Zinger Key Points
- Lowell Farms navigates a financial downturn, with net revenue falling sharply to $6.2 million in Q3 2023.
- Despite revenue challenges, the company reports strides in debt reduction and strategic brand advancement.
- Key segments like Consumer Packaged Goods face steep declines, signaling a shift in market dynamics.
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Lowell Farms Inc LOWLF, a vertically integrated cannabis company, reported its Q3 earnings for the period ending September 30, 2023. The California-based company announced a net revenue of $6.2 million, marking a 28% decrease from the $8.7 million reported in the same period last year.
Q3 2023 Financial Highlights
- Net revenue generated for Q3 2023 decreased 28% to $6.2 million, as compared to $8.7 million for Q3 2022.
- Net loss was $20.2 million compared to the $4.8 million reported in Q3 2022.
- Adjusted EBITDA reported a loss of $1.3 million, albeit an improvement from the negative $3.5 million in Q3 2022
- Gross profit revealed a loss of $444 million.
Management’s Optimism Amidst Financial Turbulence
Ann Lawrence, chairperson of Lowell Farms' board, remains optimistic. "One year into our ambitious restructuring strategy, the decisions we're making have enabled us to eliminate millions in debt, and secured rights to advance the Lowell brand, positioning ourselves for growth and success."
Segment Performance And Financial Health
This decline in revenue represents a further 12% decrease from the second quarter of 2023. The company’s Consumer Packaged Goods (CPG) segment saw a 29% drop compared to Q3 2022, and its bulk revenue from self-grown wholesale products plummeted by 39% in the same comparison.
The company’s gross margin turned negative at -7.1%, translating to a gross loss of $0.4 million. This is a decline from Q2 2023’s gross margin of -4.8% and a gross profit of $0.3 million. Operating losses showed a relative improvement, being reported at $2.8 million, a 46% betterment from the $5.2 million loss in Q3 2022.
LOWLF Price Action
LOWLF's shares were trading 11.01% lower at $0.24 per share at the time of this writing around 3:30 PM ET Tuesday.
Related News
- California Cannabis Co. Pays Off Debt, Here’s What’s Next
- Lowell Farms Announces Share Consolidation
Photo by Ryan Lange on Unsplash
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