Auxly Cannabis Group Inc (CBWTF)

[BlueGreenPower]

**NEWS** AUXLY REPORTS Q1 2022 FINANCIAL RESULTS

Hugo Alves, CEO of Auxly, commented: "Amid intense and growing competition and seasonal buying trends in the Canadian cannabis market, Auxly continued to see strength in sales, increasing revenues 147% year-over-year. Though this quarter presented some ongoing supply chain and operational challenges preventing us from meeting consumer demands for our branded cannabis products, we believe we have taken the necessary steps to correct these issues for the coming quarters, allowing us to increase fill rates and continue with our exciting new product launches throughout the year. We continue to lead the market in cannabis 2.0 products and remain focused on building to leadership in dried flower and pre-rolls and improving our business to achieve our goal of reaching adjusted EBITDA profitability."

https://finance.yahoo.com/news/auxly-reports-q1-2022-financial-112000752.html

Looks like Auxly did some balance sheet house cleaning this quarter, which is never pretty, but sometimes necessary when rightsizing a company. Looks like many cannabis companies are using this quarter to write down previously overoptimistic acquisition evaluations. This quarter Auxly had $33 million in gross revenues, but excise taxes took a third of it. To me this is way too much to ask of cannabis companies in a nascent industry. This raises product prices and keeps the black market in business. Tax relief needed.

Still Auxly is #1 in cannabis 2.0 sales, and projecting EBITDA positive in 2022, where Aurora and Canopy are projecting 2023. On the conference call company execs are still big on automation lowering labor costs and speeding up supply to the provinces. Looking forward to the bigger summer/fall selling seasons to get Auxly to over the top. always imho glta