Organigram Holdings Inc. (TSX VENTURE: OGI) (OTCQB: OGRMF), the parent company of Organigram Inc., a leading licensed producer of medical marijuana based in Moncton, New Brunswick, is pleased to announce its financial results for the three and nine-months ended May 31, 2018.
“Our fiscal third quarter was transformational for the Company. Our production capabilities have increased exponentially, we launched our adult recreational brand strategy and have signed agreements with a number of provinces and private retailers as well as announcing key significant investments from both a strategic and international perspective. As we head into the launch of the adult use recreational market we believe Organigram is well positioned to build upon its domestic medical business into becoming a national player in the adult recreational market and a global player in the medical market.”
- Organigram began harvesting from its Phase 2 expansion facility (23 grow rooms) on April 20, 2018 bringing its target production of dried flower equivalent to 22,000 kg/annum;
- In May the Company launched its adult recreational brand strategy which included house brands such as The Edison Cannabis Company, ANKR Organics and Trailer Park Buds;
- In May Organigram received a “License for Controlled Drugs and Substances” from Health Canada making the Company a Licensed Dealer;
- In May the Company received its “Permit to Export Cannabis” license which allowed Organigram the ability to make its first international medical shipment to Australia (completed in July);
- Shortly after quarter-end the Company began use of its Phase 3 expansion filling six of the 16 grow rooms with the remaining rooms filled in June and July bringing its target production of dried flower equivalent to 36,000 kg/annum; and
- Announced strategic investments in: Hyasynth Biologicals, Alpha-Cannabis Germany, and Eviana (see previous press releases for more details) which all are expected to close in the calendar third quarter.
- Record net sales for both the three-months and nine-months ended May 31, 2018 of $3.7 million and $10.1 millionrespectively vs. $1.9 million and $3.6 million respectively for 2017;
- Record sale volume of cannabis oil for the three-months ended May 31, 2018 (768,400 milliliters) up 39% from Q2/18 (552,250) and up 452% from Q3/17 (139,200 milliliters);
- Record sales volume of dried flower (303,428 grams) for the three-months ended up 28% from Q2/18 (237,650 grams) and up 55% from Q3/17 (196,129 grams);
- Record yields per plant in the quarter ended May 31, 2018 (see MD&A for further details);
- Cost of cultivation per gram of dried flower harvested of $0.80 per gram “all-in” (direct labour and materials, allocated overhead and depreciation) and $0.58/gram excluding depreciation. Note that cost of cultivation is a non-GAAP measure used by management internally and does not include indirect production, packaging or shipping costs (see financial statements and MD&A for further details);
- Registered medical patients climbed to a record 15,316 by the end of Q3 up 18% since Q2 (12,957);
- Impairment of goodwill on its 2017 acquisition of Trauma Healing Centres in the amount of $1.2 million related to “right sizing” of the business opportunity;
- Net interest expense of $3.7 million for the quarter primarily attributable to the interest expense on $115 million of convertible debentures issued on January 31, 2018; and
- Net income of $2.8 million, an increase of 162% compared to $1.1 million in Q2-2018 and a loss of $2.3 million in Q3-2017.
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