Auxly Repays $5 Million Inventory Loan

Executive Summary

• Auxly Cannabis Group repaid in full its $5 million inventory loan to GrassHopper Capital, using cash on hand.
• The repayment eliminates all principal and accrued interest and is expected to save approximately $900 k of annualized interest expense.
• Management highlighted that the repayment reflects strong operating cash flow and supports continued balance‑sheet strengthening and organic growth investments.

Key Details

• Loan Repayment: Full repayment of the $5 million inventory loan (principal + accrued interest) to GrassHopper Capital Inc.
• Funding Source: Cash on hand was used for the repayment; no new financing was incurred.
• Interest Savings: Expected reduction in annualized interest expense of roughly $900,000.
• Strategic Rationale: Management indicated the repayment aligns with a strategy to “strategically allocate capital,” strengthen the balance sheet, and fund organic growth initiatives.
• CEO Comment: Hugo Alves (CEO) stated that the company’s profitable growth and stable cost base generated free cash flow, making loan payoff an “obvious choice for deploying our excess cash.”

Notable Quotes

“Our business is growing profitably and is now in the position to strategically allocate capital… solidifying our balance sheet and reducing interest expense was an obvious choice for deploying our excess cash,” – Hugo Alves, Chief Executive Officer.