GARDEN GROVE, CA / ACCESSWIRE / July 9, 2019 / KushCo Holdings, Inc. (OTCQX: KSHB) ("KushCo" or the "Company"), today reported financial results for its third fiscal quarter ended May 31, 2019.
Third Fiscal Quarter 2019 Financial Summary
- Net revenue increased 221% year-over-year to $41.5 million, compared to the same quarter a year ago and 17.9% on a sequential basis versus the second fiscal quarter of 2019.
- On a GAAP basis, gross profit increased to 17.8%, compared to 12.9% during the second fiscal quarter of 2019.
- On a Non-GAAP basis, excluding the impact of certain non-recurring items, gross profit was approximately 22.8%.
- On a GAAP basis, net loss was approximately $10.6 million, compared to a net loss of approximately $9.2 million during the third quarter of fiscal 2018. Loss per share improved from negative $0.14 during the third quarter of fiscal 2018 to negative $0.12 during the third quarter of fiscal 2019.
- On a Non-GAAP basis, excluding the impact of certain non-recurring charges and gains, net loss during the third quarter was $8.6 million and net loss per share was negative $0.10.
- Cash was approximately $12.2 million as of May 31, 2019, compared to approximately $13.5 million as of August 31, 2018.
Third Fiscal Quarter Operational Summary
- Launched first biodegradable packaging solution through contract with SunGrown
- Completed warehouse management system implementation
- Secured $21.3 million in senior unsecured note
- Signed exclusive development and distribution agreement with IEKO to produce biodegradable and compostable plastics portfolio
Nick Kovacevich, Chairman and Chief Executive Officer, commented, "Revenue for the third fiscal quarter of 2019 saw strong growth of 221% year-over-year, reaching a record $41.5 million, compared with $12.9 million in the third fiscal quarter of 2018 and $35.2 million in the second fiscal quarter of 2019. More importantly, we saw gross margins move up ~490bps on a GAAP basis quarter over quarter which is a testament to our commitment of profitable and sustainable growth over time."
"The Company's organic revenue growth and overall performance were attributable to the growth of our customer base and effective cross-selling of our offerings."
– Nick Kovacevich, Chairman and Chief Executive Officer of KushCo
"We remain committed to investing in the expansion of the business through initiatives targeting high-demand, high-margin opportunities that will facilitate increased cross-selling throughout our robust customer base. Partnerships will help us achieve those revenue and margin goals, including our recently announced deal with CA Fortune, which opens an entirely new vertical that will facilitate access to a distribution network unlike anything ever experienced by the cannabis and hemp industries before. We continue to evaluate accretive business opportunities and anticipate more partnerships coming online soon that service our vast network and power the cannabis ecosystem," continued Mr. Kovacevich.
"We expect demand to increase for the Company's core product offerings as the cannabis and hemp markets continue to expand and mature. Our customer base is gaining strength with the largest multi-state operators and Canadian LP's starting to scale in existing markets, while also preparing for growth in new emerging geographies – including recently approved Illinois. We remain committed to building out the Company's core competencies as we increase efficiency at a larger scale and strategically adding new verticals that will further establish KushCo as a major player in the cannabis and hemp industries," concluded Mr. Kovacevich.
About KushCo Holdings, Inc.
KushCo Holdings, Inc. (OTCQX: KSHB) is the premier producer of ancillary products and services to the cannabis and hemp industries. KushCo Holdings' subsidiaries and brands provide product quality, exceptional customer service, compliance knowledge and a local presence in serving its diverse customer base.
Founded in 2010, KushCo Holdings has now sold more than 1 billion units to growers, processors and producers across North America, South America, and Europe.
The Company has been featured in media nationwide, including CNBC, Los Angeles Times, TheStreet.com, Entrepreneur, and Inc. Magazine. While KushCo Holdings provides products and solutions to customers in the cannabis and CBD industries, it has no direct involvement with the cannabis plant or any products that contain THC or CBD.