Income for Indiva limited (TSXV: NDVA) (OTCQX: NDVAF) continues to be primarily derived from edibles like Wana Sour Gummies and Bhang Chocolate.
On Tuesday, the Ontario-based company released its financial report for the second quarter of this year along with a list of highlights and notable operational events.
The presentation of the new consumer brand Indiva Life at the Lift&Co 2022 show is an example of this. The first products marketed under the new brand will include extracts and edibles.
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Indiva’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) saw sequential improvement in the second quarter, losing just $150,000 from a loss of $380,000 in the first quarter and down a year on the other compared to the profit margin of $490,000 generated in Q2 last year.
The company says the drop was related to lower revenue and high marketing expenses offset by lower cost of goods.
Year-to-date adjusted EBITDA showed a much larger loss of $530,000 compared to the $10,000 lost in the second quarter of 2021.
The company reported gross revenue of $8.9 million in the second quarter, down 8.1% from the prior quarter.
Operating expenses for the quarter were flat at $3.45 million due to lower general and administrative expenses, which decreased 18.8% year-on-year and 6.1% sequentially.
Year-to-date, the company’s net revenue increased 12% year-over-year to $17 million, a new record.
Indiva is a Canadian company that distributes vapes, edibles, flowers, capsules and extracts through its brands INDIVA, Artisan Batch and Indiva Life.
Operational highlights for the company included receiving a Best in Grow award from Cannabis New Brunswick (NB) for best indica flower, launching new stock keeping units (SKUs) including Wana Passion gummies Fruit and Shine Clementine and the signing of a five-year licensing and manufacturing agreement with Dime Industries for the production of vaporizers.
The company expects net revenue to be higher sequentially in the third and fourth quarters, primarily due to the introduction of new products, including Dime Industries vapes, Pearls gummies and other Indiva Life branded products that make their entry into the market.
“We are very pleased to report record net sales and gross profit on a yearly basis, and expect further revenue growth in the second half of 2022, driven by the introduction of over 25 new SKUs across Canada,” said Niel MarottaPresident and CEO of Indiva.
“The second quarter was extremely busy operationally as we started manufacturing new products, including our first commercial batches of Pearls gummies, which were delivered to OCS after the end of the quarter. ‘ship pearls and many other new products to other provinces over the next few weeks,’ he added.
“We are pleased to see an improvement in gross margins in the quarter, but in line with our June 27, 2022 press release, delays in deliveries of new products and the absence of provincial delivery appointments in some provinces at the end of June caused approximately $1 million sales to slip in Q3 2022, leading to lower year-over-year net revenue.