Highlights from the third quarter include:
- Q3 revenue rose 29% from Q2 to CAD$$9.3 million
- Q3 pro forma revenue rose 23% from Q2 to CAD$27 million
- Q3 gross profit of CAD$4.6 million (up 41% from Q2)
- Gross margin increased from 45% to 49% in Q3
- Net income of CAD$0.4 million
SLANG ended Q3 with cash and cash equivalents of CAD$10.6 million. This prompted management to seek to raise an additional CAD$15 million with its new public offering. The financing is expected to close immediately.
In operations, SLANG reported the sale of 913,000 branded units in Q3. Sales were distributed across 12 U.S. states, through 2,600+ cannabis retailers. SLANG’s O.penVAPE product line maintained its market-leading position across Colorado, New Mexico and Vermont.
SLANG entered the growing Florida medicinal cannabis market in July. Its RESERVE line vaporizer cartridges are now for sale via its partnership with Trulieve Cannabis Corp. The Company continued to progress in adding additional product lines and integrating previous acquisitions.
On the bottom line, Q3 net income of CAD$0.4 million was a decline from the CAD$17.5 million reported in Q2. However, the second quarter result was aided by large balance sheet adjustments. Management is targeting positive operating cash flow by mid-2020.
SLANG also announced an investment in Q3 by former Canopy Growth CEO, Bruce Linton.
Going forward, SLANG intends to continue building on concentrate/vaporizer portfolio and its cannabis edibles product lines. SLANG also intends to begin building its consumer reach in dried flower products.
The Company plans to commence partnerships in 2020 with Green House Seed Company, Strain Hunters, and Cookies. These partners were selected on the basis of the strength and recognition of their cannabis flower brands.
Despite the generally favorable results, SLANG is currently trading down 10.20% today to CAD$0.44.