OrganiGram Holdings (NASDAQ:OGI) stock had dropped almost 33% over the last month as investor hype regarding its potential went up in smoke when the company released quarterly earnings.
The provincial lockdown measures due to COVID-19 impacted cannabis outlets’ bottom line in Q1 2021. It is worth noting that OrganiGram has challenges with its business model even before these containment measures began.
In the quarter ended February 28, the company saw its net revenue drop 37% YoY to CA$14.64 million. The decline was due to low wholesale volume, lower port prices, and a lack of brand popularity. Interestingly, over the past year, OrganiGram unveiled 62 new products, and there are another 31 that will launch by next quarter. In Q2 2021, the company sold 3,688 Kg of dried cannabis, a 10% QoQ drop.
Most importantly, the company has eliminated its debt through financing rounds, and at the end of Q2 2021, it had CA$232 million in cash. Recently a British American Tobacco subsidiary acquired 20% interest in the company for CA$221 million. In the coming months, OrganiGram stock is worth watching.