Organigram has reported a 25% year-on-year increase in revenues over its third quarter as sales in its home market rebounded.
In the three months to June 30, 2024, the Canadian cannabis operator reported net revenues of $41.1m compared to $32.8m in the same period a year earlier.
This was also a 9% sequential increase from the previous quarter ($37.6m), which it attributed largely to increased sales in the Canadian recreational sales, driven by an increased market share in Quebec and New Brunswick, alongside the introduction of 18 new SKUs, including a range of infused pre-rolls.
The company’s gross margin improved substantially, rising to $14.6 million, or 36% of net revenue, up from $6.1 million, or 19%, in the same period last year.
This improvement is attributed to reduced cultivation and post-harvest costs, lower inventory provisions, and increased operational efficiency. Additionally, the company reported an adjusted EBITDA of $3.5 million, a significant improvement from a loss of $2.9 million in the prior year.
In the previous quarter, Organigram attributed its decline in profitability to poorer performance in its international markets, but it says strategic investments overseas have played a crucial role in its performance this quarter.
The company made its first significant European investment by acquiring a minority stake in Germany’s Sanity Group as part of its efforts to expand its presence in the European market.
This investment, along with new international supply agreements in Australia and the UK, underscores Organigram’s commitment to global expansion and diversification, it said in its results.
Looking ahead, Organigram is well-positioned for future growth, with a strong balance sheet boasting a pro-forma cash position of approximately $173 million. The company plans to increase seed-based production and continue its focus on high-margin products, further solidifying its market position both in Canada and internationally.
“We are pleased to report a strong third quarter, highlighted by a 25% year-over-year increase in net revenue, and a significant improvement in adjusted EBITDA”, said Beena Goldenberg, Chief Executive Officer…
“Furthermore, the preliminary results from our landmark PK study on our latest patent pending nanoemulsion technology demonstrate our ongoing commitment to innovation and expanding our product offerings.”
