#Canada #Calgary #Decibel Cannabis #Canadian Cannabis #AgMedica

Decibel Cannabis Company Reports First Quarter Results

On May 22, 2025, Decibel Cannabis Company Inc. announced its unaudited financial results for the three months concluding on March 31, 2025. Known for its premium cannabis offerings, Decibel is poised for significant growth following its recent strategic acquisition of AgMedica Bioscience Inc.

Financial Overview

For the first quarter of 2025, Decibel reported a net revenue of $21.2 million, reflecting a modest year-over-year increase of 1.4%. The growth was notably supported by revenues from its acquisition of AgMedica, contributing $3.4 million of total sales.

Benjamin Sze, the company’s CEO, highlighted the firm’s innovation-driven initiatives, especially in newly launched products such as ultra-high potency vapes and milled flower, indicating a positive response from consumers and retailers. “Our focus on innovation is gaining traction and reversing earlier market share declines,” he stated.

The company successfully reduced its payables and debt by $2.5 million and $0.8 million, respectively, underscoring its commitment to developing a robust financial foundation. Decibel aims to bolster its cash flow and enhance its balance sheet moving forward.

Q1 Highlights

In detail, Decibel's Canadian recreational sales totaled $19 million, witnessing an 8% decrease compared to the previous year, primarily due to increased competition in infused pre-roll products. To counter this decline, Decibel plans to launch additional offerings and enhance its marketing campaigns for a wider audience.

In stark contrast, international sales experienced a remarkable surge of 527% to reach $2.2 million, mainly driven by contributions from AgMedica. Although Decibel has secured several export contracts for its products, the realization of revenue has faced challenges due to operational delays and regulatory issues.

The gross margin before fair value adjustments for Q1 stood at 50%, improving from 48% in the same quarter last year, while the adjusted EBITDA was noted at $3.5 million. Comparatively, this reflected a slight decrease attributed to elevated selling, general and administrative expenses due to the acquisition.

Further, the company recorded an adjusted net loss of $0.1 million, which signifies a year-over-year improvement, showcasing Decibel’s enhanced operational efficiency.

Future Outlook

Looking ahead, Decibel projects full-year revenues to reach $130 million, supported by its ongoing international growth and product innovation strategies. The intent is to increase exports to nine markets from the current seven, further expanding Decibel’s global footprint in the cannabis industry.

The adjusted free cash flow is projected to be $20 million, with the company also aiming to maintain a debt-to-adjusted EBITDA ratio below 1.4x to strategically manage financial obligations. This approach resonates with Decibel's ambition to navigate challenges while pursuing sustainable growth.

Conclusion

Decibel Cannabis Company’s first-quarter results emphasize its potential for recovery and growth within the competitive cannabis market. With an innovative product lineup and a clear focus on financial stability, Decibel is set to enhance its operational capabilities. Moving forward, the company’s commitment to expanding both domestically and internationally remains crucial to its long-term success. Stakeholders and investors will likely see Decibel as a promising player in the cannabis sector as it undertakes proactive measures to strengthen its market presence and financial health.