Eve & Co Incorporated (TSXV: EVE) last night filed its third quarter 2020 financial results, reporting a decline in net revenues of 50.3% on a quarter over quarter basis with revenues falling from $1.3 million to $0.6 million. THe company also posted a net loss of $4.3 million, as compared to a net income of $29.0 million in the prior period.
The massive decline in revenue reported by the company, based on the filed management discussion and analysis, is believed to be a result of a one-time bulk sales arrangement that went through in the prior quarter. It should also be noted that with production costs of $0.7 million, the company posted a gross loss before fair value adjustments, and before a $1.7 million inventory write down is factored into the equation.
Total expenses meanwhile amounted to $1.5 million during the quarter, just shy of twice the gross revenue figure posted during the same period. General and administrative expenses amounted for the largest portion at $0.7 million, followed by operating labour of $0.2 million as well as finance expenses at $0.2 million and share based compensation at $0.2 million.
Loss from operations overall amounted to $4.3 million, which resulted in an overall net loss of $4.3 million following minimal other income of just $722.
Looking to the balance sheet, and the company appears to be in a dire position. Cash has fallen to just $0.4 million, and with the company spending $0.4 million in operating activities, $0.2 million in financing activities, and $39k in investing activities over the three month period, it does not provide a positive outlook for the firm.
Other receivables and prepaid expenses climbed from $0.6 million to $0.7 million, while inventory also climbed marginally from $9.3 million to $9.4 million, despite the write downs exhibited above. Accounts receivable however fell from $1.4 million to $0.9 million, while biological assets tumbled from $3.4 million to $1.2 million. Total current assets overall fell from $15.8 million to $12.6 million.
Accounts payable meanwhile rose from $5.5 million to $6.0 million, which proves problematic given the low cash position held by the company. Loans nd borrowings stayed flat at $18.6 million, with the outstanding promissory note also staying flat at $0.9 million. Total current liabilities, as well as total liabilities, rose from $25.1 million to $25.6 million overall.
Eve & Co last traded at $0.07 on the TSX Venture.
Information for this briefing was found via Sedar and Eve & Co Incorporated. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
