Greenlane Holdings, Inc. (NASDAQ:GNLN) reported its financial results for the third quarter ended Sept. 30, 2024, disclosing revenue of $4 million compared to $11.8 million in the prior year period.
The Florida-based cannabis company noted that beginning with its second quarter 2023 earnings release, it implemented a major restructuring of its industrial product lines, transitioning much of this business from gross sales to a commission structure. This change affects how Greenlane reports revenue and enables it to preserve working capital and improve gross margins.
"During the third quarter, we continued to make progress on strengthening our product strategy and roadmap, enhancing our sales team structure and compensation arrangement, and further extracting operating efficiencies across the enterprise," stated CEO Barbara Sher "We continue to see evidence that our efforts to reposition the business over the last six months have been proving successful. As we enter the next phase of our transformation, we are evolving our product portfolio with the addition of health, safety and wellness products that we believe can broaden our market opportunities and grow revenue."
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Q3 Financial Highlights
- Gross margin percentage increased 48.4% to 75%.
- Gross profit amounted to $3.03 million, compared to $3.13 million in the same period last year.
- Total operating expenses were $3.6 million, a decrease of 64% compared to $10.0 million in the prior year period.
- Operating loss improved by approximately $6.3 million to $538,000 compared to an operating loss of approximately $6.9 million in the prior year period.
- Net loss was $3.8 million, which included a $3.2 million one-time non-cash charge for interest expense in connection with various merchant cash advances, compared to a net loss of $10.1 million in the prior year period.
- As of September 30, 2024, the company had cash and cash equivalents of approximately $2.3 million.
Recent Milestones
In August, Greenlane entered into a securities purchase agreement with a large institutional investor for gross cash proceeds of $6.5 million. Under the agreement, the vendor of cannabis accessories and vaporization products issued 3.36 million units.
Earlier the same month, the company announced plans to distribute Safety Strips, Inc.'s fentanyl, xylazine and drink spike detection test strips across the U.S. The company's Safety Strips Fentanyl Test Strip (FTS) ISO 13485 validated product can detect potent synthetic opioids, including 3-methyl Fentanyl, Acetyl Fentanyl, Butyryl Fentanyl, Carfentanil, Fentanyl, Furanyl Fentanyl, Ocfentanil, Remifentanil, Sufentanil, Valeryl Fentanyl, and p-Fluoro Fentanyl. The announcement caused Greenlane's shares to jump 244.40%.
Price Action
Greenlane shares closed Friday market session 6.70% lower at $1.95 per share.
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