StateHouse Holdings Inc. STHZF STHZ released its financial results for the three-month period ended March 31, 2023, revealing net revenue of $24.7 million, an increase of 42.8% compared with $17.3 million in Q1 2022.
Q1 2023 Highlights
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Gross profit was $11 million compared to $6.5 million in Q1 2022.
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Gross margin was 44.3%, compared to 31.9% for Q1 2022.
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Net loss was $10.9 million, compared to $10.6 million in Q1 2022.
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Cash and restricted cash at the end of the period was $2.6 million.
“We're off to a fantastic start in 2023,” stated Ed Schmults, CEO of StateHouse. “Our focus remains on driving unparalleled customer satisfaction and loyalty through innovative product offerings and one of the most valuable customer loyalty programs in the industry. We truly understand the value-conscious mindset of today’s consumers and are excited to bring initiatives that will benefit them, such as the TOPS loyalty program and our brand-new line of Liquid Diamond Infused Pre-Rolls. These pocket-friendly packs of three come at an incredibly consumer-friendly price, further enhancing our commitment to delivering exceptional value.”
Operations Update
During Q1, the company reduced operating expenses from the prior quarter by approximately $12.0 million annualized. These reductions have been achieved through a comprehensive evaluation of company operations, including process improvements, outsourcing of distribution, upgraded and consolidated technology, and the elimination of redundant operations and service providers. Management reduced headcount an additional 16% from January 1, 2023 to May 30, 2023. Management is also exploring the potential sale of various non-core assets, which is expected to generate approximately $1-3 million of non-dilutive capital to strengthen its balance sheet and fund its growth objectives.
Based on improvements in the business and what has been achieved to date, the company expects to generate positive adjusted EBITDA and to begin generating positive cash flow before the end of 2023.
Photo by Tim Foster on Unsplash .
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