MediPharm Labs (LABS) Q1 2025 earnings summary

Executive summary

• Achieved significant improvement in financial performance, with positive adjusted EBITDA for the first time in over five years and the highest gross margin in many years.

• Net revenue for Q1 2025 increased to CAD 10.8 million from CAD 9.8 million in Q1 2024, driven by international sales growth.

• International medical cannabis business now represents over 50% of total revenues, with strong growth in Germany, Australia, and the U.K.

• Successfully integrated the VIVO acquisition, expanding the international platform and diversifying revenue streams.

• Maintains a strong balance sheet, virtually no debt, and full ownership of three production facilities.

Financial highlights

• Q1 2025 revenue was CAD 10.8 million, up 10.6% year-over-year; gross profit reached CAD 4.2 million (38.7% margin), up from CAD 2.7 million (27.4%) in Q1 2024.

• International medical cannabis revenue grew 87% year-over-year to CAD 5.9 million, now 55% of total revenue.

• Adjusted EBITDA was positive CAD 141,000, a CAD 1.1 million improvement from the prior year.

• General and administrative expenses decreased 29% year-over-year to CAD 3 million; share-based compensation expense decreased to CAD 437,000 from CAD 895,000.

• Cash balance at quarter-end was CAD 8.4 million, with investments in inventory to support international growth.

Outlook and guidance

• Expects continued growth in international business through existing channels, new markets, and new customers.

• Management anticipates positive EBITDA trend to continue, though with potential quarter-to-quarter variability.

• Plans to maintain working capital levels to respond quickly to growth opportunities.

• Sale of non-core assets expected to strengthen liquidity in the next twelve months.