After the market closed on Thursday, IM Cannabis Corp. (CSE: IMCC) (NASDAQ: IMCC)reported financial results for the first quarter ending March 31, 2022 as revenues increased 169% year-over-year to $23.6 million. IMCC said that total dried flower sold in the quarter was 3,035kg at an average selling price of $6.23 per gram, compared to 1,185kg for the same period in 2021 at an average selling price of $4.94 per gram, derived mainly from the higher average selling price per gram the company recognized through its acquired pharmacies in Israel.
IMCC also delivered a net loss of $10.7 million in the quarter versus net income of $4.7 million for the same time period in 2021. Basic and diluted loss per share in Q1 2022 of $0.14 and $0.17, respectively, compared to basic and diluted income (loss) per share in Q1 2021 of $0.11 and ($0.06), respectively.
“We continue to progress well on our path to profitability and achieved another quarter of record revenues, which grew 169% year-over-year in the first quarter,” said Oren Shuster, Chief Executive Officer of IMC. “We execute key initiatives that drive margin expansion within each of our market segments and across our operating footprint, which reflect the benefits of integrating our global model. In Israel, we work to consolidate four of the country’s leading pharmacies and centralize our distribution and customer support to potentially create significant cost savings while strengthening our brand presence. We also increasingly leverage yield from our Canadian cultivation facilities for our products imported to and sold in Israel, which exhibit a gross margin profile that is nearly double that of products sourced from suppliers.”
While the company didn’t give a numerical forecast for the second quarter it did say that it continues to experience meaningful growth across its global platform, primarily in Israel and Canada, reflecting the continued execution of the company’s strategy, its accelerating international brand presence, its focus on cultivating premium flower, and its global distribution and supply chain model. On a preliminary, unaudited basis, IMC said it expects second quarter revenue and gross margin to increase sequentially.
“In Canada, our WAGNERS and Highland Grow brands have achieved market share leadership due to our relentless focus on delivering upon consumer expectations, with each brand holding a top three ranking in Ontario within their price segments. As we increase internal cultivation toward full capacity, we also focus on key operational initiatives to improve yield and reduce volume-based costs. These initiatives will help us reach positive Adjusted EBITDA, which we expect to achieve on a run rate basis in the second quarter of 2022, positioning us to be cash flow positive on a run rate basis in the following quarter.”
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