Delivra Health Brands Inc. (TSX-V:DHB) this week reported strong year-end and quarterly results.
CEO Gord Davey joined Proactive to talk through the results, highlighting a 26% increase in net revenue and the positive impact this growth has on the company’s profitability.
Proactive: We are excited to share your year-end and quarter results, ending on June 30th. And we'll get into the numbers themselves in just a second because they are quite strong. But I think it's important to talk about the work that's been done over the last two, three, four years to get you to this point where you're starting to see these continual strong numbers.
Gord Davey: Yes, I think that's a really good point. To understand where we’ve come from as a company really sets us up for what the future has in store. Just three and a half, four years ago, our company was losing $15 million a year. Our margins were at 9%. Our customer base was falling, and our innovation was slowing down.
We made a commitment to the marketplace that we were going to put a strategic review in place, and that’s what we’ve done. We said we were going to get our finances back in order, which we have done. We said we were going to increase our customer base, which we have done. We said we would get our margins back into the right zone to be successful, and that's what we have done. So, it’s about the continuous improvement Delivra Health Brands has brought to the market, and that’s going to set us up for the future. Thanks for asking that at the beginning. I think it’s really important to understand.
Now we get into the numbers themselves. The company is seeing a 26% increase in net revenue—very positive. Why don’t you talk about the numbers that you're most happy with? That one just kind of jumps off the page.
When you come on and talk about positive numbers, that’s a great thing. But it’s about how we get to those numbers. Yes, a plus 26% in revenue is really important because it means our bottom line is increasing. But what’s also important is that our gross profit has gone up. So, our margins have actually increased to 52% from 49%. That means not only are we growing our product base, but we’re also doing it profitably. Our adjusted EBITDA has increased by over 68% year over year, which is huge for a company like us. This also puts us in a positive cash flow situation, meaning we are now very self-sustaining as a company. All of these things are crucial for the future of Delivra Health Brands.
You and I have talked over the last couple of months about what the future holds for the company and the things you're putting in place, including orders that are coming in, markets you're entering, and areas where you're looking to increase the company’s yield. So, it sounds like there’s a lot of positivity moving forward.
Well, I think the past shows us the opportunities for the future. That’s where Delivra Health Brands is right now. We are growing our customer base, we are investing in marketing and awareness programs, we are increasing our innovation, and we are now in a position to expand into other brands and services within the company. We’re also very focused on maintaining rigorous financial discipline. All of these factors set us up for a very strong future for Delivra Health Brands.
Lastly, what do you want to say to long-term shareholders who have been with the company and are now seeing what you’re seeing, especially given where the company has come from?
That’s exactly it. There is positive growth at Delivra Health Brands. What we said we were going to do, we have done, and we’re going to continue to do that. We are going to continue to grow our customers, continue to produce positive EBITDA, and continue to grow Delivra Health Brands in a positive and profitable way. We know that there’s much more to come.
Quotes have been lightly edited for clarity and style