Sundial Growers Reports Q3 Revenues Of $14.4 Million, Announces Buyback Program

Sundial Growers (NASDAQ: SNDL) last night reported their third quarter financial results, reporting revenue of $14.4 million for the quarter ended September 30. The company also managed to post a positive net income for the quarter of $11.3 million.

Revenue was up up significantly over the second quarter, largely a result of the closed acquisition of Inner Spirit Holdings, which gave the company a retail earnings boost. Revenue climbed from $9.2 million overall to $14.4 million.

Gross margins before fair value adjustments however were negative, thanks in part to a $3.9 million inventory writedown, with gross margins coming in at negative $1.2 million overall. The firms investments meanwhile recognized interest and fee revenue of $3.3 million, and a share of profit from equity accounted investees of $9.9 million, which was offset by a $18.0 million investment loss.

Overall, following expenses that include $9.6 million in general and administrative and $2.4 million in depreciation, the company recorded a loss from operations of $18.8 million.

This loss however was turned around due to a $24.1 million boost from the change in the fair value of derivatives among other items, and a $10.1 million income tax recovery, resulting in a net income for the quarter of $11.3 million. Adjusted EBITDA meanwhile came in at $10.5 million.

The firm also reported a cash, marketable securities and long term investment figure of $1.1 billion, which has grown to $1.2 billion as of November 9. $571 million of this is reportedly unrestricted cash.

The massive cash position has resulted in the company announcing a share buyback program, which will see Sundial repurchase up to C$100 million worth of its shares. A maximum of 102.8 million shares can be repurchased under the program, with the program beginning November 19, 2021. In effect, the repurchases will begin to undo the effects of the massive at-the-market offering it conducted this year.

Sundial Growers last traded at $0.72 on the Nasdaq.

Information for this briefing was found via Sedar and the companies mentioned. 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.

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