Saturday, May 31, 2025

Latest

Valens Announces $27 Million Q4 Guidance, Share Buybacks

Valens GroWorks (TSXV: VGW) this morning announced guidance for the recently completed fourth quarter, providing a revenue estimate of between $27 and $30 million for the three month period. The firm also announced its intent to initiate a normal course issuer bid for its securities.

Guidance for the quarter represents a substantial improvement on a quarter over quarter basis. In the third quarter of fiscal 2019, Valens reported revenues of $16.4 million, which was a marked improvement from the previous quarter. Today’s guidance in effect translates to a near doubling of quarterly revenues, in a time where major sector players such as Hexo Corp are showing flat or decreasing revenues during relatively the same time period.

What will be key however is the impact the increasing revenues will have on both gross margin as well as the profitability of the firm. Last quarter Valens reported a net income of $5.8 million, however the fiscal year is still negative at $11.0 million. In this regard, the positive news is that relatively the same amount of biomass was extracted in the fourth quarter compared to the third quarter, suggesting increased gross margins for the period. The increase in revenue is largely a function of white label agreements.

Secondly, Valens GroWorks also announced its intent to commence a normal course issuer bid for its common shares, also known as a share buyback. The firm intends to purchase up to 5%, or 6,275,204 common shares of its equity as a result. The buyback program is expected to occur over a period of one year.

The intent to conduct share buybacks before achieving profitability is a curious move, given current sector sentiment. This is compounded by the relative strength of Valens when compared to the cannabis sector as a whole, who has stayed relatively flat over the course of the year – a positive position when compared to the dominant sector index HMMJ.

Valens GroWorks last traded at $2.90 on the TSX Venture.


Information for this briefing was found via Sedar and Valens GroWorks. 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.

Video Articles

Alamos Gold Q1 Earnings: The Inside Scoop

Cerrado Gold Q4 Earnings: The Turnaround is Working

B2GOLD Q1 Earnings: Revenue Up, Production & Cash Flow Decline

Recommended

Canadian Copper: The $172M Combined Strategy PEA

ESGold Begins Concentration Tests Ahead Of First Production

Related News

Valens Releases Third Quarter Guidance of $16 Million

Valens GroWorks Corp (TSXV: VGW) provided guidance this morning for its recently completed third quarter...

Tuesday, September 10, 2019, 09:00:47 AM

Valens Company Announces Extraction Arrangement with Emerald Health

The Valens Company (TSXV: VLNS) announced this morning two new multi-year agreements for extraction services....

Monday, December 23, 2019, 07:57:52 AM

Valens Groworks Reports Revs of $2.2m, Releases Guidance for Q2

Valens Groworks (CSE: VGW) reported its first quarter 2019 revenues yesterday after the bell, announcing...

Thursday, April 25, 2019, 07:30:37 AM

Valens GroWorks Obtains Sales License

Valens GroWorks (TSXV: VGW) announced this morning that it has received a sales license from...

Monday, September 23, 2019, 09:10:22 AM

Valens GroWorks Enters Contract With Beverage Alcohol Firm Iconic Brewing

Valens GroWorks (TSXV: VGW) announced this morning that it is one of the first extraction...

Thursday, September 12, 2019, 08:54:26 AM