Heritage Cannabis Holdings Corp. reported its unaudited sales for July hit a monthly record of $3.2 million, marking the fifth monthly sales record in 2021.
The Toronto-based vertically integrated cannabis company said the record sales figures reflect its growing market share after it introduced innovative products and expanded distribution channels.
As sales momentum builds, the company said it remains focused on increasing margins and containing costs. Gross margins for July also achieved a monthly record, while selling, general and administrative (SGA) expenses continued to decline from the level reported in the second quarter.
READ: Heritage Cannabis Holdings says 2Q revenues soar 250% quarter-over-quarter; provides operations update
“I am incredibly proud of the team at Heritage for the execution of our strategy and our success in steadily growing revenue in 2021,” newly-appointed CEO David Schwede said in a statement.
“We are consistently breaking sales records on a monthly basis and market share data confirms that we are increasing our sales velocity.”
Schwede said many of the initiatives Heritage has been working on behind the scenes are only just beginning to translate into sales. Dried flower and pre-rolls increased penetration in Ontario, and new product releases are only at their infancy.
“We expect that these efforts will continue to drive growth for many more months to come,” Schwede added.
Heritage said vape products have been a key driver in recent sales growth initiatives with sales hitting consecutive records every month this year. The company offers vape products under four of its brands: Premium 5, RAD, Purefarma, and Pura Vida. It said it has been proactively managing its offerings to stay price competitive in all segments, while also delivering innovative products and new flavour profiles to keep up with consumer demands.
Heritage said it continues to command a large market share of concentrate products and holds the third spot in Canadian sales for the first half of 2021. Heritage brand Premium 5 introduced the first dabs and first live resin products in the country in 2020 and is continuing to lead the category in innovation.
The company currently has 30 concentrate SKUs in the market, with sales of the RAD line showing enormous traction in all markets where they are currently offered.
In July, Heritage filled the first of its orders for dried flower to British Columbia, leveraging its strong brand awareness with consumers, and selling out within the first week of hitting retail shelves. It said it is continuing the rollout of new dried flower and pre-roll products across the country, with a total of 10 SKUs set to be released in the fourth quarter of the year.
It noted that cannabis still makes up 64% of recreational cannabis sales in Canada according to Government of Canada research, and will be an important area of sales growth in the coming months.
Heritage also updated investors on its proposed acquisition of California-based Bloom Brands, which was announced on June 1, saying a due diligence is continuing.
The acquisition will provide it with an immediate market footprint in California, New Mexico, Oklahoma, Washington, Nevada, and Arizona and also immediately creates a revenue-generating US platform solidifying its cannabis strategy to establish its distribution platform in nine states.
The unaudited, attributed sales for Bloom in the second quarter were about US$2.56 million, representing a 9.4% increase from the first quarter of 2021.
Heritage expects to release its full fiscal 3Q results by the end of September.
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Story by ProactiveInvestors
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