Tilray Brands, Inc. reported a net revenue of $176.9 million for the three months ended August 31, 2023, marking a 15% increase from $153.2 million in the same period of 2022. This growth was driven by a 20% rise in net cannabis revenue, which reached $70.3 million, up from $58.6 million, and a 14% increase in distribution revenue to $69.2 million from $60.6 million. Beverage alcohol revenue also saw a 17% increase, totaling $24.2 million compared to $20.7 million in the prior year.
Despite the revenue growth, Tilray reported a net loss of $55.9 million, an improvement from the $65.8 million loss in the previous year. The company’s operating loss increased to $34.4 million, up from $21.2 million, attributed to rising operating expenses, which totaled $78.6 million, a 13% increase from $69.8 million in the prior year. The gross profit for the quarter was $44.2 million, down 9% from $48.6 million, reflecting a decline in gross margins across its cannabis segment, which fell to 28% from 51% year-over-year.
Tilray's total assets increased to $4.4 billion as of August 31, 2023, up from $4.3 billion at the end of May 2023. Current assets also rose to $829.3 million, driven by an increase in inventory, which reached $232.1 million, up from $200.6 million. However, cash and cash equivalents decreased to $177.5 million from $206.6 million in the previous quarter.
Strategically, Tilray completed the acquisition of HEXO Corp. on June 22, 2023, for $93.9 million, which is expected to generate annualized pre-tax cost savings exceeding $27 million. The company also acquired the remaining 57.5% equity interest in Truss Beverage Co. for $4.2 million in contingent consideration. Additionally, Tilray entered into a purchase agreement with Anheuser-Busch to acquire craft beer brands for $85 million, which closed on September 29, 2023.
The company is implementing a $27 million synergy plan for HEXO and integrating Truss's operations to enhance profitability. However, it has also initiated a cost reduction plan targeting $30 million in savings, with $22 million achieved to date. The company continues to face challenges from price compression in the cannabis market, which impacted gross margins and overall profitability.
About Tilray Brands, Inc.
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