Organigram (NASDAQ:OGI) reported fiscal first-quarter results after the bell on Tuesday that exceeded Wall Street's expectations. In addition to better-than-expected sales, the Canadian cannabis producer reported positive cash flows on an adjusted basis.
Organigram has just one cultivation and processing facility in New Brunswick, but it's generating revenue that grew 102% year over year to CA$25.2 million. That was CA$10.2 million more revenue than the average analyst had expected.
In addition to exceeding top-line expectations, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) bounced back. Organigram reported adjusted EBITDA that reached CA$4.9 million after it dipped into negative territory during the previous three-month period.
During the fiscal fourth quarter, Organigram reported a CA$3.7 million provision for product returns and other adjustments. Investors were happy to see a much more reasonable $1.1 million provision during the latest period.
Organigram expects more positive cash flows in 2020, thanks in large part to a very efficient production facility. The cash cost to produce a gram of dried flower dropped from $0.66 per gram during the previous three-month period to just $0.61 per gram during the company's fiscal first quarter.
In December, Organigram began shipping its first vaporizer cartridges, and distillate pens will probably go out before the end of the month. The company also expects to start selling a line of cannabis-infused chocolates by the end of the first quarter.