Natural organic cannabis company Flora Growth Corp. (FLGC:NASDAQ), which cultivates all of its crops used in manufacturing its cannabis-derived products and brands outdoors, announced operating and (unaudited) financial results for the first half of 2021 ended June 30, 2021.
Flora Growth's President and CEO Luis Merchan commented, "Management believes each of our divisions gained significant traction relative to where we started the year as we execute on the strategic growth plan we laid out in December 2020, positioning shareholders for future success. At the end of last year, Flora was private, largely pre-revenue, and focused primarily in Latin America. During the past six months, Flora completed its IPO on the NASDAQ, while increasing its global distribution, revenue and expanding its premium portfolio of global cannabis brands and products."
The company reported that in H1/21 it generated total revenues of more than $2,000,000, compared to just $100,000 in 2020. The firm added that in H1/21 it achieved an (unaudited) gross profit of 60%.
Flora advised that it posted an (unaudited) net loss in H1/21 of $4 million but explained that this was largely due to the incurrence of one-time fees of approximately $3 million attributed to its initial public offering (IPO).
The firm listed that as of June 30, 2021, it held cash on its balance sheet of approximately $19 million with only minimal debt obligations. The company stated that following the close of H1/21, it has benefited from substantial cash inflows from warrants that were exercised. Flora stated that to date, it has received approximately $7.2 million from those warrants with more expected in the near-term.
The company advised that in Q2/21, it completed an IPO and succeeded in accomplishing a public listing under the ticker symbol "FLGC" on the Nasdaq Capital Markets exchange. The firm pointed out that by doing so it believes it is the first all-outdoor grower to be listed on the NASDAQ, as well as the first cannabis company to go public on an American exchange via a traditional IPO process.
The firm stated that this year it announced it plans to buy 100% of Koch & Gsell, which it said is "the manufacturer of the leading Swiss hemp and tobacco pre-roll brand Heimat." Flora added that in addition it executed a strategic investment of $2.4 million in Hoshi International, which is expected to promote distribution of Flora's products in the EU.
The company advised that it also set up the Flora Lab manufacturing division. The lab holds multiple GMP certifications and occupies a 16,000-square-foot manufacturing facility. The firm said this is where it makes its 190-plus products and 63 over-the-counter products, which are all licensed with Columbia's INVIMA (the equivalent of the U.S. FDA in that country).
The firm mentioned that so far in H2/21 it has achieved many other positive milestones. The company stated that its food beverage division, Kasa Wholefoods, signed a sales agreement with Tropi, Colombia's largest consumer packaged goods distributor, which has over 130,000 distribution points throughout 38 cities in Colombia. The first order from Tropi was about $1.1 million for the company's CBD and hemp products. Flora expects that future sales may reach as high as $2 million monthly.
The company noted that "its Flora Beauty division formally launched Ô ("Awe"), its premium brand and product line designed and marketed by founding partner, trend-setter, and global beauty influencer Paulina Vega."
Importantly, the company stated it intends to move its headquarters to Miami, Fla., by Q1/22.
Flora Growth described its business as "a cannabis company that leverages natural, cost-effective cultivation practices to supply cannabis derivatives to its diverse business divisions of cosmetics, hemp textiles, and food and beverage." The company has chosen to naturally cultivate all the crops used in its products outdoors. Flora mentioned that its goal is to market higher-quality premium products at lower than market prices.
Flora Growth Corp. has a market cap of around $370.2 million with approximately 42.0 million shares outstanding and a short interest of about 3.2%. FLGC shares opened 6% higher today at $9.35 (+$0.54, +6.13%) over yesterday's $8.81 closing price. The stock has traded today between $9.30 to $12.97 per share and closed at $12.68 (+$3.87, +43.93%).
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