BioHarvest Sciences Inc. (CSE:BHSC, OTC:CNVCF) told investors it is targeting cash flow break even in late 2023 and profitability in early 2024 as it reported a strong increase in second-quarter revenue
Revenue for the company’s flagship VINIA product climbed 228% to $2.75 million in the three months to June 30, 2023, from a year earlier. It was up 27% from the March quarter.
The company recorded a 620% increase in total active subscribers by the end of June from a year earlier, noting that 85% of its current customer base are subscribers, with 95% of those on subscriptions of three months or more, and 26% being six months or more.
It said the increase in the number of both new customers and total subscribers demonstrates the power of a recurring revenue model that will enable it to accelerate revenue growth and achieve the scale required for profitability.
The focus during the first half of the year was on actions required to increase production capacity to meet the growing market demand for VINIA, BioHarvest said. While revenues are still constrained by production restraints, it said the measures undertaken so far this year and the imminent installation of recently acquired drying equipment point to achieving full factory capacity in early 2024.
Gross product margins increased to 40% from 12% in 2Q 2022 and the company said it expects them to improve further as production continues to scale.
"Our Q2 revenues demonstrate strong momentum that has continued into this current quarter,” CEO Ilan Sobel commented in a statement.
“The growth we are experiencing gets us closer to the scale required to build a healthy and profitable business. We are focused on achieving the production capacity that allows us to meet the growing demand for VINIA and for the introduction of new products.”
The company recorded a net loss of $2.85 million, or 0.6 cents per share.
It will hold a live shareholder presentation on September 6 at 2:30pm ET, including a discussion of the 2Q results and an update on new product initiatives.
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