Auxly Reports Third Quarter 2025 Results

Executive Summary

• Auxly Cannabis Group reported strong Q3 2025 financial performance, with net revenue up 20% YoY to $39.9 M and net income soaring 533% to $20.5 M.
• Adjusted EBITDA increased 48% YoY to $12.3 M (31% margin) and cash flow from operations rose 82% to $11.0 M, supporting a cash balance of $30.5 M.
• The company highlighted market‑share leadership (#3 licensed producer), brand strength (Back Forty #1 brand), and continued product innovation; it also repaid high‑interest debt saving ~$900k in annual interest expense.

Key Details

• Revenue & Growth
• Q3 2025 net revenue: $39.9 M (+20% YoY).
• Nine‑month net revenue: $111.4 M (+27% YoY).

• Revenue growth driven by higher volumes and improved pricing, especially in dried flower (≈62% of sales).

• Profitability

• Gross margin on finished cannabis inventory sold: 56% (Q3) vs 47% (2024).
• Adjusted EBITDA: $12.3 M (+48% YoY), margin 31%.

• Net income: $20.5 M (+533% YoY); basic EPS $0.02, diluted EPS $0.01.

• Cash & Balance Sheet

• Cash at quarter‑end: $30.5 M (up 66%).

• Debt unchanged at ~$54 M; interest expense fell to $1.4 M from $3.1 M due to debt conversion and lower rates.

• Operating Metrics

• SG&A expenses: $11.6 M (+38% YoY).
• Equity‑based compensation: $1.3 M (stable).

• Capital allocation: $2.0–$2.5 M of cash flow earmarked for projects at Leamington and Charlottetown facilities in 2025.

• Commercial Highlights

• Ranked #3 licensed producer by market share in Canada.
• Back Forty was the #1 cannabis brand nationally.
• Top‑selling SKUs: Liquid Imagination & Fire Breath 28g.

• Leader in all‑in‑one vape category (10 of top 15 SKUs).

• Strategic Actions

• Repayment of high‑interest debt post‑quarter, saving ~\$900k annual interest.
• Ongoing evaluation of organic growth alternatives and export opportunities.
• Continued focus on product innovation, capacity utilization at Leamington, and partnership with Imperial Brands.

Notable Quotes

• Hugo Alves, CEO: “Through product innovation, increased capacity utilization, favourable pricing and product mix, the Auxly team delivered another strong quarter of revenue and earnings growth… We are accumulating free cash flow, repaid high‑interest debt, and are evaluating organic growth alternatives to drive brand leadership, revenue growth and profitability over the long term.”