KushCo has provided an indication of its financial health and the results look good. The company is dedicated to cannabis ancillary products and services, as well as the growing cannabidiol (CBD) market, and its efforts are paying off. According to data released a couple of days ago, KushCo’s preliminary, unaudited results show a revenue increase for the fiscal third-quarter that exceed its revenue from a year ago by as much as 26%. With more cannabis legalization on the way, the company is poised to experience even greater growth.
KushCo states that its third-quarter revenue would be “approximately” $27.5 million to $28 million when the final calculations are made. This is anywhere from 21% to 26% better than the $22.3 million reported for the third quarter of the previous fiscal year, with the final difference depending on the end tally. Much of that growth, according to the company, comes from an increase in sales to its top 25 customers, and KushCo predicts that the same group of customers will have accounted for 60% more in sales than a year earlier.
Nick Kovacevich, KushCo’s co-founder, Chairman and CEO, explains, “Our preliminary fiscal third quarter results demonstrate once again our continued success in penetrating many of the industry’s elite customers, including the top MSOs, LPs, and leading brands. In fact, 24 of our top 25 customers in fiscal Q2 purchased similar products again in fiscal Q3, albeit not requiring the same quantities they did in the second quarter. Although our business will continue to remain lumpy given our concentrated customer base, our focus remains on retaining our elite customers and growing them over time, not just over a single quarter. To that end, revenue to our top 25 customers is expected to increase by more than 60% year-over-year in fiscal Q3 2021.”
Kovacevich continues, “Not only are our sales to these customers continuing to grow, but the quality of the customers we are serving is also continuing to improve, as we have a much stronger book of the right customers than we did a year ago. We have spent the last three years cultivating this elite customer base, and we are even more excited by the prospect of cross-selling these customers and others with proprietary owned products, as we move closer toward the consummation of our merger with Greenlane.”