Organigram currently expects Fiscal 2023 revenue to be higher than that of Fiscal 2022. This expectation is largely due to ongoing sales momentum, stronger forecasted market growth, the Company’s expanded product line in multiple segments, greater capacity to meet demand at the Moncton Campus, increased throughput at the Winnipeg facility and contributions from the Lac-Superieur facility. In addition, the anticipated continuation of shipments to Canndoc in Israel and Cannatrek and Medcan in Australia is expected to generate higher sequential revenue in Fiscal 2023 as compared to Fiscal 2022. The Company believes it is better equipped to fulfill demand in Fiscal 2023 with larger harvests expected compared to Fiscal 2022. This is supported by the new multi-year agreement with Canndoc that contemplates shipping up to 20,000 kilograms of dried flower, announced on November 17, 2022. The Company expects Q2 of Fiscal 2023 revenue to be higher than Q2 of Fiscal 2022. Adjusted gross margins: The Company expects to achieve similar adjusted gross margin rates throughout Fiscal 2023 with further cost saving initiatives being put into place to help offset anticipated price compression. Organigram has identified the following sales mix opportunities which it believes have the potential to further improve adjusted gross margins over time: International sales, which have historically attracted higher margins and are expected to represent a greater proportion of the Company’s revenue; Sales from the Holy Mountain brand, which will include several product categories, in a number of higher margin formats with national distribution on most SKUs The launch of new products across different derivative categories with expected attractive long-term margin profiles; and The larger volume of higher margin sales expected from the Lac-Superieur Facility, achievable from the increased capacity post construction. Adjusted EBITDA: The Company expects to maintain positive Adjusted EBITDA throughout Fiscal 2023. Cash flow: The Company generated positive cash flows from operating activities during Q1 Fiscal 2023, which was achieved primarily due to positive Adjusted EBITDA and a reduction to receivables. While the Company expects to continue to generate positive Adjusted EBITDA, periods when the Company achieves significant increases to sales will result in increases to receivables and this will negatively impact cash from operating activities. The Company has a $29 million capex budget for Fiscal 2023 and if completed as planned during Fiscal 2023, the Company expects to generate positive free cash flows by the end of calendar 2023.
Published first on TheFly
See the top stocks recommended by analysts >>
Read More on OGI:
