Auxly Cannabis Group (XLY) Q1 2025 earnings summary

Executive summary

• Net income of $12.1M for Q1 2025, reversing a $26.0M loss in Q1 2024, aided by an $8.1M deferred tax recovery.

• Net revenue grew 29% year-over-year to $32.7M, driven by higher cannabis product sales, especially dried flower and pre-rolls.

• Gross profit more than doubled to $18.7M, with gross margin on finished cannabis inventory sold improving to 48% from 38% year-over-year.

• Adjusted EBITDA rose 232% to $7.4M, representing 23% of net revenue.

• Market share reached 5.8%, maintaining the #4 Canadian Licensed Producer position.

Financial highlights

• Revenue from cannabis sales: $49.2M (Q1 2025) vs $38.4M (Q1 2024); net revenue after excise taxes: $32.7M vs $25.2M.

• Gross profit: $18.7M, with a gross profit margin of 57%, up from 37% in Q1 2024.

• EPS: $0.01 (Q1 2025) vs $(0.03) (Q1 2024); diluted shares outstanding: 1.37B.

• Cash and cash equivalents: $17.1M at March 31, 2025, down from $18.4M at year-end.

• Debt reduced by 5% from year-end 2024, now at $52.1M.

Outlook and guidance

• Management highlights material uncertainty about the ability to continue as a going concern if sales or margins decline or debt cannot be refinanced.

• Focus remains on profitable growth, innovation, operational efficiency, and debt reduction.

• Continued expansion of product portfolio and distribution, with new SKUs and flavors driving category leadership.

• Management confident in delivering sustainable growth and reinforcing market leadership.

• Additional financing or asset sales may be pursued if negative cash flows persist.