Second Quarter 2021 Results - Consolidated revenue of $11.82 million increased 32% compared to Q1-2021
- Paid down over $30 million in debt during the quarter
- Continued growth targeted in the second half of the year
TORONTO, Aug. 11, 2021 /CNW/ - The Green Organic Dutchman Holdings Ltd. (the "Company" or "TGOD") (TSX: TGOD) (US: TGODF), a leading producer of premium certified organically grown cannabis, reports its unaudited interim financial results for the quarter ended June 30, 2021. These filings are available for review on the Company's SEDAR profile at www.sedar.com.
Management Commentary:
"Growth continued in the second quarter as the organization remained focused on executing our turnaround plan and fulfilling the TGOD Promise. Our premium flower SKUs performed strongly and our mainstream portfolio under the Highly Dutch brand also contributed to the quarter's sales growth which together, lead to our highest quarterly revenue to date," commented Sean Bovingdon, TGOD's CEO and interim CFO. "We continued our transformation with our strategic asset monetization initiatives such as the sale of our Quebec Facility in Valleyfield, which allowed us to eliminate our senior term debt while maintaining operations at the site through a lease agreement with the purchaser. Benefiting from a stronger balance sheet and lower operating costs out of the Quebec Facility, TGOD is well positioned for continued expansion."
Second Quarter 2021 Financial Highlights:
- Earned quarterly consolidated revenues of $11.82 million in Q2-2021 compared to $8.98 million in Q1-2021, representing a quarter-over-quarter increase of 32%. Sales from cannabis products in Canada of $10.4 million for Q2-2021 and hemp-derived product sales in Europe of $1.42 million for Q2-2021. European revenues were affected by the impact of COVID-19 on distribution channels. Sales levels in Europe are expected to normalize towards the end of the year.
- Canadian sales grew 55% quarter-over-quarter as Highly Dutch Amsterdam Sativa gained traction and as the COVID-19 lockdown restrictions began to ease. Experienced a gross profit (before changes in fair value of biological assets) of $3.27 million compared to $1.34 million in the previous quarter, and of $0.99 million in Q4-2020. This positive result is primarily driven by the year over year improvement of $2.87 million in the Company's gross profit before changes in biological assets. The Company's cash return on each sale has improved as the efficiencies of scale are being realized at the Hamilton Facility as the fixed costs are being absorbed at higher rates, in line with Company expectations.
- Continued to focus on costs with G&A expenses remaining relatively flat compared to the prior year at $5.74 million despite the Company experiencing additional professional expenses and costs related to the annual meeting in Q2-2021. TGOD expects G&A expenses to normalize in line with Q1-2021 levels for the remainder of 2021.
- Sales and marketing expenses of $1.34 million for the quarter decreased in comparison to expenses of $2.24 million for the same period in 2020 primarily due to strategic partnership payments being paid on a new set of performance indicators. Personnel costs related to sales and marketing are expected to slightly increase through the rest of the year with the addition of the Chief Growth Officer. The Company also expects to invest an additional $0.5 million into strategic partnerships to continue to drive retail sales and build recurring business with chains, where possible.
- Registered a net loss of $32.48 million for the quarter comprised primarily of the loss on the assets held for sale (Quebec Facility) of $17.69 million and a loss from operations of $9.08 million. However, the cash used in operating activities was only $5.8 million in comparison to $8.29 million for the same period in the prior year. The Company expects to achieve positive monthly operating cash flow before the end of 2021.
https://www.newswire.ca/news-releases/the-green-organic-dutchman-reports-second-quarter-2021-results-816514829.html