Investments Mernova Continues Strong Progress in Q1 FY24

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Mernova Continues Strong Progress in Q1 FY24

Mernova Continues Strong Progress in Q1 FY24

Melodiol Global Health Limited (ASX:ME1) (‘Melodiol’ or ‘the Company’) is pleased to advise that wholly- owned Canadian subsidiary, Mernova Medicinal Inc. (‘Mernova’) has achieved further operational milestones during Q1 FY24.


Highlights:

  • 6 different provincial markets to range new ‘Ritual’ branded products
  • Ongoing cost optimisation initiatives have identified opportunities which are expected to remove ~A$400k in annual expenses from the business and will be fully implemented by the end of Q2 FY24
  • Over A$1m in confirmed POs during Q1 FY24 through the ongoing sale of cannabis
  • Strong start to Q1 FY24 follows record divisional revenue of A$2.13m in Q4 FY23
  • Mernova’s FY23 revenue contributions assisted Melodiol in achieving record FY23 revenue of A$21.5m – a 141% rise on FY22
Mernova has successfully reached agreements to range new stock keeping units (“SKUs”) in 6 different provincial markets. Each of these new SKUs are in addition to existing SKUs in the various markets:
  • Nova Scotia Liquor Commission has accepted Halifax Sage 3×0.5g Pre-rolled joints and Sugar Bomb punch 1g vaporizers with an early April launch
  • Newfoundland Labrador Liquor Commission will be launching three new SKUs on February 14: Halifax Sage 3×0.5g Pre-rolled Joints, Black Mamba 1g vaporisers and Black Mamba 10×0.5g Pre- rolled joints
  • Alberta Gaming and Liquor Commission will be launching Sugar Bomb Punch 1g vaporisers by the end of February
  • Ontario Cannabis Store has accepted three new SKUs with an early April launch date: Sacred Sage 3.5g dried flower, Sacred Sage 3×0.5g Pre-rolled Joints, and Sugar Bomb Punch 1g vaporisers
  • New Brunswick has accepted 3×0.5g Halifax Sage Pre-rolled joints
  • Manitoba Liquor Commission will be ordering Sugar Bomb Punch 1g vaporisers and Black Mamba Bubble Hash Infused Blunt at the end of February

These ranges demonstrate Mernova’s management’s ability both to further penetrate existing markets, and conduct new product development to further growth. Mernova has grown a strong reputation in the Canadian marketplace, and is confident these new ranges will assist the Company in continuing the strong growth that has been demonstrated over the last several quarters.

Additionally, management has been focused on reducing operating costs. Opportunities have been identified and acted upon in multiple areas such as optimising shipping costs, reducing labour associated with using labelling equipment automation, removing underutilised office leases, utilising third-party warehousing to store and ship products, and other ongoing streamlining processes. These initiatives are expected to remove ~A$400k in annual operating expenses from the business and will be fully implemented by the end of Q2 FY2024.

Finally, Mernova has A$1m+ in confirmed POs to-date during Q1 FY2024. This lays a strong foundation for the operating division to continue its growth trajectory.

The strong start to the three-month period follows the division’s Q4 FY23 record unaudited revenue of A$2.13m. Mernova’s performance also assisted the Company achieve unaudited group revenue of A$21,577,431 during FY23, a record for the Melodiol. Total FY23 revenue also marked a 141% rise on the previous corresponding period (FY22: $8,950,259).

Management commentary:

CEO and Managing Director, Mr William Lay said: “I’m very excited by the ranging of new products across various provincial markets in Canada. This achievement is a testament to the strong reputation Mernova has for quality in the market, and management’s ability to develop new products. With further penetration into existing markets, Mernova has an opportunity to continue its impressive growth trajectory.”

Click here for the full ASX Release

This article includes content from Melodiol Global Health, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.

INN

Source : https://investingnews.com/mernova-continues-strong-progress-in-q1-fy24/

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