Auxly Reports Q1 2021 Financial Results
TORONTO, May 28, 2021 (GLOBE NEWSWIRE) --
Auxly Cannabis Group Inc. (TSX - XLY) (OTCQX: CBWTF) ("Auxly" or the "Company") today released its financial results for the three months ended March 31, 2021. These filings and additional information regarding Auxly are available for review on SEDAR at www.sedar.com.
Q1 2021 Highlights and Subsequent Events
-- Recorded net revenues of $10M for the three months ended March 31, 2021, an increase of 1% from the same period in 2020. -- Maintained leadership position in Cannabis 2.0 product sales with approximately 12.6% national market share1 in the quarter. -- SG&A declined another 5% from the previous quarter. -- Continued to launch new innovative products to the Canadian market with the introduction of the Company's first cannabis concentrate, 232 Series Diamonds under its Kolab Project brand and an industry-leading, high-potency topical, Dosecann Daily Relief CBD cream. -- Welcomed Andrea Fraser to the Auxly Family as Chief People Officer. -- Further strengthened the Company's balance sheet with a $8M private placement offering of units. Revenue For the three months ended March 31, 2021, cannabis revenues were $12.2 million as compared to $10.5 million in the same period in 2020. Net cannabis revenues of $9.2 million during the period, were comprised of approximately 80% Cannabis 2.0 Products sales, with the remainder from Cannabis 1.0 Product sales. During the first quarter of 2021, Auxly maintained strong retail cannabis sales nationally. While Auxly's cannabis revenues were impacted by additional volatility as a result of changes to its provincial customers' inventory management practices and the increase in restrictions during the third wave of the COVID-19 pandemic, the Company was able to maintain leading market share positions for retail cannabis sales. Research and other revenues of $0.8 million for 2021 were $0.1 million lower than 2020 primarily as a result of the COVID-19 pandemic and its disruptive impact on the completion of clinical trials and the achievement of revenue milestones connected to such clinical trials. Revenues in support of third-party research contracts can fluctuate significantly during the term of the contract based upon the achievement of milestones. Where milestones are not met, revenues are deferred on the balance sheet which may result in timing differences in earnings. Gross Profit / Loss Auxly realized a gross profit of $2.3 million to March 31, 2021, compared to a gross profit of $2.8 million in 2020. Cannabis gross profits for the period ended March 31, 2021 were $2.3 million, resulting in a 26% margin (25% before impairment and fair value adjustments), with research and other gross profits of $nil. Inventory impairment of $0.2 million was recognized in 2021, as compared to a $1.3 million loss during the same period of 2020 associated with Inverell's operations.