Decibel Cannabis Company Inc., a market leader in premium cannabis and extract manufactured products, is pleased to announce its unaudited interim financial results for the three month period ending March 31, 2024.
“Despite the drop in revenue, we remain one of Canada’s top brands by market share. With a focused effort on our strategy, we expect an improved Q2 and more importantly a continued path to sustainable growth and profitability. I am currently undergoing a comprehensive business review and I look forward to sharing the initiatives undertaken before July 15th.” said Benjamin Sze, Decibel’s Chief Executive Officer.
First Quarter Highlights
- National Market Share(1) of 6.0% in Q1 2024, which placed Decibel as the 4th largest licensed producer in Canada by market share.
- Net Revenue was $21.0 million in the first quarter of 2024, with year over year decrease of 16%. Net revenue decrease driven by increased competition in the infused pre-roll segment, vape consumers switching towards large format 510 cartridges and disposables and the halting of exports to Israel as the Company transitioned to a new distribution partner. Subsequent to quarter end, Decibel has launched large format 510 cartridges and disposables.
- Gross Margin Before Fair Value Adjustments was 48% in the first quarter of 2024, compared to 51% in the first quarter of 2023.
- Adjusted EBITDA(2) of $3.6 million in the first quarter of 2024, with a year over year decline of 45% over the first quarter of 2023. The decrease in Adjusted EBITDA quarter over quarter was primarily driven by a decline in net Canadian recreational sales and international sales and the reclassification of retail financial contributions to discontinued operations, partially offset by a decrease in SG&A.
- Positive Free Cash Flow(2) of $375 thousand in the first quarter of 2024, with a sequential decrease of 79% over the first quarter of 2023.
- Adjusted Net Loss(2) of $3.5 million in the first quarter of 2024, with a decline of $6.8 million over the first quarter of 2023. Adjusted Net Income was negatively impacted by a $3.3 million impairment on the Prairie Record’s assets held for sale during the first quarter of 2024 and subsequently sold on April 10, 2024.
- Adjusted Earning Per Share (“Adjusted EPS”)(3) of negative $0.01, with a year over year decrease of $0.02.
About Decibel
Decibel is a consumer-focused cannabis company focused on delivering products that delight customers through a commitment to robust innovation and product quality. Leading brands General Admission, Qwest and Vox are among its portfolio sold both across Canada and beginning to extend towards new countries to create a global footprint. Decibel operates a processing and manufacturing facility in Calgary, Alberta and two cultivation facilities in Creston, British Columbia and Battleford, Saskatchewan.
