Adastra Holdings (CSE:XTRX) Ltd has announced record results for its second quarter and the first half ended June 30, 2022, and noted that momentum is accelerating in the second half of the year.
Gross profit jumped 226% to $1.09 million in the three months to end-June, up from $340,000 in Q2 2021, on Q2 gross revenues up 146% year-on-year to $3.05 million, demonstrating “significant” demand for the company's cannabis concentrate brands and products.
Gross revenues in the year to date surged 192% to $5.34 million, the company added.
"Adastra experienced a record-breaking first half of the year, demonstrating growth and gaining strong momentum as we continued to execute on our transformational strategy," said Michael Forbes, chief executive officer of Adastra in the results statement.
READ: Adastra expands its market footprint with Medical Sales License from Health Canada
"Building on our first-quarter achievements, we are once again reporting record revenues and gross profit levels in Q2 2022. In the first six months alone, our gross revenues are close to what we achieved for the entire 12 months last year. We are excited for the future of our business and the industry as a whole. We are seeing an increase in demand for our products as we continue to gain market share, and we are finding every opportunity to streamline our operations and add new revenue streams," added Forbes.
"Together, with the support of our co-manufacturing partners, we look to leverage our innovation and unique capabilities for sustained profitable growth, with the aim to create long-term value for our customers, partners and shareholders," he concluded.
The company launched its Endgame Extracts brand in British Columbia (BC) in the first quarter of this year. It said its shatter and vape products rank in the top 10 as per Headset data, while its Phyto Extractions shatter brand ranks in top five best-sellers in BC as per Headset Data.
Shatter production increased to 185.4 kg in Q2 2022 from 106.6 kg in Q1 2022 and 61.4 kg in Q2 2021.
Meanwhile, demand increased for both business-to-business (B2B) and business-to-consumer (B2C) sales in the second quarter, Adastra noted.
A total of 208,626 kg of distillate was produced in June 2022, it added.
The company received medical sales license approval from Health Canada earlier this month, enabling it to distribute patient-formulated products to the medical market.
It expects automated pre-roll equipment for infused pre-roll production to be installed and operational in September 2022.
Adastra is a leading manufacturer and supplier of innovative ethnobotanical and cannabis science products designed for the adult use, medical markets and forward-looking therapeutic applications.
The company acquired 100% of the legacy-built brand Phyto Extractions in September 2021. The brand is well-known for its cannabis concentrate products, available on shelves at over 1,400 adult-use retailers across the country.
The company also operates Adastra Labs, a 13,500 square foot agricultural-scale Health Canada licensed facility located in Langley, BC, focused on extraction, distillation, and manufacturing of cannabis-derived products.
Adastra has successfully taken steps in becoming a licensed cultivator, tester, extractor, and seller of controlled substances, including psilocybin and psilocin, by applying for a Controlled Substances Dealer's License, which is under review by Health Canada.
Pending Health Canada approval, Adastra is poised to be a drug formulation and development leader in this emerging sector.
Through the acquisition of PerceiveMD, Adastra operates a multidisciplinary manufacturer for medical cannabis and psychedelic therapies.
Contact the author at jon.hopkins@proactiveinvestors.com