Vext Science, Inc. (CSE: VEXT) (OTCQX: VEXTF) had a decent 2022 in Arizona despite challenging economic conditions caused by high inflation rates. The MSO reported its financial results for the period ending December 31, 2022.
Vext reported revenue of $35.4 million and made $15.1 million in adjusted EBITDA, a 12.8% increase from the previous year. Net income was $10.9 million, double from $4.9 million at the end of 2021, according to company filings. Earnings were eight cents a share, versus four cents a share in 2021.
CEO Eric Offenberger in a statement expressed his satisfaction with the company’s performance in the face of a “challenging consumer environment that emerged, particularly during the second half of 2022.” He praised his team for executing on the company’s business objectives, launching targeted promotions to drive traffic, and finding consistent efficiencies.
The Arizona market sales were flat for 2022, but the company held its own with revenue of $8.2 million in the fourth quarter. Vext expects the underlying effects of the challenging economic conditions to persist through at least mid-2023.
While the company expects continued results from its Arizona operations, it sees Ohio as an ideal emerging market to plant stakes. Other multistate operators such as Ayr Wellness have made the similar choices to look the buckeye state for growth.
Vext recently paid $12.5 million to acquire Appalachian Pharm Processing and its subsidiaries, which will allow it to become a fully vertically integrated entity in Ohio, with a tier one cultivation facility, a manufacturing facility, and retail stores.
The company also received approval for 17,0000 square feet of cultivation space in Eloy, which it plans to begin using in the second quarter of 2023, with a first harvest estimated in the third quarter.
Additionally, Vext’s joint venture partner, APP, achieved its first harvest out of its tier one cultivation facility in Jackson, Ohio, on February 21, 2023.
“With its significantly larger population, steady growth in patient count and potential for future adult-use transition, we expect Ohio to propel growth for Vext, contributing meaningfully towards revenue, profitability and cash flow over the next few years as we continue to focus on building value for our shareholders,” Offenberger said.