Rubicon Organics Q3 Revenue Grows 124% YoY To $5.7M, Reaches Adjusted EBITDA Profitability In Sep. For The First Time

Rubicon Organics Inc. ROMJ ROMJF reported its financial results Wednesday for the third quarter ended September 30, 2021, with net revenue of CA$7.1 million ($5.7 million), up by 124% from the same period of 2020.

The cannabis company, based in Vancouver, British Columbia, noted that revenue growth is attributable to increased product offerings under its flagship Simply BareTM Organic brand and the rollout of 1964 Supply CoTM and Homestead Cannabis Supply into large provinces.

Q3 Financial Summary 

• Adjusted EBITDA was a loss of CA$600,000 compared to an adjusted EBITDA loss of CA$2.6 million in the same quarter year ago; Net loss amounted to CA$3.8 million, versus a net loss of $4.3 million in the same period of 2020; 
• Gross profit before fair value adjustment was $1.8 million, or a gross margin of 25%;
• The company had its highest-ever revenue month in September 2021 and delivered Adjusted EBITDA profitability for the first time in that month.

 “Our record net revenue this quarter is a strong validation of our strategy to create an innovative portfolio of branded products, rooted in the production of high-quality organic cannabis,” Jesse McConnell, CEO Rubicon Organics stated. “We can now also demonstrate that our lean manufacturing processes and financial discipline are able to generate significant contribution margin. With our brand portfolio, we have developed channels to utilize all of our production and we remain steadfast in our goal of driving industry-leading profitability.”

Q3 2021 Operational Update

• Simply BareTM Organic currently ranks as the #1 premium brand and #1 organic brand by sales of flower and pre-roll products across Canada for the year-to-date period ending September 30, 2021 and represents 8.3% market share of the premium flower and pre-roll category for the 12 months ended October 31, 2021.
• For Q3 2021, the company achieved its highest total market share since inception in the flower and pre-roll category, increasing to 1.9% across Canada, up from 1.7% in Q2 2021. This is attributable to steadily rising sales of Simply BareTM Organic, the launch of 1964 Supply CoTM in Ontario, British Columbia and Alberta and the launch of Homestead Cannabis Supply in British Columbia and Alberta. Subsequent to Q3 2021, for the three months ended October 31st, the Company increased its market share to 2.2%.

Highlights Subsequent to Q3 2021:

• Signed a Cannabis Products Supplier Agreement with Medical Cannabis by Shoppers Drug Mart Inc.
• Homestead Cannabis Supply landed in Ontario retail stores for the first time.

Outlook

The company’s current expectation is Adjusted EBITDA profitability and to be operating cash flow positive in 2022. 

Price Action

Rubicon Organic’s shares closed Tuesday market session 1.49% higher at $2.04 per share. 

Photo: Courtesy of CRYSTALWEED cannabis on Unsplash