GoldON Resources Ltd.

Chalice reported first-quarter revenue of $5.5 million, up 18% year over year. Gross profit margin was 45% versus 37% in the prior-year period, and adjusted EBITDA was $370,000, or 7% of revenue. The company said operating costs were down 21%, retail revenue rose 20% year over year, and wholesale revenue rose 26% year over year. Management also said 6.5% of retail sales were internally cultivated flower, versus zero in Q1 2020, and Bald Peak output was running at 250 pounds per month beginning in Q2. Looking ahead, management said the company expects to remain cash flow positive and EBITDA positive, with growth supported by Homegrown, Fifth & Root, and continued acquisition activity; no formal next-quarter or full-year numeric guidance was given.

Jeff Yapp framed the quarter as proof that the turnaround is working and said the company is now vertically integrated, cash flow positive, and EBITDA positive. His strategy centered on building a stronger retail brand, using homegrown cultivation to support margins, and expanding west of the Mississippi while staying disciplined on acquisitions. He was upbeat about the cultural fit and strategic value of Homegrown and Fifth & Root, and portrayed the team as resilient and execution-focused despite industry and operating disruptions.

John Varghese highlighted record first-quarter revenue of $5.5 million, a 21% reduction in operating costs, gross margin expansion to 45% from 37%, and adjusted EBITDA of $370,000. He said the balance sheet was cleaned up, debt is now manageable, and the strengthened capital structure helped fund the Homegrown acquisition. He also noted that post-consolidation the company will have just under 63 million shares outstanding, about 5.3 million options, and total debt of $11.1 million. Varghese emphasized that Bald Peak optimization is increasing output to 250 pounds per month beginning in Q2 and said the facility can support 18 to 20 stores, versus the current 12-store footprint.

Analysts asked about the name change, the 23:1 share consolidation, the rationale for Homegrown and Fifth & Root, and whether the company intends to keep acquiring businesses. Management said the name change better aligns the corporate identity with the Chalice Farms retail brand and a broader brand architecture. On the split, they said it was needed to avoid a very large share count, improve marketability for institutional investors, and support future capital raising for accretive deals. They described Homegrown as a culturally aligned, profitable acquisition that nearly doubles store footprint and revenue, while Fifth & Root is intended to help build a nationwide commerce platform and prepare for future cannabis legalization.