The Valens Company (TSE:VLNS) (OTCQX:VLNCF) (FRA:7LV) has reported a 44% increase in its fiscal 2020 net revenue to $83.8 million, as the company’s Cannabis 2.0 market share in Alberta, British Columbia, and Ontario increased to approximately 4.9% in the fourth quarter according to Headset data.
Valens also said its provincial sales grew 292% quarter over quarter in 4Q, transforming the company into the largest third-party cannabis product manufacturer in Canada.
In the results statement, Tyler Robson, chief executive officer, co-founder and chair of The Valens Company commented: "In fiscal year 2020, we transformed Valens from a leading extraction company into the industry's most trusted third-party manufacturer of cannabis consumer packaged goods. Over the course of the year, we strategically employed our human and capital resources to strengthen our platform and build the infrastructure required to offer what we believe are the most innovative and cost-competitive product manufacturing capabilities in the market today."
READ: Valens scales up and begins to show what it was 'made to do'
He added: “Moving into 2021 with a transformed business model, a growing international presence, and over 77,000 square feet of manufacturing space, Valens is focused on three key initiatives – growing unit volumes per SKU, increasing Cannabis 2.0 and 3.0 product market share, and driving revenues in new consumer verticals.”
“We expect to do this by expanding our provincial distribution capabilities, entering new international markets including the US, and broadening our custom manufacturing and white label partnership network.”
As well, the company noted that it has cemented its position as the largest third-party vape manufacturer in Canada.
Valens also announced that its adjusted EBITDA for the year fell to $14.1 million from $27.5 million in 2019, impacted by the company's previously announced strategic inventory realignment and an increase in operating expenses as it continues to scale its operations and build out its manufacturing platform.
In addition, Valens reiterated its previously-announced revenue guidance for 1Q 2021 of between $19 million to $23 million, while outlining strategic initiatives for the year that include:
- Enter the US and other international markets via strategic partnerships and acquisitions;
- Utilize data-driven expertise gained as a category leader in vape manufacturing to expand its leadership in new verticals, such as edibles, concentrates, beverages and 3.0 products;
- Expand domestic distribution network beyond Alberta, British Columbia, Ontario, and Saskatchewan to all provincial markets, including near-term entry to Manitoba and Quebec; and
- Gain Canadian recreational market share with brand & consumer package good partners with the launch of new products for the Cannabis 2.0 and 3.0 markets, including edible and topical products targeted for the health and wellness market.
Contact Sean at sean@proactiveinvestors.com