Adastra Holdings (CSE:XTRX) Ltd reported its third-quarter results that highlighted strong revenue and a much-improved balance sheet compared to the same period last year thanks to increased production of its distillate and shatter products.
For the three months period ended September 30, 2021, the cannabis company reported revenue of $1.8 million, compared to $826,000 in the same quarter a year earlier.
Adastra said that it had increased distillate production by 275 kilograms, or 86%, compared to the corresponding quarter last year, and shatter production increased 52 kilograms in 3Q compared to last year.
READ: Adastra Holdings generates record shipments in September on rising demand
This helped to boost the company to a gross profit of approximately $934,000 for the quarter.
Sequentially, Adastra increased its revenue by 46% compared to 2Q 2021, when it reported around $1.2 million in revenue.
Other highlights from the balance sheet included a significant decrease in net loss to $208,000, compared to $3.9 million in the year-ago quarter, and down from the $546,000 it reported in 2Q 2021. Gross margins expanded to 52% from 44% over the same sequential period.
Michael Forbes, Adastra’s CEO, commended the team’s work in restructuring and reducing costs.
“We are hitting our stride in the 4Q, positioning us for rapid growth and positive cash flow in the upcoming quarter. We have a large national sales footprint that we are leveraging into new products, particularly infused pre-rolls, which we believe we can quickly turn newly introduced products into high revenue generators.”
Forbes added that he is “confident” that sales will reach $5 million in monthly sales by the end of 2022, citing an 18% increase in sales to provinces, including 107% growth in Ontario, and the entrance during the quarter into Yukon, its sixth province.
Founded in 2018 and formerly known as Phyto Extractions, Adastra manufactures and supplies ethnobotanical and cannabis science products designed for the adult–use and medical markets and forward–looking therapeutic applications. The firm is known for its line of Phyto Extractions branded cannabis concentrate products available on shelves at over 1,400 adult–use retailers across the country. In addition, its Adastra Labs is a 13,500 square-foot agricultural-scale Health Canada licensed facility located in Langley, British Columbia, focused on extraction, distillation, and manufacturing of cannabis–derived products.
The company ended the quarter with a little over $1.2 million in cash.
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