Flora Growth Corp.

Revenue in Q1 2024 was $18 million versus $19.3 million in Q1 2023. German sales increased to $11.3 million from $8 million. Total operating expenses were $6.3 million, down from $7.7 million, and excluding noncash impairment charges, operating expenses fell $2.3 million, or 30%. Net cash used in operating activities improved to $1.3 million from $4.3 million, and net loss was $3.4 million versus $3.9 million a year ago. Before impairment and unrealized noncash losses, operating loss was $1.6 million versus $2.4 million. The company ended the quarter with $4.2 million in cash, $21.8 million in current assets, including $9.2 million of salable inventory, and $2.4 million of net working capital. Management did not provide formal next-quarter or full-year financial guidance, but said it is focused on Germany and the U.S., expects Vessel growth over the next two quarters, and is preparing for further opportunities as German medical access expands and phase-two recreational rules develop.

Clifford Starke framed the quarter as a continuation of a turnaround that began when the team took over in June 2023, saying the company has been reshaped and is now focused on a few initiatives meant to create shareholder value. His tone was optimistic and opportunistic, centered on cannabis reform in Germany and potential U.S. rescheduling, which he described as transformational for the sector. He emphasized that Flora is positioning for both near-term medical demand and longer-term commercialization in Europe.

Dany Vaiman focused on improving financial discipline and operating efficiency. He said revenue was $18 million versus $19.3 million last year, operating expenses were $6.3 million versus $7.7 million, net cash used in operations was $1.3 million versus $4.3 million, and net loss improved to $3.4 million from $3.9 million. He also highlighted the quarter-end balance sheet, including $4.2 million in cash, $21.8 million in current assets, $9.2 million of salable inventory, and $2.4 million in net working capital. Vaiman said each operating division was at or near breakeven on continuing operations and adjusted EBITDA, with JustCBD at 41% gross margin on $5.4 million of sales and Vessel at 39% gross margin on $1.3 million of sales.

Analysts pressed management on the post-reform German opportunity, asking about sales mix by geography, patient sign-ups, and how Flora plans to capitalize as medical access improves and a recreational framework evolves. Starke said Germany is currently about 50% to 55% of revenue and that he is seeing strong medical demand, supply tightness, and a likely jump in patient activity, but he declined to give exact forward mix or formal guidance. Questions also centered on JustCBD’s product changes and the hemp beverage opportunity; management said JustCBD is being relaunched after cutting low-margin lines and resolving Florida regulatory issues, while beverages could be a major category where quality and distribution matter, though Flora is only “potentially” looking at the space. Analysts also asked about other international markets, and Starke pointed to the U.K. and France as markets he would like to see liberalize, while noting Europe as the next frontier.