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The Valens Company Inc. (TSX:VLNS) (NASDAQ:VLNS) reported Thursday its third quarter fiscal year 2022 financial results for the period ended August 31, 2022, revealing net revenue of CA$20.3 million ($14.1 million), down by 15.4% from CA$24.0 million in the previous quarter.
Despite the decline in net revenue quarter-over-quarter, adjusted gross profit increased by CA$0.9 million in Q3 2022 to CA$5.1 million from CA$4.1 million in Q2 2022.
Adjusted EBITDA was a loss of CA$9.8 million, compared to a loss of CA$15.9 million in the previous quarter.
Net loss amounted to CA$27.5 million or CA$0.34 per share, versus a loss of CA$160.8 million or $2.13 per share in the second quarter.
Cash flow from operations for Q3 2022 was CA$(7.6) million, a significant CA$12.2 million or 61.7% improvement quarter-over-quarter, strongly beating previous guidance of CA$(9) million to CA$(12.5) million.
Provincial sales increased 22.8% to CA$11.3 million in Q3 2022 from CA$9.2 million in Q2 2022. The increase was primarily driven by higher demand of our newly launched branded products across our brand portfolio.
International revenue and other revenue (including Valens Labs and Pommies Cider) declined in the quarter to CA$0.7 million as orders are lumpier.
"Our third quarter results clearly show that we are executing on the most important initiative in this environment which is cash flow,” stated Tyler Robson, chief executive officer of The Valens Company. “We are continuing to realize the benefits of our previously announced Integration Initiatives, with a significant decrease in our cash burn, which not only exceeded our previously stated guidance range but was down approximately 62% quarter-over-quarter, despite lower net revenues,"
In light of the proposed acquisition of the Company by SNDL (NASDAQ:SNDL), Valens is withdrawing all previously given financial guidance as such financial guidance is no longer appropriate under the circumstances.
Price Action
The Valens’ shares traded 6.06% higher at $0.7 per share during Thursday pre-market session.
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