AUXLY REACHES NEW FINANCIAL MILESTONES IN RECORD-BREAKING Q3 2024 AND GROWS OVERALL NATIONAL MARKET SHARE
TORONTO, Nov. 8, 2024 /PRNewswire/ - Auxly Cannabis Group Inc. (TSX:XLY) (OTCQB:CBWTF) ("Auxly" or the "Company") a leading consumer packaged goods company in the cannabis products market, today released its financial results for the three and nine months ended September 30, 2024. These filings and additional information regarding Auxly are available for review on SEDAR+ at www.sedarplus.ca.
Q3 2024 Highlights and Subsequent Events
The Company continues to outperform, delivering another record-breaking quarter of financial results across key metrics of revenue, margin and adjusted EBITDA;
Established a new all-time record in net revenues of $33.3 million, an increase of 18% year-over-year and 14% quarter-over-quarter;
Set a new all-time record in Gross Margin on Finished Cannabis Inventory Sold1 of 47% in the quarter, an improvement of 17% year-over-year;
SG&A continued to remain substantially flat quarter-over-quarter, with a notable 16% decrease year-over-year;
Fifth consecutive quarter of positive adjusted EBITDA1, achieving a new all-time record of $8.3 million, representing a 60% quarter-over-quarter increase and a remarkable 6,982% increase compared to the same period in 2023;
Net income of $3.2 million and cash flow provided by operating activities of $12.9 million;
The Company continued to make improvements to its balance sheet by reducing its debt1, by 54% compared to the end of 2023, including repaying the outstanding principal on the Company's standby financing facility;
The Company saw improvements in its overall national market share, moving into the #4 LP position in national recreational sales for the quarter2;
Market leadership in the all-in-one vape category, securing over 36% of the total market share in the category and 50% of the top 10 vape SKU positions nationally;
Back Forty's Liquid Imagination 28g SKU continued to win with consumers, ending the quarter as the #1 selling flower nationally;
The Company's pre-roll product suite saw a 19% increase in national sales compared to the previous quarter with Back Forty's Wedding Pie and Banana OG, securing the #3 and #4 position respectively, in national non-infused pre-roll sales for the quarter.
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1 Non-IFRS or Supplementary financial measure. Refer to the Non-GAAP Measures section in the MD&A for definitions.
2 Hifyre IQ as of October 23, 2024.
FINANCIAL HIGHLIGHTS AND KEY PERFORMANCE INDICATORS
For the three months ended:
(000's)
September 30,
2024
September 30, 2023
Change
% Change
Net revenues
$ 33,284
$ 28,211
$ 5,073
18 %
Gross margin on finished cannabis inventory sold*
15,559
8,593
6,966
81 %
Gross margin on finished cannabis inventory sold (%)*
47 %
30 %
17 %
57 %
Net income/(loss)
3,239
32,621
(29,382)
-90 %
Adjusted EBITDA*
8,286
117
8,169
6,982 %
Weighted Average Shares outstanding - basic
1,265,144,208
1,002,068,656
263,075,552
26 %
For the nine months ended:
(000's)
September 30,
2024
September 30, 2023
Change
% Change
Net revenues
$ 87,703
$ 74,169
$ 13,534
18 %
Gross margin on finished cannabis inventory sold*
37,177
23,491
13,686
58 %
Gross margin on finished cannabis inventory sold (%)*
42 %
32 %
10 %
31 %
Net income/(loss)
(20,771)
9,509
(30,280)
-318 %
Adjusted EBITDA*
15,699
(823)
16,522
2,008 %
Weighted Average Shares outstanding - basic
1,177,818,866
986,208,447
191,610,419
19 %
As at:(000's)
September 30,
2024
December 31, 2023
Change
% Change
Cash and equivalents
$ 18,957
$ 15,608
$ 3,349
21 %
Total assets
264,224
261,904
2,320
1 %
Debt
57,259
123,579
(66,320)
-54 %
*Non-IFRS or supplementary financial measure. Refer to the Non-GAAP Measures section in the MD&A for definitions
Hugo Alves, CEO of Auxly, commented: "Our continued focus on efficient revenue growth and enhanced profitability has delivered another record-breaking quarter of financial results, highlighted by an 18% year-over-year increase in net revenue and record adjusted EBITDA of $8.3 million. Our commitment to providing consumers with exceptional products that help them live happier lives enabled us to grow national market share in our core product categories of dried flower, pre-rolls and vapes; and has elevated Back Forty to the #1 brand in Ontario by dollars sold. We remain focused on creating long-term shareholder value. I am excited for the future and proud of the tremendous efforts of our talented and dedicated team in delivering these results."
RESULTS OF OPERATIONS
For the periods ended:
Three months September 30,
Nine months September 30,
(000's)
2024
2023
2024
2023
Revenue
Revenue from sales of cannabis products
Excise taxes
$ 50,994
$ 39,910
$ 132,784
$ 111,968
(17,710)
(11,699)
(45,081)
(37,799)
Total Net Revenues
33,284
28,211
87,703
74,169
Cost of Sales
Costs of finished cannabis inventory sold
Inventory impairment
17,725
674
19,618
3,233
50,526
1,603
50,678
5,365
Gross profit/(loss) excluding fair value items
14,885
5,360
35,574
18,126
Unrealized fair value gain/(loss) on biological transformation
Realized fair value gain/(loss) on inventory
9,964
(7,703)
4,766
(5,538)
21,554
(14,602)
13,726
(13,323)
Gross Profit
17,146
4,588
42,526
18,529
Expenses
Selling, general, and administrative expenses
Equity-based compensation
Depreciation and amortization
Interest and accretion expenses
8,457
1,324
