Heritage Cannabis posts C$2.3M in 3Q revenue on the back of its strong contract manufacturing business

Heritage Cannabis Holdings Corp (CSE:CANN) (OTCQX:HERTF) released its fiscal 3Q results on Tuesday after the bell, that showed the company generated just over C$2.3 million in revenue, driven by the strength of its contract manufacturing services.

CEO Clint Sharples called the quarter ended July 31, 2020 a “transitional” period, however, as the cannabis firm gears up to start sales of its Purefarma and Pura Vida brands, which launched this month in select Canadian provinces.

In May, the Toronto-based company announced it was launching Purefarma, its in-house brand of formulated extraction products, which will be sold through its licensed facilities. Purefarma will be sold through recreational channels and will feature several products that consumers have previously had access to under the patient-to-patient regime, including CBD-focused products such as elixirs and vape pens.

READ: Heritage Cannabis says vape products coming to British Columbia and Manitoba this month

Also in the quarter, Heritage purchased the Pura Vida brand, a line of tinctures, concentrates, and vape cartridge products with an initial run of full-spectrum Sativa, Indica & Hybrid Honey Oil vape cartridges, as well as Daybreak and Nightfall full spectrum THC tinctures.

As for its contract manufacturing business, Heritage signed a term sheet with True North Agri Inc and Weed Me Inc over the quarter. The company will produce full-spectrum cannabis oil and vape cartridge products for True North Agri and vape cartridge products for Weed Me.

“Our third-quarter revenue continued to show sequential growth, however, the quarter remained a transitional period for the business as we focused on ramping up our own product sales under the Purefarma and Pura Vida brands that we launched in BC and Manitoba in September,” CEO Sharples said in a statement.

“This combined with new contract manufacturing agreements, the launch of our products in additional Canadian provinces, our edibles product launch, and the acquisition of Opticann to expand our US presence will contribute to revenue growth going forward.”

Heritage’s 3Q revenue of C$2.3 million is a sharp increase from the comparable quarter a year prior when it did not report any revenue. The firm also reported a net loss of C$15,000 or $0.00 per share. For the nine-month period ended July 31, Heritage delivered $6.8 million in revenue.

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Story by ProactiveInvestors