All figures in USD unless stated otherwise
- Revenue of
$6.9 million , net of inter-company eliminations, down 24.8% compared to$9.1 million in Q2 2021. Revenue was impacted by a significant downturn in both theCalifornia andOregon markets. - Total sales were 2.0 million grams, a 59.4% decrease compared to 5.0 million grams in Q2 2021. Flower sales decreased by 6.2% to 1.1 million grams compared to 1.2 million grams in Q2 2021, sales of pre-rolls increased by 11.5% to 257,245 grams compared to 230,655 grams in Q2 2021, no trim and fresh frozen sales, oils and extract sales decreased by 68.3% to 597,088 grams compared to 1.9 million grams in Q2 2021, and edibles sales decreased by 88.8% to 24,820 grams compared to 221,134 grams in Q2 2021.
- The Company reported a gross profit of
$2.1 million , or 31.9% gross margin, compared to gross profit of$2.2 million , or 24.1% gross margin, in Q2 2021. - Adjusted EBITDA[1] loss of
$4.1 million compared to an Adjusted EBITDA loss of$4.4 million in Q2 2021. - The Company repaid
$7.7 million in debt financing and raised$8.0 million from convertible debentures. - As of
June 30, 2022 , the Company had unrestricted cash available in the amount of$1.6 million . - In
California , Halo has decided not to build outUkiah Ventures and has sold the land associated with it. The sale of the land closed onJune 30, 2022 , resulting in a reduction of debt of$1.53 million , yielding net proceeds of approximately$588,000 including a seller note secured against the property for$400,000 . - Halo received regulatory approval to open three Budega™ brand retail dispensaries in
Los Angeles, California . The first location opened inNorth Hollywood onMarch 14, 2022 , followed by a store inWestwood , which opened onMay 27, 2022 . Halo plans to open its flagship store inHollywood in the latter half of 2022. These stores will increase distribution and market awareness of Halo's proprietary brands and products inCalifornia .
On
"The important work of defining the next phase of Halo's evolution is well underway, as we leverage our strong positioning on the
"During the quarter, we ramped up efforts in our brand sales business, specifically Hush and Budega which are resonating with
"Our efforts to do more with less are already paying off. In the second quarter, we maintained steady gross margins despite the downward pressure on wholesale pricing and volumes across our markets. We have also made progress reducing Halo's indebtedness through debt paydowns."
Concluded
Revenue
Q2 2022 revenues were
Total Q2 2022 sales were 2.0 million grams compared to sales of 5.0 million grams in Q2 2021, a 59.4% decrease. Between Q2 2022 and Q2 2021 Flower sales decreased by 6.2%, sales of pre-rolls increased by 11.5%, oils and extract sales decreased by 68.3% and edibles sales decreased by 88.8%.
Gross Profit
The Company reported a gross profit of
Liquidity and Cash Balance
As of
Complete results are reported in the Company's consolidated financial statements for the three and six months ended
Halo is focused on the
In the non-THC sector, Halo is expanding into health and wellness categories, including CBD and functional supplements such as nootropic nutraceuticals and non-psychotropic mushrooms. Halo, through a series of acquisitions, has product offerings in the form of beverages (H2C Beverages), dissolvable strips (Dissolve Medical), capsules (Hushrooms™), and topical supplements (Hatshe) with proposed national distribution via a strategic agreement with
Halo has successfully acquired and integrated a variety of companies which were subsequently reorganized to create Akanda Corp. (NASDAQ: AKAN), an international medical cannabis and wellness company, of which Halo currently owns 12,674,957 common shares worth approximately
For further information regarding Halo, see Halo's disclosure documents on SEDAR at www.sedar.com.
Connect with
Adjusted EBITDA is a non-IFRS financial measure that the Company uses to assess its operating performance and does not have any standardized meaning prescribed by IFRS. Management defines Adjusted EBITDA as earnings (loss) before interest, tax, depreciation, and amortization, as adjusted for non-cash items. Adjusted EBITDA is provided to assist management and investors in determining the Company's operating performance. The Company also believes that securities analysts, investors, and other interested parties frequently use Adjusted EBITDA in the evaluation of companies, many of which present similar metrics when reporting their results. As other companies may calculate Adjusted EBITDA differently than the Company, Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. We caution readers that Adjusted EBITDA should not be substituted for determining net loss as an indicator of operating results, or as a substitute for cash flows from operating and investing activities. For a reconciliation of Adjusted EBITDA, please refer to "Non-IFRS Measures" in the Q2 2022 MD&A, which is available on the Company's SEDAR profile at www.sedar.com.
This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". Forward-looking information may relate to anticipated events or results including, but not limited to the Company's plans regarding its flagship dispensary in
By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: inability of management to successfully integrate the operations of acquired businesses, changes in the consumer market for cannabis products, changes in the expected outcomes of the proposed changes to Halo's operations, the proposed spin-out with
The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
This press release includes trademarks, such as "Budega", "Hush", "
[1] See "Non-IFRS Financial Measures". |
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