Canadian cannabis provider Trees Corporation (NEO: TREE) continues to expand its retail footprint and reduce its debt load as it increases revenue projections.
Earlier this week, the company announced its first quarter financial results for the three months ended March 31.
The company generated revenue of $1.7 million during the first quarter compared to $0.5 million in Q1 2021, representing an increase of 225 per cent.
Revenue growth was driven by increasing retail operations.
Trees’ retail gross margin of 31 per cent in the first quarter was down from 36 per cent gross margin recorded during the prior year, reflecting increased price competition.
As at March 31, the company had a cash balance of $210,333 and a net working capital deficit of $3.7 million.
Trees has strengthened its balance sheet through debt settlement negotiations and a previously announced private placement financing.
“The Trees team has done an exceptional job in executing on our business plan,” Trees president and CFO Jeff Holmgren said in a statement.
“In recent months Trees has taken giant steps forward to strengthen the balance sheet through substantive debt settlements reducing corporate debt.”
Read more: Trees to acquire Camp Cannabis for $780K
In March, Trees acquired all the retail locations of Camp Cannabis, expanding its store footprint by approximately 40 per cent.
The company’s wholly owned indirect subsidiary, OCH Ontario Consulting Corp., made a deal to buy all the shares of Bernard Cann Ltd., doing business as Camp Cannabis.
Trees currently owns 11 stores in Canada, including seven in Ontario and four in British Columbia.