Toronto-based Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) closed its 2023 fiscal year on Sept. 30 with a C$248.6 million loss, a whopping 1,641% increase from the prior year when the company posted a C$14.2 million loss.
The loss contrasted with the company’s C$161.6 million in net revenue for the fiscal year, which was up 11% year-over-year from C$145.8 million. The company attributed the majority of its loss to “impairments on PP&E, intangibles, and goodwill.”
Organigram also reported an adjusted gross margin of C$40.2 million for the fiscal year, a year-over-year increase of 20% from C$33.4 million in 2022.
CEO Beena Goldenberg focused her year-end analysis on how the company “drove our growth” in several product categories such as pre-rolled joints and edibles.
“We ended the year in the No. 2 market position, which we held as of November 30,” Goldberg noted, which the company said was primarily thanks to its success in the pre-roll field.
“In fiscal 2024 we expect improved margins from efficiencies tied to our completed facility upgrades and growth in higher margin categories such as craft flower and vapes, while the $124.6 million financial commitment from (British American Tobacco) expedites our plans for international growth,” Goldberg said.
The hefty investment from BAT (NYSE: BTI) follows an earlier 2021 investment of C$221 million by the international tobacco company, Organigram noted. The two companies are also still working closely on more cannabis product R&D, particularly in the edible, vape, and beverage categories.
With various market entrances, new product debuts, and more R&D in the works, Organigram is still poised for a solid 2024, interim CFO Paolo De Luca said in the release.
“With our investments in differentiated advantages yet to be fully realized, such as THCV, cost-savings from seed-based production, and novel vape hardware technology, we remain laser focused on leading the industry in Canada and beyond,” De Luca said.
Organigram also this week announced De Luca’s successor, after the company board chose Greg Guyatt as a permanent chief financial officer, who joins the firm from Phoena Holdings, where he served first as CFO before becoming CEO in 2020. Guyatt’s appointment is effective Jan. 8.
In an industry outlook summary, Organigram asserted that the Canadian marijuana market “as a whole continues to grow,” but that it “remains saddled by a high excise tax regime and in some cases, restrictive regulations.”
Due to tight capital and fundraising constraints, Organigram stated, some Canadian marijuana companies “are either shuttering certain money-losing operations, closing down entirely, or entering creditor protection.”
Amid a flailing national cannabis industry, Organigram said, its fundamentals were stable, with relatively little debt compared to its revenues and overall assets, and with a solid revenue increase expected in the coming year.
As of Sept. 30, Organigram had C$298.4 million in total assets, including C$33.8 million in cash, against C$26.8 million in total liabilities.
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