Adam Jackson
For the second time this year, Delivra Health Brands Inc. (TSXV: DHB) (OTCQB: DHBUF), a consumer packaged goods company with a position in the health and wellness sector, reported positive adjusted EBITDA.
The company on Tuesday announced its financial results for the third quarter ended March 31 showing stable revenue and more gross profit.
Delivra Health, formerly known as Harvest One, reported total net revenue from continued operations of $2.35 million in the quarter, a slight rise from $2.34 million during the same period last year. The steady revenue was largely driven by higher sales of the company’s product, Dream Water, in the U.S. to international distributors.
Gross profit for the period increased to $960,000 from $910,000 last year, lifting the gross profit margin to 41% compared to last year’s 39%. The company said that the margin boost was attributed to increased sales volume and higher-margin sales from the U.S.
While the revenue held steady, Delivra Health managed to reduce expenses, lowering SG&A costs and other non-cash items from $1.55 million in the same period last year to $1.25 million in the reported period. The 19% reduction was credited to operational improvements and cost reduction measures identified in the company’s strategic review completed in March 2021, it said.
The company posted an adjusted EBITDA of $23,000, marking a substantial improvement from the loss of $610,000 in the same period last year. The change was credited to management’s focus on customer mix, gross profit margin improvement, and more efficient administrative and selling support functions.
“These financial results demonstrate that we are on track in our commitment to profitable growth and shareholder value creation,” President and CEO Gord Davey said in a statement. He added that the company aims to continue the positive trend by investing in innovation and expanding distribution channels.
Fiscal year-to-date, Delivra reported net revenue inched up 4% to $6.47 million, with a gross profit margin of 44%.
At the same time, expenses were significantly reduced by implementing measures identified in a strategic review completed in February 2020, “which resulted in lower salaries and sales and marketing expenses to conserve cash.”
