SLANG Global First Quarter Revenue Down 35% Year-Over-Year, Touts E-Commerce Segment Improvement With CBD Gummy Brand – SLANG Worldwide (OTC:SLGWF)

Cannabis consumer packaged goods company SLANG Worldwide Inc.(CSE:SLNG) (OTCQB:SLGWF) released its financial results on Thursday for the first quarter ended March 31, 2024. The Toronto-based company announced revenue of C$7.03 million ($5.13 million), up from CAD 10.8 million.

The company attributed the revenue decline to increased competition in recreational marijuana dispensaries in its core markets in Vermont and Colorado, offset by growth in the wholesale channel in Vermont and decline in the overall Colorado cannabis market.

“Our first quarter results demonstrated the importance of SLANG’s differentiated strategy, as well as our commitment to a disciplined and efficient business model,” he said John Moynan, CEO of SLANG. “While we saw weakness in our core markets in the first quarter, we mitigated the impact on our business through increased sales in our newer, higher margin e-commerce channel, our wholesale channel in Vermont and in our emerging markets, and by reducing operating expenses sequentially and year-over-year, increasing operational efficiency in most segments of our business.

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Financial summary of the first quarter of 2024

• Gross profit of C$3.36 million (48% gross margin) in Q1 2024 compared to C$5.72 million (53% gross margin) in Q1 2023, a 41% decline in gross profit and gross margin by 5% year-on-year.
• Operating expenses were C$5.54 million in Q1 2024 compared to C$5.78 million in Q1 2023 and C$6.63 million in Q4 2023, a 4% year-over-year decline and a 16% quarter-over-quarter decline.
• Adjusted EBITDA represents a loss of C$1.06 million in Q1 2024 compared to a profit of C$742,000 in Q1 2023.
• The total comprehensive loss was C$6.02 million, which compares with a loss of C$2.33 million in the first quarter of 2023.
• As of March 31, 2024, the company had C$8.32 million in cash and restricted cash compared to C$9.04 million as of December 31, 2023.

Operational highlights for the first quarter of 2024

• Vermont wholesale sales for the first quarter of 2024 were C$310,000 compared to C$60,000 for the first quarter of 2023.
• In the first quarter of 2024, SLANG signed an agreement with a new distribution partner to sell Alchemy Naturals CBD gummies throughout the United States.

“Our new channels’ share of overall sales continued to increase this quarter. Revenues from our e-commerce segment increased approximately 45%, demonstrating the strength of our Alchemy Naturals CBD Gummies line, and our wholesale channel in Vermont increased approximately 417% year-over-year,” Moynana continued. “As we look to the future, we believe we will continue to elevate our market position and build leadership in these important cannabis product categories.”

Reduction

As of this writing on Thursday morning, Slang shares were 7.32% lower at $0.02 per share.

Related Link: Cannabis CPG Co. SLANG Worldwide reduces Q4 loss by 56% y/y, reports revenue decline

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