James Wagner Cultivation (TSXV: JWCA) reported its fourth quarter 2019 earnings this morning, recording just over $1.0 million in net revenues for the three month period ended September 30, an increase of 40% over third quarter earnings. Losses widened compared to the third quarter, with the firm reporting a net loss of $3.0 million for the period.
In terms of the full fiscal year, revenues for fiscal 2019 came in at $2.8 million, as compared to $57,612 in the prior year. 2019 saw a total net loss of $9.2 million, as compared to a loss of $10.3 million in 2018.
Operating expenses during the fourth quarter totaled $1.4 million, compared to $2.8 million in the prior quarter. However, due to a change in expense reporting, its not clear where specifically these savings were realized over the quarter. Rather, it appears to be under the general and administrative heading, while further details are not available.
In terms of cash flow, James Wagner consumed $9.4 million in operational activities during the full fiscal year of 2019, compared to $5.8 million in the prior year. Investing activities was also a net negative as well, with total cash outflows coming in at $8.3 million, largely due to capital projects undertaken in the last year for expanded growth. This was offset by financing activities of $10.6 million, leaving the firm with a year end cash position of $1.2 million.
Moving to the balance sheet, receivables climbed to $1.2 million from $0.7 million in the third quarter. Inventories and biological assets came in at $3.1 million and $2.8 million respectively, compared to $2.1 million and $3.4 million in the third quarter. Total current assets declined to $9.9 million during the three month period period.
Total current liabilities were up slightly over the quarter, thanks in part to the current portion of long term debt declining to $3.8 million from $4.9 million. Accounts payable climbed from $1.1 million to $2.8 million, with total current liabilities coming in at $6.6 million. Total working capital as a result currently sits at $3.2 million.
Per gram sales figures were not provided the quarter, however the company highlighted that its average yield per plant grew from 247 grams to 260 grams.
James Wagner provided an outlook this morning with respect to the coming quarters, denoting that it anticipates being cash flow positive in the second quarter of fiscal 2020, which includes a positive net income. This is expected to coincide with the entrance of James Wagner to recreational markets as the firm further develops its sales channels.
James Wagner last traded at $0.22 on the TSX Venture.
Information for this analysis was found via Sedar, and James Wagner Cultivation. The author has no securities related to this organization. James Wagner Cultivation was previously a client of CanaCom Group, the parent company of The Deep Dive. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.