Canadian Cannabis Producer Cannara Biotech Reports Profitable Quarter

MONTREAL–Cannara Biotech, a prominent cannabis producer based in Montreal, has unveiled a notable achievement, reporting a profit of 2.9 million Canadian dollars ($2.2 million) in the recently concluded third quarter that terminated in May, as detailed in its latest financial disclosures.

This figure signifies a remarkable upswing, with net income for this quarter surpassing the mark by 107% compared to the same period in 2022. In the prior year, Cannara Biotech had recorded a profit of CA$1.4 million, an achievement that now pales in comparison, according to a press release.

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Delving further into measures of profitability, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter soared to a positive CA$3.9 million. This robust financial standing extends over the course of the company’s initial three fiscal quarters, culminating in a cumulative adjusted EBITDA of CA$8.6 million.

The momentum carried into Cannara Biotech’s net sales, which experienced a notable surge. The period from March to May in 2023 saw a significant uptick of 57% in net sales, reaching CA$15.9 million when juxtaposed against the corresponding three-month span in 2022.

The cumulative net revenue for the first nine months of fiscal 2023 reflected a substantial leap, totaling CA$39.3 million. This increase of 63% over the parallel nine-month duration from the previous year underscores the company’s resounding success.

A telling indicator of financial viability is free cash flow, the surplus remaining after discharging operating expenses and capital expenditures. In this regard, the third quarter yielded impressive results, with free cash flow surging to CA$3.2 million – a marked enhancement of 113% over the corresponding figure of CA$1.5 million recorded in the third quarter of 2022.

Zohar Krivorot, the CEO of Cannara Biotech, expressed his enthusiasm regarding these achievements, emphasizing the company’s market growth in key provinces. “This past quarter was a tremendous success as Cannara grew its market share by more than 30% in Quebec and in Ontario, along with growing sales in (British Columbia) and the commencement of sales in a new market, Alberta, the second largest cannabis market in Canada,” Krivorot stated.

Noteworthy advancements in market share underscore the company’s ascendance. In Quebec, Cannara Biotech’s market share escalated to 9.3%, a marked surge from the preceding figure of 7%. Similarly, in Ontario – Canada’s largest cannabis market – the company established a solid foothold, commanding a market share of 2.7%.

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Cannara Biotech has also focused on bolstering its operational infrastructure, boosting its employee count by a substantial 29%. As of May 2023, the company’s workforce comprised 270 dedicated individuals, a testament to its commitment to operational growth.

On the financial front, Cannara Biotech closed the quarter with a cash reserve of CA$4 million, solidifying its financial stability and future prospects.

Trading under the ticker symbol LOVE on the Toronto Venture Exchange, Cannara Biotech’s accomplishments highlight a dynamic landscape marked by both financial prowess and market expansion.