Auxly Reports 20% YoY Revenue Decline, CA$174.2 Million In Debt

Auxly Cannabis Group Inc. XLY CBWTF released Monday its financial results for the three and six months ended June 30, 2023, revealing quarterly revenue of CA$22.0 million ($16.35 million) down by 8% sequentially and 20% year-over-year.

“We have successfully consolidated our dried flower and pre-roll cannabis product manufacturing, processing and distribution activities, which was a key strategic goal for this year,” Hugo Alves, CEO of Auxly stated. “While the transition had a temporary impact on the sales and financial performance during the quarter, we have already observed a positive impact of increased product throughput and improved product quality as a result of this consolidation. This is a part of a broader strategy to ensure Auxly can remain competitive against a backdrop of continued price compression and disproportionate taxation in the adult use recreational market. We believe that Auxly is well-positioned to compete in the current value-price driven environment given our brand portfolio, Auxly Leamington's cost structure and the automation investments we have made to our manufacturing processes.”

Q2 2023 Highlights

• Adjusted EBITDA was a loss of CA$1.1 million, an improvement of CA$2.9 million as compared to the same period last year.
• Net loss was CA$12.86 million, versus a net loss of CA$14.29 million in the same period of 2022.
• Gross profit was of CA$6.1 million, resulting in gross profit margin of 28%, compared to CA$9.8 million and 36% in second quarter of the prior year, respectively.
• Selling, general and administrative expenses declined by CA$1.3 million or 13% from the previous quarter and CA$4.1 million or 32% from the same period in 2022.
• As of June 30, Auxly held CA$8.56 million in cash and equivalents, CA$316,890 in assets, and had CA$174,201 million in debt.

Price Action

Auxly shares closed Friday market session 2.58% lower at $01.043 per share.

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Photo: Courtesy of RDNE Stock project