Adam JacksonOrganigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) reported its second quarter results ending March 31, with a 262% rise in net loss and a net revenue of $37.6 million falling 5% from the same period last year.
However, the company’s recreational net revenue grew by 21% to $33.1 million versus $27.4 million in the second quarter of 2023.
Organigram posted a net loss of $27.1 million for the quarter, a sizable rise from the $7.5 million net loss in the same period last year, primarily due to lower unrealized gains on changes in the fair value of biological assets and derivative liabilities.
Organigram also reported an adjusted EBITDA loss of $1 million in the second quarter of fiscal 2024, versus a positive adjusted EBITDA of $5.6 million in the same quarter last year, also mostly due to lower international sales.
“We are pleased with our performance against the strategic priorities we laid out at the beginning of fiscal 2024,” CEO Beena Goldenberg said in a statement.
Organigram closed its first tranche of a private placement with British American Tobacco (BAT), adding $41.5 million in cash and bringing its closing cash balance to $83.6 million at the end of the quarter. After the period’s end, the company closed a $28.8 million oversubscribed marketed offering, which, combined with the remaining two anticipated BAT investment tranches, is expected to raise its cash position by an additional $110 million.
The company invested in Steady State LLC (aka Open Book Extracts), its first foray into the U.S. market via its Jupiter investment pool, which includes Phylos Bioscience Inc.
Organigram believes its U.S.-based investments will benefit from potential rescheduling.
Organigram said it held number one position in milled flower, hash, ingestible extracts, and pure CBD gummies in Canada. The SHRED brand surpassed $200 million in annual retail sales. The company also completed its first international flower shipments to Germany and the U.K., and signed two new international supply agreements in Australia and the U.K.
Organigram and BAT are looking to develop new technologies in the edible, vape, and beverage categories, as well as new inhalation formats. The company is preparing to deliver new products in these spaces, it said, with a launch priority on gummies featuring a new nano-emulsion technology.
Looking ahead, Organigram expects international revenue to continue growing while lower cultivation costs, achieved in the second quarter, begin to positively impact its income statement in the third quarter.
“As we head into the second half of our fiscal year, we are on track to deliver full-year adjusted EBITDA that will exceed that of fiscal 2023 and positive cash flow from operations before working capital changes,” CFO Greg Guyatt said.
