Adam Jackson
California-based Lowell Farms Inc. (CSE: LOWL) (OTCQX: LOWLF) reported another sizable slide for the second quarter ending June 30, with the company losing nearly half its revenue over the past year.
The company’s reported revenues fell by 47% to $7 million, down from $13.2 million in the second quarter of 2022. That comes after a 7% decline sequentially.
Dissecting the revenue stream:
- Consumer packaged goods revenue fell by 40% over the year; 5% sequentially.
- Revenue from self-grown wholesale products dropped 34% over the year; 11% sequentially.
- Processing services revenue fell by 95% over the year; 18% sequentially.
- Out-of-state licensing was a brighter spot, with a decrease of only 14% over the year, and a rise of 7% sequentially.
Net loss was $100,000 versus a net loss of $4.6 million in the same period last year, and a net loss of $4 million sequentially.
Adjusted EBITDA was negative $1.2 million versus an adjusted EBITDA loss of $1.1 million in the same period last year and sequentially.
“Having implemented cost-saving measures throughout the first and second quarters of 2023, we remain focused on an upward trajectory,” CEO Mark Ainsworth said in a statement.
“Our focus for the foreseeable future remains on maximizing efficiencies and new revenue streams, including third-party distribution, while expanding our portfolio of owned brands with new product lines that will captivate and command loyalty among consumers.”
The company’s moves toward refining its cultivation processes was highlighted, reporting a production of approximately 6,730 pounds of flower product during the second quarter. The company attributed its consistent THC potencies to recent upgrades made to its cultivation systems. Still, it also cited issues from a HpLV outbreak, which “attributed to weakened plant immunity.”
Additionally, the Lowell Herb Co. product line remains a strong performer in the California market, the company said, with its non-infused pre-roll brand holding its place as one of the state’s top three sellers.
The company also reported growth outside of California. Its out-of-state revenues saw a 7% increase, bringing in $237,000 during the period. Lowell said it remains a top-seller in states like Massachusetts, Illinois, and Arizona.
Overall, the company said it is focused on expanding its portfolio and refining its processes as it weathers sliding prices and oversupply in key states.
