Record Revenue: Net revenues of $25.1 million in Q1 2025, a 29% increase compared to $19.5 million in Q1 2024, driven by strong demand for Cannara’s premium-grade cannabis products.
Record Market Share: Achieved Canadian market share of 4.1%1, representing a 28% increase quarter over quarter, and 58% increase over the same period of prior year with gains across all licensed provinces.
Robust Profitability: Gross profit before fair value adjustments grew 23% to $9.8 million in Q1 2025 from $7.9 million in Q1 2024, with gross profit margins improving to 39%.
Industry Leading Operational Excellence: Delivered fifteenth consecutive quarter of positive Adjusted EBITDA2, generating a Company record of $6.0 million, in addition to record-high operating cash flow of $5.8 million, compared to $0.8 million in Q1 2024, and record free cash flow2, of $4.6 million compared to $(2.0) million in Q1 2024.
Strategic Growth Ahead: Plans to activate two additional grow zones and launch over 20 innovative new products in 2025, positioning the Company for continued leadership in the Canadian cannabis market.
All financial results are reported in Canadian dollars, unless otherwise stated.
MONTREAL, Jan. 27, 2025 (GLOBE NEWSWIRE) — Cannara Biotech Inc. (“Cannara“, “the Company“, “us” or “we“) (TSXV:LOVE) (OTCQB:LOVFF) (FRA: 8CB0), a vertically integrated producer of premium-grade cannabis and derivative product offerings at affordable prices with two mega facilities based in Québec spanning over 1,650,000 sq. ft., today announced its fiscal first quarter 2025 financial and operating results for the three-month period ended November 30, 2024. The condensed interim consolidated financial statements three-month period ended November 30, 2024, and the accompanying Management’s Discussion and Analysis can be accessed by visiting the Company’s website at investors.cannara.ca, or by accessing the Company’s SEDAR+ profile at www.sedarplus.ca.
“I am pleased to report to our shareholders that our Q1 2025 results delivered the strongest quarter in Company history, producing Company records for market share, revenue, adjusted EBITDA, operating cash flow, and free cash flow showcasing our successful execution of our long-term business strategy and industry leadership,” stated Zohar Krivorot, President & Chief Executive Officer of Cannara. “Net revenues grew by 29% to $25.1 million compared to Q1 2024, marking the highest quarterly revenue in our history. During the quarter, we achieved record market share, increasing our Canadian market share by 28% to 4.1%, with notable gains across all provinces where we are licensed to sell. These results highlight the growing adoption of our premium-grade cannabis products and the strong execution of our sales and marketing strategies.”
“As we look ahead to 2025, we are excited to continue building on this momentum with plans to open two new growing zones increasing our capacity by 6,000 kg per year and introduce over 20 products in existing and previously unmet product segments. Our expanding capacity and these product launches position us to capitalize on increasing consumer demand for our brands, while further solidifying our leadership in the Canadian cannabis market. We remain committed to driving sustainable revenue growth, scaling our production capabilities, and delivering exceptional value to our customers and stakeholders,” concluded Mr. Krivorot.
“Our record-breaking financial performance in Q1 2025 highlights the strength of Cannara Biotech’s operational model and our unwavering commitment to disciplined cost management and operational efficiencies while continuing to profitably grow the business,” commented Nicholas Sosiak, Chief Financial Officer of Cannara. “Gross profit before fair value adjustments increased by 23% to $9.8 million in Q1 2025, compared to $7.9 million in Q1 2024, driven by expanded production capacity, higher yields, and lower production costs. Gross profit margins also rebounded significantly due to improved cannabis yields, reflecting the long-term targets we strive to achieve, increasing from 30% in Q4 2024 to 39% in Q1 2025.”
“We delivered our fifteenth consecutive quarter of positive Adjusted EBITDA, totaling a record-high of $6.0 million, underscoring the scalability and profitability of our operations. Operating cash flow surged to $5.8 million, up significantly from $0.8 million in Q1 2024, and we delivered record-high free cash flow of $4.6 million, up from $(2.0) million in Q1 2024. This industry leading profitability profile reflects our extremely focused leadership, best-in-class production facilities, and many inherent competitive advantages within our operating platform, and will allow us to further strengthen our financial position.” concluded Mr. Sosiak.
Q1 2025 FINANCIAL HIGHLIGHTS
Q1 2025 vs Q1 2024 Comparable Period Highlights
Gross cannabis revenues increased by 33% to $34.9 million in Q1 2025, up from $26.3 million in Q1 2024, driven by deeper market penetration, new market entries, and the addition of new genetics and products.
Total revenues, net of excise taxes, rose by 29% to $25.1 million in Q1 2025 compared to $19.5 million in Q1 2024.
Gross profit before fair value adjustments grew by 23% to $9.8 million in Q1 2025 from $7.9 million in Q1 2024, supported by expanded production capacity, higher yields, and lower production costs.
Gross profit margin before fair value adjustments was 39% in Q1 2025, slightly down from 41% in Q1 2024.
Operating income increased to $4.2 million in Q1 2025 from $3.4 million in Q1 2024, reflecting higher sales and lower production costs, offset by increased sales and marketing expenses.
Net income was $2.3 million in Q1 2025, slightly up from $2.1 million in Q1 2024, as higher revenues were offset by increased selling and marketing expenses.
Adjusted EBITDA3 rose by 16%, from $5.2 million in Q1 2024 to $6.0 million in Q1 2025.
Operating cash flow surged to $5.8 million in Q1 2025 from $0.8 million in Q1 2024.
Free cash flow3 improved significantly, increasing by $6.6 million from negative $2.0 million in Q1 2024 to $4.6 million in Q1 2025.
Earnings per share increased to $0.03 in Q1 2025 compared to $0.02 in Q1 2024.
Q1 2025 vs Q4 2024 Quarter over Quarter (“QoQ”) Highlights
Gross cannabis revenues before excise taxes rose by 11% QoQ, from $31.4 million in Q4 2024 to $34.9 million in Q1 2025, driven by organic growth in Quebec and other markets, supported by targeted sales and marketing efforts to expand distribution outside Quebec.
Total revenues, net of excise taxes, increased by 7% QoQ, from $23.4 million in Q4 2024 to $25.1 million in Q1 2025.
Gross profit before fair value adjustments grew by 39% QoQ, from $7.0 million to $9.8 million, reflecting increased sales, greater market share penetration, and cost efficiencies achieved through economies of scale.
Gross profit percentage before fair value adjustments improved significantly, from 30% in Q4 2024 to 39% in Q1 2025, as higher cultivation yields from cannabis harvested in Q1 2025 drove profitability compared to Q4 2024. Investments in cultivation efficiency continue to maximize yield.
Operating income was $4.2 million in Q1 2025, compared to $5.1 million in Q4 2024, with the QoQ decline attributable to a lower unrealized fair value gain ($0.4 million in Q1 2025 vs. $3.8 million in Q4 2024).
Net income decreased by 60%, from $5.8 million in Q4 2024 to $2.3 million in Q1 2025, due to a $3.4 million fair value variance, higher sales and marketing costs, and the recognition of deferred tax assets of $2.0 million in Q4 2024.
Adjusted EBITDA4 increased by 63% QoQ, from $3.7 million in Q4 2024 to $6.0 million in Q1 2025.
Cash flow from operating activities rose from $3.2 million in Q4 2024 to $5.8 million in Q1 2025, reflecting increased sales and improved gross margin (39% in Q1 2025 vs. 30% in Q4 2024).
Free cash flow4 increased by $1.9 million QoQ, from $2.7 million in Q4 2024 to $4.6 million in Q1 2025.
Q1 2025 OPERATIONAL HIGHLIGHTS
OPERATIONAL
During the quarter, the Company continued to focus on execution, building its operations and supply chain to accommodate increases in sales and market share in Canada. The Company achieved its highest market share and revenue in Q1 2025 and expects its momentum to continue throughout 2025 as it continues to execute its sales and marketing strategies. This strong consumer demand provides further evidence of the unmet and uncaptured demand for Cannara’s leading brands and reinforces our strategy for further cultivation capacity expansion.
Innovating for Market Leadership
Launch highlights of Cannara’s product portfolio for Q1 2025 include:
Nugz Cured Resin All-in-one Vapes (Lemon Linx Q1 2025; G Sherb Q2 2025 Launch).
Nugz Shatter concentrates (Early Lemon Berry, Cuban Linx).
Nugz Stinky Cheese Infused Joints (#1 Quebec Infused Pre-roll Brand).
Tribal Trifecta Infused Pre-rolls (Flower-matched resin and diamond infused pre-roll, Cuban Linx, Gelato Mint; 2 additional product line extension planned for Q2 2025).
For fiscal year 2025, the Company expects to launch over 20 products in new and existing cannabis segments, including our new all-in-one vape devices under the Tribal and Nugz brands, and new flavors for Tribals’ premium infused Trifecta pre-rolls
Expanding Market Share and Strengthening Leadership Across Canada
The Canadian cannabis industry continues its rapid evolution, driven by the relatively recent federal legalization of adult-use cannabis just over six years ago. As a result of Cannara’s facilities, brand and genetic portfolio, and its competitive advantages, market response has solidified the Company’s presence in Canada’s four largest markets, Ontario, Alberta, Quebec and British Columbia and has establish itself in 3 secondary markets. The table below presents the Company’s national and provincial market share for the most recent completed quarter, along with a comparison to the previous quarter and same period of prior year. Cannara’s recent performance across various provinces highlights its continued successful performance across all markets demonstrating its ability to capture market share from its competitors.
Q1 2025 vs Q4 2024 National and Provincial Market Share5
The table below presents the Company’s national and provincial market share for the most recent completed quarter, along with a comparison to the previous quarter.
National Market Share (QoQ)
Q1 2025
Q4 2024
Variance
Cannara Biotech Inc.
4.1%
3.2%
+28.1%
Province
Q1 2025
Q4 2024
Variance
Quebec
12.5%
11.9%
+5.0%
Ontario
2.6%
2.3%
+13.0%
Alberta
2.4%
1.8%
+33.3%
British Columbia
1.5%
1.4%
+7.1%
Saskatchewan
1.7%
1.5%
+13.3%
Manitoba
1.0%
0.8%
+25.0%
Nova Scotia
0.4%
0.1%
+300.0%
Q1 2025 vs Q1 2024 National and Provincial Market Share6
The table below presents the Company’s national and provincial market share for the most recent completed quarter, along with a comparison to the same period of prior year.