Company reports quarterly revenue of $3.8 million, up 112% year-over-year and 77% quarter-over-quarter
On track to complete business combination with Cansortium later this year, which will leverage RIV Capital's reported cash balance of $57.7 million to support growth across multi-state footprint
TORONTO, Aug. 28, 2024 /PRNewswire/ - RIV Capital Inc. ("RIV Capital" or the "Company") (CSE:RIV) (OTC:CNPOF), an acquisition and investment firm with a focus on building a leading multistate platform with one of the strongest portfolios of brands in key strategic U.S. markets, today released its financial results for the second quarter ended June 30, 2024 ("Q2 2024"). All financial information in this press release is reported in U.S. dollars unless otherwise indicated.
Management Commentary
"We are very pleased with the ongoing success of our adult-use operations rollout in New York through the second quarter," said Mike Totzke, COO and interim CEO of RIV Capital. "The customer response has been strong, reflecting the years of dedication and hard work from our team. Additionally, since the appointment of David Vautrin as Chief Retail Officer, we have enhanced our in-store retail shopping experience to best serve our growing cannabis community. We look forward to implementing these strategies further with the expected opening of two additional adult-use retail locations in New York later in 2024."
Mr. Totzke added, "Since announcing our strategic business combination with Cansortium, we have begun the important work to align our two companies and ensure we are prepared to hit the ground running upon successful completion of the transaction. Cansortium's best practices and standard operating procedures have been implemented at our New York operations to boost our operational efficiency and elevate quality standards. There are also plans to rapidly introduce Fluent's brands into the New York market to expand our consumer reach and further bolster national brand recognition. With all that lies ahead, we are incredibly excited about the remainder of 2024 and the promising future of our combined company."
Regulatory Update
The Company is pleased to note that New York state continues to actively advance its efforts to combat ongoing illicit market activities. At the federal level, the Company continues to monitor developments regarding the rescheduling of cannabis from a Schedule I to a Schedule III substance under the Controlled Substances Act (the "CSA"), as rescheduling is anticipated to lead to the removal of 280E taxes and provide support for further potential federal reform. This potential change may expand institutional access to invest in the cannabis sector and accelerate opportunities for research into the medical benefits of cannabis.
Financial Results for the Second Quarter Ended June 30, 2024
The following is a summary of the Company's unaudited financial results for the three and six months ended June 30, 2024 and 2023. As previously announced, the Company has changed its fiscal year end from March 31 to December 31. Accordingly, the comparative period presented for the six months ended June 30, 2023, had not previously been reported in historical unaudited condensed interim consolidated financial statements published by the Company. Further details regarding the change in fiscal year end, including the length and ending dates of the Company's financial reporting periods, are available in the Company's Notice of Change in Year End prepared in accordance with Section 4.8 of National Instrument 48-102 and filed on the Company's SEDAR+ profile at www.sedarplus.ca.
Unless otherwise indicated, all financial highlights summarized in tables in this press release are presented in thousands of dollars, except share and per share amounts. All references to "$" are to United States dollars.
Summary Operating Results
Three months ended
Jun. 30, 2024
(unaudited)
Three months ended
Jun. 30, 2023
(unaudited)
Six months ended
Jun. 30, 2024
(unaudited)
Six months ended
Jun. 30, 2023
(unaudited)
Revenue, net
$ 3,789
$ 1,786
$ 5,927
$ 3,514
Cost of goods sold
4,945
1,591
6,834
3,187
Gross profit excluding fair value items
(1,156)
195
(907)
327
Unrealized gain (loss) on changes in fair value of biological assets
(431)
197
(78)
279
Realized fair value amounts included in inventory sold
22
1
33
(1)
Gross profit
(1,565)
393
(952)
605
Selling, general, and administrative expenses
5,831
5,306
12,030
10,638
Operating loss
(7,396)
(4,913)
(12,982)
(10,033)
Other loss
(2,580)
(4,289)
