The previous year saw cannabis companies all across the spectrum see impressive growth figures, with sales often doubling, tripling, or quadrupling. This trend is still well poised to continue throughout 2019 as the cannabis market, especially within Canada, remains young enough that exponential growth will remain the norm for a while yet.
Harvest One Cannabis Inc (TSXV: HVT)(OTCMKTS: HRVOF) is one example of this, with the company reporting their Q2 2019 financial results which, among other things, showed a 123 percent increase in revenue.
The Vancouver-based company announced the release of their three- and six-month financial results ending on December 31st, 2018. Most impressively, the company had a 123 percent increase in net revenue, ending the year at $3.7 million.
This increase is mainly represented by the initial recreational load-ins from dispensaries where the company has supply agreements in place (Ontario, Manitoba, Saskatchewan, and British Columbia). Gross profit margins have increased as well, sitting at an impressive 53 percent which is comparable to most major cannabis companies profit margins.
Harvest One falls in the category of the many Canadian junior cannabis producers that were hit hardest by the Q4 turbulence in the market at the time. Staying relatively out of the news, the company’s investors have been hoping for stock prices to return to their previous highs, something that this announcement will help accomplish.
“We are delighted to announce our second successive quarter of record growth for Harvest One with an increase of 123% in revenue over the previous quarter. These results reflect a successful roll out of our recreational strategy as we continue to deliver on our agreements with all our provincial and private partners,” said CEO Grant Froese. “As we focus on operational excellence and execute on our strategy across all our divisions, we will continue to drive revenue growth for Harvest One throughout 2019.”
Unlike most other junior cannabis producers in Canada, Harvest One is different in that a large portion of its revenues come from abroad. Around 44 percent of this came from the U.S. market, alongside a small amount coming from Ireland of all places. Other companies’ announcements include the fact that it has a strong cash balance of $41 million, which will likely be used to expand or acquire other junior cannabis companies. Harvest One also has an agreement with Valens GroWorks to help it produce derivative CBD-oil products.
In response to the news, shares of Harvest One surged 17.5 percent overnight before ending the day at a respectable 4.8 percent increase. Overall, the company’s stock has been declining throughout February while most cannabis companies have seen their share prices increase throughout the month.
Harvest One Cannabis Company Profile
Harvest One is a global cannabis company that develops and provides innovative lifestyle and wellness products to consumers and patients in regulated markets around the world. The Company’s range of lifestyle solutions is designed to enhance quality of life. Shareholders have significant exposure to the entire cannabis value chain through its wholly-owned subsidiaries; United Greeneries, a Licensed Producer; Satipharm (medical and nutraceutical); and Dream Water Global (consumer); and a minority interest in Burb Cannabis (retail operations). – Harvest One