Harvest Health & Recreation (OTCMKTS:HRVSF) has announced its first-quarter 2020 revenue results in which the company reported revenue of $45 million which is a 19% sequential quarter growth and 134% YoY growth.
Harvest health reports narrower net loss in Q1 2020 relative to Q4 2019
The bottom-line matched last year’s results with a net loss of $20 million or $0.07 per share which was narrower than the almost $89 million reported in Q4 2019. The company’s revenue figure topped analysts’ estimates that were holding for revenue of$43 million but missed in the net loss estimate of $0.05 per share. For FY 2019 the company posted a net loss of $175.6 million.
The improvement of Harvest Health’s revenue was primarily a result of the increase in its retail footprint. In Q1 the company added five dispensaries thus taking its total number of retail locations to around 35.
In an earnings release CEO Steve White indicated that the company which is realigning its strategy improved financials in the first quarter. He added that this is a show of the company’s objective of moving towards profitability by cutting costs and through investments in main markets such as Arizona, Pennsylvania, Maryland, and Florida.
Harvest Health stares at a cash crunch
However the company could be facing a cash crunch because at the end of 2019 the company had only $22.7 million on hand. This is almost $170 million less from the year before and could not be enough to last the company long considering in 2019 it spent around $99.6 million in daily operating activities.
It appears the company is already feeling the pinch and could offer more shares in 2020 to remain operational which means share dilution and low share prices as a result. The company is also selling its assets in California to High Times for $5 million in cash, shares as well as a $7.5 million promissory note.