Aleafia Health Q3 Net Revenue Grows 23% YoY, Lays Off 20% Of Employees

Aleafia Health Inc. ALEAF AH released its financial results for the three months ended December 31, 2022, revealing net revenue of CA$10.8 million ($8 million), a 23% increase compared to CA$8.8 million in the Q3 2022.

Q3 2023 Financial Highlights

• Gross loss was CA$13.3 million, compared to gross loss of CA$21.6 million in Q3 2022.

• Net loss and comprehensive loss was CA$25.1 million compared to CA$71.5 million in Q3 the 2022.

• Adjusted EBITDA was CA$446,000 compared to adjusted EBITDA loss of CA$2.4 million.

Adjusted SG&A of CA$3.8 million in the quarter ended December 31, 2022 represented a 51% decline over the prior year and a 16% decline relative to last quarter. Since the last quarter, the company achieved an additional CA$2.8 million in annualized adjusted SG&A cost savings primarily relating to efficiencies in its IT systems, enhanced procurement processes, and an ongoing vendor consolidation. The company’s full-time equivalent headcount decreased by 20% over last quarter. Over the last four quarters, over CA$16 million in annualized cost savings have been extracted from adjusted SG&A, bringing adjusted SG&A down from 89% of total net revenue in the quarter ended December 31, 2021 to 36% in the quarter ended December 31, 2022.

“Aleafia Health has developed a relentlessly focused cost containment and profitability culture, while continuing to introduce highly innovative, sought-after and in-demand products while adding to adult-use revenues nationally in Canada,” stated Aleafia Health CEO Tricia Symmes. “With ongoing and completed cost rationalizations and the continued growth and popularity of our branded adult-use portfolio, anchored by Divvy, we remain confident the company can reach our goals of scalable profitability while attaining a top 10 standing in our markets in the next fiscal year.”

“International net revenue for the 2022 calendar year was CA$1.7 million up from CA$0.7 million in the prior year, an impressive 155% increase,” added Symmes. “While there was a modest decline in international revenue quarter over quarter due to timing of shipments, product is now in the European market and with the completion of expansion plans, the company’s Paris, Ontario indoor cultivation facility will increase grow capacity by 20% for international destinations.”

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