Tilray Brands (TSX: TLRY) appears to be struggling when it comes to topline revenue. The firm this morning posted its second quarter 2023 results for the period ended November 30, 2022, posting declining revenue versus that of its first quarter results.
Revenue for the quarter came in at $144.1 million, down from $153.2 million on a quarter over quarter basis, with the firm instead working to transition investor focus to operating cash flow and “long term profitability.” On a constant currency basis, the firm reportedly recorded $157.6 million in revenue, versus last quarter’s constant currency figure of $166.5 million.
“During the second quarter, Tilray Brands took decisive, effective actions to manage operating cash flow and focus the business on accretive acquisitions and a path to long term profitability. And we have certainly done so – even amid an evolving retail environment – by removing costs and driving efficiencies across the platform in supply chain, procurement, packaging, and labor,” commented Irwin Simon, CEO and Chairman of Tilray.
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READ: Tilray Brands Posts Flat Revenue In Q1 2023
In terms of revenue breakdowns in terms of constant currency, the firms cannabis segment saw revenues decline from $61.6 million to $52.2 million on a quarter over quarter basis, with revenue share falling from 38% to 33%. Distribution revenues meanwhile were relatively flat, moving to $71.0 million from $70.6 million, and accounting for 45% of revenue versus the prior 42%. Beverage alcohol came in at $21.4 million, an improvement from $20.7 million, and accounting for 14% of quarterly revenue, while the wellness business saw revenues decline slightly from $13.7 million to $13.1 million, while accounting for 8% of revenues.
Despite a near 6% decline in topline revenue on a quarter over quarter basis, Tilray saw its cost of goods sold essentially remain unchanged at $104.0 million, resulting in gross profits declining from $48.6 million in Q1 to $40.1 million in the second quarter. Operating expenses meanwhile totaled $91.9 million, lead by $41.7 million in general and administrative expenses.
As a result, the firm posted an operating loss of $51.8 million for the three month period, with non-operating expenses, interest expenses, and an income tax benefit ultimately pushing the company to post a net loss of $61.6 million for the quarter, versus a $65.8 million net loss in the first quarter. Adjusted EBITDA meanwhile was reported as being $11.7 million.
In terms of its balance sheet, the firm saw its cash and cash equivalents decline from $490.6 million to $190.2 million, which is in large part due to $243.3 million being moved to marketable securities. Total current assets overall declined to $814.7 million from $910.8 million, with total assets falling from $5,592.5 million to $5,474.4 million.
Total current liabilities meanwhile increased substantially from $273.3 million to $426.5 million. The increase is largely attributed to a portion of outstanding convertible debentures becoming current, to the tune of $181.5 million. Overall, total liabilities declined from $1,029.3 million to $991.2 million.
The firm meanwhile reported $29.2 million in operating cash flow and $25.4 million in free cash flow for the three month period.
Tilray Brands last traded at $3.96 on the TSX.
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.
