The Supreme Cannabis Company Inc. (OTCMKTS:SPRWF) has announced its operating and financial results for the quarter and twelve months ended June 30, 2020. In the fourth quarter, the company’s recreational sales revenue was up 27% QoQ and 373% YoY thanks to the launch of cannabis 2.0 products.
Recreational cannabis sales volumes up 10% QoQ
Beena Goldenberg, the company’s CEO stated that fiscal 2020 was a vital transitional year for the company in which it streamlined its operations, expanded its brands and products portfolio, and reorganized its team to drive revenue growth. He said that going into 2021. Supreme Cannabis’s focus will be on efficiency across the company as the company moves towards becoming a cannabis CPG company.
In the fourth quarter, despite the pandemic resulting in store closure and reduced foot traffic the company still managed to generate net recreational revenue of $7.3 million. Recreation sales volumes were up 10% QoQ to 1,449 kg at an average selling price per gram of $5. The increase was mainly due to the company’s strategic focus on the recreational business as the main source of revenue. Wholesale net revenue dropped 43% in Q3 2020to $2.3 million which was due to suppressed wholesale cannabis flower demand and low average wholesale cannabis sales selling prices.
Supreme cannabis strengthened its balance sheet
At the end of the quarter, the company had $28.4 million in cash and cash equivalents. Supreme Cannabis announced in Q4 2020 the establishment of an at-the-market (ATM) equity program allowing it to issue and sell common shares for up to $9.75 million. The ATM program will offer more financial flexibility going forwards. Also, the company refinanced its convertible debentures and amended its Credit facility thus reducing its total debt by $69.8 million.
In Q4 2020 7ACRES’s premium dried flower contributed to a bigger percentage of the company’s recreational sales. Blissco almost doubled net sales and shipments in the quarter and the company will introduce the full-spectrum CBD 510 vaporizer cartridge in fiscal 2021. The sugarleaf brand has grown into nine SKUs following its launch in Q2 2020.