The following is a summary of the Avant Brands Inc. (AVTBF) Q4 2023 Earnings Call Transcript:
Financial Performance:
Avant Brands reported record gross revenue of $30.2 million and net revenue of $26.3 million in Q4 2023, reflecting a 33% and 31% increase respectively year-over-year.
The company's Canadian recreational net revenue experienced a 10% increase from the previous fiscal year, reaching $15.8 million.
Business-to-Business (B2B) and export revenues were at a high of $10.2 million, a rise of 96% compared to the prior fiscal year.
Gross margin slightly increased to 34%, compared to 32% reported the previous year.
Adjusted EBITDA hit $4.4 million, a 132% hike from the previous year, while net loss from operations markedly decreased to $1.5 million, a significant improvement from the $8.5 million loss reported previously.
Cash flow from operations recorded a record inflow of $5.4 million.
Business Progress:
Avant Brands started shipping for one of its four deals in early Q2 while other past deals started to monetize.
The company maintained successful relations with its export clients such as IMC in Israel and an unnamed client in Australia.
The company continues to expand globally, operating in Israel, Australia and entering the German market.
Avant aims to offset declining Canadian adult-use revenues with high-volume export deals and is exploring opportunities in new markets such as the UK, Ukraine, and Poland.
Avant Brands is considering integrating new genetic strains into the cultivation process to increase product differentiation and is investigating the potential of contract growing to tackle the issue of export quota.
The company reduced its debt from $9-9.5 million to $4.75 million, making it manageable.
Avant Brands announced amendments to seller financings payments with F-20 and MENA, reducing payments and extensions in due dates, allowing the company to reinvest into strategic objectives.
Despite a decrease in average flower selling prices, Avant maintains its premium pricing strategy across all channels and expects significant improvement in the company's cash flow position for the upcoming quarter.
The company predicts an increase in financial performance in the upcoming quarters with a focus on customer preferences and the export market.
The company carried out aggressive acquisitions including the acquisition of the other half of 3PL and Flowr, reinforcing its position in the global arena.
More details: AVANT BRANDS INC IR
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