Cannabis distributor Humble & Fume Inc. (CSE:HMBL) (OTCQX:HUMBF) announced its financial and operating results for the three and six months ended December 31, 2021.
"During the quarter, Humble made meaningful progress towards our goal of becoming profitable by realigning our corporate structure and operations, while focusing on market expansion,” Joel Toguri, the company’s CEO, said. “Over this period, we have maintained stable revenue while absorbing one-time costs associated with the restructuring.”
Q2 2022 Financial Highlights
- Revenue totaled $16.9 million, compared to $16.8 million in the same quarter prior year.
- Gross profit was $2.4 million, which resulted in a gross margin of 14%, compared to $4.2 million, or a gross margin of 25%, year-over-year.
- Operating loss increased to $4.1 million from $1.3 million compared to the same period in the prior year.
- Net losses increased from $3.1 million to $4.1 compared to the same period in the prior year.
- Adjusted EBITDA was a loss of $3.6 million, compared to a $0.5 million loss for the same period in the prior year.
Six Months Ended Dec. 31
- Revenue decreased from $36.2 million to $34.9 million.
- In Canada, revenue increased by 12%.
- In the U.S., revenue declined by 14% .
- Gross profit decreased 12%, compared to the same period prior year, as a result of the sale of related clearance inventory.
- Net loss improved by $1.2 million due to the settlement of the convertible debenture in June 2021.
- Adjusted EBITDA came in negative at $4.9 million compared to $1.3 million for the same period in the prior year.
- Humble & Fume said that it continues to execute on its aggressive strategy to optimize the business and drive towards profitability, including the attractive cannabis opportunity in the U.S.
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It also reported a srong liquidity position at quarter end, including a cash balance of $14.3 million.
Operational Updates
October
- Announced it had signed a share purchase agreement to acquire licensed California cannabis distributor, Cabo Connection, the first step in itss U.S. expansion strategy.
November
- Announced it had completed a $8 million private placement by Green Acre Capital Distribution Corp. to acquire 15.23% of Humble, with an LOI to complete definitive agreements for an additional $2 million for the formation of a joint venture.
- Announced the appointment of Jakob Ripshtein as the new chairman of the board.
December
- Announced a new sales and distribution partnership with PAX Labs, Inc. for PAX branded Vape Devices in Canada.
- Announced that its common shares began trading on the OTCQX Best Market under the ticker symbol of HUMBF.
- Announced that it had entered into an exclusive sales representation agreement with Galaxie Brands Inc. for the commercialization and distribution of Wyld Cannabis Edibles in Canada.
Management Shake-Ups
Humble hired Jessica Hulser as a new general manager for the U.S. operations.
She brings over 20 years of experience in performance-based leadership and high-level operational execution in the logistics and distribution industry.
Prior to this she held roles within Johnson Brothers of Hawaii, Inc., Hawaiian Ocean Transport, Inc., and Odyssey Logistics, Inc..
At his new position, Hulser will be responsible for increasing sales, driving operational efficiencies, and spearheading the expansion into cannabis distribution in the U.S.
In addition, president and founder of Windship Trading, Nathan Todd, is stepping away from the company.
Photo: Courtesy of Josh Appel on Unsplash
