Halo Labs Inc (OTCMKTS:AGEEF) posted revenues of $4.449 million in Q1 2020. However, its revenues improved by 66.7% compared to Q4 2019. ANM Inc contributed significant revenues of $3.963 million. The company’s other business segments comprise HLO Ventures, Coastal Harvest LLC, and MDT (Mendo Distribution and Transportation LLC).
Causes of revenue decline in Q1
Halo Labs closed down CA-based bulk distillate operations to preserve the cash balance because of challenging marketing conditions posed by the vape crisis. Ongoing coronavirus crisis also caused a reduction in operating capacity during this quarter. The company is offering home delivery adhering to government regulations.
Nevada’s businesses suffered a drop of 36.7% in the regulated cannabis market during the first four months of this year. Halo Labs took prudent decision to minimize the operations in HLO and Coastal Harvest amid challenging marketing conditions.
Highlights in Q1
Halo Labs promoted Katharyn M. Field as a President from CSO on February 12, 2020. The company took over MDT on January 9, 2020. It exercised the option of MDT to buy OGC (Outer Galactic Chocolates LLC) and expects to complete this transaction in Q3 2020.
Halo Labs signed a purchase accord on February 14, 2020, with High Tide and its affiliates. As per the terms of the deal, the company will acquire five development permits, three retail cannabis stores, digital assets, and copyrights of High Tide.
Halo Labs acquired a software company – Cannalift, on March 10, 2020, to consider 31 million common shares. Cannalift develops an application that facilitates a convenient and new technique to get cannabis products. The new application facilitates the delivery of products to consumers from local dispensaries.
Halo Labs signed pacts on March 5, 2020, to clinch a controlling stake in a North Hollywood Cannabis Dispensary – LKJ11, LLC. It will also take over Crimson & Black, LLC, a retail manager of LKJ11. Halo Labs will issue common shares worth $2 million to LKJ11 on closing the deal.
An update on edibles
Halo Labs generated sales of $44 million (up 3%) from ingestible in California in April 2020. The company’s sales from ingestible in Oregon is $12.5 million. It is an increase of 18% YoY.