MediPharm Labs Corp. (TSX: LABS) (OTCQX: MEDIF) (FSE: MLZ)’s revenue went down for its first quarter in 2022 but says its recent investments would pave the way for a profitable second quarter.
On Monday, the cannabinoid firm released its first-quarter financial statements ending March 31 and reported a 14 per cent revenue decrease to $4.9 million from $5.7 million in the last quarter of 2021.
It reported a 66 per cent decrease in net loss of $7.5 million from $21.9 million in the last quarter and adjusted earnings before interest, taxes, depreciation of negative $5.6 million from a negative $6.6 million in the previous quarter.
Medipharm also reported $28.3 million in cash by the end of the quarter.
During the quarter, the company entered the United States market with a Food and Drug Administration (FDA) Drug Master File to process CBD. It also received authorization from the Brazilian Health Regulatory Agency Anvisa to start selling its products to medical patients.
In March, the company acquired Shelter Cannabis which added dried flower and pre-rolls to its portfolio. It also completed deliveries of its first CBG products in ingestible oil and vapes.
The company says it is debt-free and has full ownership of its assets.
CFO Greg Hunter said that the period was slow and the company expects it will improve throughout the second quarter and its recent investments in sales and marketing resources begin to pay off.
“The brands we acquired as part of our acquisition of Shelter Cannabis’ IP portfolio and that we are now manufacturing out of our Barrie facility, began shipping in May and will contribute to revenue beginning in Q2,” said CFO Greg Hunter.
Company stock went up by 12.50 per cent on Monday to $0.09 on the Toronto Securities Exchange.
Read more: Medipharm Labs acquires Shelter Cannabis brands
Read more: MediPharm Labs to enter US pharmaceutical market via FDA drug registration
MediPharm Labs CEO David Pidduck, who joined the company mid-April, said the company has already opened sales channels into key markets which will deliver growth and ROI.
“In the current environment, I also expect to see an expansion in the M&A opportunity set as weaker players come under growing pressure.”
“With a strong balance sheet, world-class facilities with spare capacity, and expanding sales force and a toehold in key global markets, MediPharm is well-positioned to leverage a prudent M&A strategy into accretive growth.
