraging Organigram’s direct sales team and national distribution, Laurentian’s products will gain access to major markets currently not penetrated, including BC, Alberta and Atlantic Canada. Between local expansion planned at Laurentian’s site, synergies expected to be realized with Organigram and entrance/scale-up into new/existing markets the Company is forecasting revenues from the Laurentian and Tremblant brands to grow beyond the Company’s Fiscal 2022 year-end of August 31, 2022.

“The Laurentian acquisition marks yet another important milestone for Organigram as we continue to deepen the focus of our core business on delighting consumers with innovative products and brands that deliver unique and memorable experiences,” said Beena Goldenberg, Chief Executive Officer of Organigram. “Not only does Laurentian add two great new brands to our portfolio, it also brings us new premium product offerings with its Afghan hash and artisanal craft flower, as well as a footprint in the important market of Quebec. We look forward to building on the momentum that Laurentian has established to bring these products to even more Canadian provinces and territories.”

Laurentian was co-founded by Eric Brosseau, Mathieu Lahaie and Eric Verdier, a trio of highly passionate Quebecers who parlayed their love of cannabis into a successful cannabis company operating near the iconic Mont-Tremblant, specializing in high-quality, artisanal craft cannabis and premium Afghan hash. The hash category in Canada is increasing in importance and leveraging Organigram’s national sales and distribution network, the company believes that Laurentian’s product offerings will continue to grow nationwide at an accelerated pace, bringing Laurentian’s high-quality craft cannabis products to more consumers.

“We founded Laurentian with the goal of bringing the highest quality hash and cannabis to consumers across Canada. We are thrilled to be joining Organigram where we will have the opportunity to leverage their expertise and distribution capabilities to make this expansion goal a reality,” said Eric Brosseau, Co-Founder of Laurentian. “The Organigram team has an unrivaled customer service experience through its rigor and professional standards and dedicated national sales force and we are thrilled to be able to work with their team through the next phase of growth.”


Debra BorchardtNovember 23, 2021
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Organigram Holdings Inc. (NASDAQ: OGI) reported its results for the fiscal fourth-quarter ending August 31, 2021, with revenue increasing 22% to $24.9 million, from $20.4 million in the same time period for 2020. Organigram said the increase was primarily due to an increase in adult-use recreational revenue, partly offset by the decrease in international revenue, medical revenue, wholesale revenue to other Licensed Producers, and a lower average net selling price. The stock was jumping over 10% in early trading on the results and was lately selling at $2.06.

The company also reported a net loss of $26.0 million, which was an improvement over last year’s net loss of $38.6 million. the company said this was largely due to the higher gross margin in the quarter which was partially offset by the impairment charges during the current quarter. The quarter also reported that the negative adjusted EBITDA decreased 48% from $9.2 million in the third fiscal quarter to $4.8 million. This improvement was primarily attributed to the increase in revenues and the improved adjusted gross margin.

“The results in Q4 Fiscal 2021 demonstrate the momentum we have achieved from our efforts to lead innovation and increase efficiencies. In the quarter, we introduced exciting new products that were embraced by consumers and we achieved higher crop yields at a lower cost” said Beena Goldenberg, Chief Executive Officer. “We are particularly pleased with our market share gains in the quarter to become a #4 LP and will build on these successes into Fiscal 2022.”

Looking Ahead

Organigram said it is forecasting its fiscal first quarter of 2022 revenue to be higher than the fourth quarter and attributed this to stronger forecasted market growth as COVID-19 restrictions continue to lift and the number of retail stores continues to grow; and the company is better able to fulfill the demand for its revitalized product portfolio with its increased production.

“Net revenue growth is expected from the company’s products as evidenced by Organigram’s growing national adult-use recreational retail market share (“market share”) from 5.4% in Q3 to 7% in Q4. As of October, the momentum continues and the company has reached a 7.9% share of market, maintaining its position as the #4 LP in Canada.”

“In addition, the resumption of shipments to Canndoc in Israel is expected to generate higher sequential revenue in Q1 Fiscal 2022 as compared to Q4 Fiscal 2021. The Company believes it is better equipped to fulfill demand in Q1 Fiscal 2022 with larger harvests expected as compared to Q4 Fiscal 2021. Revenues to date in Q1 Fiscal 2022 including a shipment to Canndoc that was in excess of $3.0 million, and purchase orders received from customers, support the Company’s expectation of revenue growth from Q4 Fiscal 2021 to Q1 Fiscal 2022; however actual results could vary from estimates from the date hereof until year-end.”

Organigram also expects to be positioned to generate more revenue growth from the production of soft chews and other edible products with the specialized equipment in the Winnipeg Facility under the direction of EIC leadership, who bring significant expertise in confectionery manufacturing.

Ms. Goldenberg concluded, “We are excited for what Fiscal 2022 holds for Organigram. Looking ahead, we expect to continue our momentum as we maintain our focus on increased points of distribution, bringing new, impactful, and innovative products such as Edison Jolts, SHRED, and SHRED’ems to market, and improve our ability to fulfill the growing demand for our products.”


Debra BorchardtJuly 13, 2021
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Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) released its results for the third quarter ending May 31, 2021, with revenue growing 31% over last year to $29.1 million. This was an increase of 51% from the second quarter. The net loss fell 96% to just $4 million from last year’s $89 million. The stock was trading higher by 6%  in early trading and was lately selling at $2.83.

Organigram attributed the increase in revenue to higher adult-use recreational net revenue and higher wholesale revenue (from other licensed producers) in the quarter. Last year’s third quarter adult-use recreational net revenue was reduced by a provision for product returns and pricing adjustments of $3.0 million (net of excise) of which the majority was largely due to slow-moving oil and certain flower products.

“We are pleased with the growth in revenue in Q3 as we were better staffed to fulfill the demand for our revitalized product portfolio, which continues to resonate well with consumers,” said Paolo De Luca, Chief Strategy Officer. “The ongoing investment in our genetics and cultivation program has yielded some exciting new dried flower products with more genetics and derivative product launches planned for the near term. Sales are trending higher to date in Q4 supported by a strong outlook for the industry as the number of cannabis retail stores continues to grow and existing stores are permitted to re-open their doors to customers.”

The cost of sales decreased from last year and this was primarily due to almost $30.0 million in inventory write-offs and provisions as well as charges related to a reduced workforce due to COVID-19 which were all incurred in the third quarter of 2020. SG&A increased over last year and Organigram said this was largely due to increased staffing and office costs related to the establishment of the CoE as well as the EIC acquisition, higher cultivation related research and development costs as well as higher audit fees (in connection with the company’s regulatory requirement to obtain an integrated audit opinion for the first time for its Fiscal 2021 annual financial statements).

Outlook

Organigram said it currently expects fourth-quarter 2021 revenue to be higher than the third quarter largely due to stronger forecasted market growth as COVID-19 restrictions lift (permitting cannabis retail stores to reopen to foot traffic) and the number of retail stores continuing to grow.  The company said it is better able to fulfill the demand for its revitalized product portfolio with increased staffing. In a statement, the company said,  “Revenues to date and purchase orders received from customers support the company’s expectation of revenue growth from Q3 2021 to Q4 2021; however actual results could vary from estimates from the date hereof until year-end. In addition, the company expects to generate a new and incremental revenue stream from the first sales of soft chews expected in Q4 2021.”

Solid Financials

On April 1, 2021, Organigram repaid all outstanding balances (approximately $58.5 million) under its credit agreement with BMO and a syndicate of lenders, which will result in annual interest savings of $2.7 million. Currently, the company has $222 million in cash and short-term investments (including restricted funds). Organigram believes it has sufficient cash and short-term investments to support its current plans, including the budget of $38 million for the completion of Phase 4C and the Moncton Campus design improvements, and to also support the corresponding growth to its working capital assets and still maintain sufficient liquidity and financial flexibility.


Debra BorchardtJune 25, 2021
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Organigram Holdings Inc. (TSX: OGI) (NASDAQ: OGI) announced after the market close on Thursday that it has filed a preliminary short form base shelf prospectus with the securities commissions in each of the provinces and territories of Canada. The Base Shelf Prospectus will allow Organigram to qualify the distribution of up to C$500 million of common shares, preferred shares, debt securities, subscription receipts, warrants, and units during the 25-month period that the Base Shelf Prospectus remains effective. Shares were falling slightly in early trading.

In May, Organigram announced that Greg Engel was stepping away from his role as CEO and director. Peter Amirault, current Board chairman, was appointed by the Board to serve as executive chair on an interim basis until a new permanent CEO was appointed.

In April, Organigram said it had repaid all outstanding balances (approximately $58.5 million) under its credit agreement with BMO and a syndicate of lenders which would result in annual interest savings of $2.7 million. At that time it had $232 million in cash and short-term investments.

The specific terms of any future offering of securities will ‎be established in a prospectus supplement filed with the applicable Canadian and US regulatory authorities. The Base Shelf Prospectus when final and effective will provide flexibility for financing options to pursue the company’s objectives. A corresponding shelf registration statement on Form F-10 has been filed with the United States Securities and Exchange Commission but is not yet effective.

In April, Organigram reported revenue for the second quarter ending February 28, 2021, fell 29% to $19.2 million from last year’s $27.3 million for the same time period.  The company attributed it to significantly lower wholesale revenue and lower average selling prices. The company said that last year’s better revenue was due to higher wholesale revenues that were opportunistic in nature and primarily to a single licensed producer.

The company went on to say that the net revenue was also lower due to missed sales opportunities, as certain employees tested positive for COVID-19 which resulted in a significant number of facility staff having to isolate. Organigram said it was unable to fulfill certain demands for its products totaling approximately $7 million in the quarter due to production and processing constraints. The revenue was also negatively impacted by certain provincial boards aiming to manage lower levels of inventory such as Alberta.

The net losses grew by 872% to $66 million from last year’s net loss of $6.8 million. The company said this was largely due to the negative change in the fair value of the derivative warrant liabilities and the negative gross margin in the second quarter.


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