Delivra Health Brands Inc. (TSX-V:DHB, OTCQB:DHBUF, FRA:3F0) said that it is preparing for a recovery in sales during the next quarter and fiscal 2027, as the company works to restore shipments to its Middle East distribution partners and expand its e-commerce business following a quarter impacted by geopolitical disruptions.
The company’s president and CEO Gord Davey said in a statement that management continues to monitor developments in the Middle East while maintaining close communication with local partners and planning future sales initiatives and product innovation efforts.
"Our results this quarter reflect the adverse impact of geopolitical developments on sales, and increase in costs of logistics and input material due to the impact of tariffs on our vendors," Davey said. "At the same time, we are encouraged by the strength of our core business fundamentals, and our e-commerce strategy continues to evolve and grow."
The company said sales were significantly affected by reduced shipments of its Dream Water products from the US to distribution partners in the Middle East. Delivra attributed the disruption primarily to ongoing regional conflict and the closure of the Strait of Hormuz, which affected product flow and sales during both the quarter and year-to-date period.
Delivra said it expects shipping and delivery activity to resume during the fourth quarter and fiscal 2027, supported by new order commitments and growth plans from international partners aimed at restoring sales levels.
Despite these challenges, Delivra reported continued growth in its direct-to-consumer channels. Dream Water Canada e-commerce sales increased 16% during the third quarter and 13% in the year-to-date, while LivRelief e-commerce sales rose 60% and 32%, respectively.
The company said those gains were partially offset by weaker retail performance. Dream Water Canada retail sales declined 15% in the quarter and 6% year-to-date, while LivRelief retail sales fell 30% and 27%, respectively.
Delivra also noted that it completed the transition of its licensed LivRelief Infused product lineup, which it said will support an updated distribution strategy. The company is continuing efforts to optimize sales channels and stabilize growth heading into fiscal 2027.
For fiscal Q3, the three months ended March 31, 2026, Delivra reported net revenue of $1.25 million, down from $3.1 million in the same period a year earlier. The decline was primarily driven by a $1.8 million reduction in Dream Water sales from the United States due to lower shipments to the Middle East.
Gross profit totaled $311,000, compared with $1.55 million a year earlier, while gross margin fell to 25% from 50%. The company attributed the decline to lower revenue, higher product costs, and changes in customer and product mix.