CLS Holdings USA Inc. (OTCQB: CLSH) (CSE: CLSH) highlighted its financial and operational results for the third quarter of fiscal 2019, ended February 28, 2019.
The Company generated revenues of approximately $2.4 million during the third quarter, which is an improvement of 25% over the revenues of Alternative Solutions, LLC, which was a privately held company during the comparable quarter of the previous year. Alternative Solutions was acquired by CLS Holdings USA, Inc. in June 2018. The Oasis Dispensary located in Las Vegas, Nevada generated approximately $1.4 million of this amount, up 10% when compared to the revenues it generated for Alternative Solutions, LLC during the comparable period of the previous year. Gross margin at the Oasis Dispensary for the quarter finished at 39.0%, up from 22.3% when compared to the gross margin for Alternative Soutions, LLC for the same quarter of the prior year.
Strong systemwide retail revenue for the quarter is primarily attributable to the right-sizing of the Oasis Dispensary. Management has been working to increase sales through customer-focused initiatives and analyzing sales data to maximize returns on investment. While there have been one-time costs associated with reorganizing the internal structure at Oasis Dispensary, management is extremely satisfied with the team, product selection, and purchasing process that is now in place.
The City Trees brand contributed significantly to CLS’s top-line revenue growth in the quarter, generating approximately $1.0 in revenues compared to approximately $567,000 for Alternative Solutions, LLC during the comparable quarter of fiscal 2018, an 84% improvement. Gross margin for this segment also improved to 39% for the third quarter of fiscal 2019 from a gross margin for Alternative Solutions, LLC of 32.8% for the same period during the prior year. City Trees’ products are now available in 44 locations across the state of Nevada and it is becoming a well-recognized consumer brand.
Jeffrey Binder, Chairman and CEO of CLS Holdings USA, Inc. stated: ”I want to thank all of the Company’s employees who made it possible for these improved results since CLS acquired Alternative Solutions (Oasis and City Trees).”
In addition to growing revenue and increasing gross margins at its existing Oasis and City Trees locations, the Company expects to close on its CannAssist cultivation opportunity in June 2019 and on its In Good Health medical dispensary in November of 2019. The Company has invested substantial funds into the medical dispensary, which has allowed for its expansion and improved development. Both sites represent exponential revenue potential, especially given their location in Massachusetts.
Full financial results for CLS’ third quarter are set forth in its Form 10-Q, which has been filed with the Securities Exchange Commission and is available on the SEC’s EDGAR service at www.sec.gov.
About CLS Holdings USA, Inc.
CLS Holdings USA, Inc. (CLSH) is a diversified cannabis company that acts as an integrated cannabis producer and retailer through its Oasis Cannabis subsidiaries in Nevada, and plans to expand to other states.
CLS stands for ”Cannabis Life Sciences,” in recognition of the Company’s patented proprietary method of extracting various cannabinoids from the marijuana plant and converting them into products with a higher level of quality and consistency. The Company’s business model includes licensing operations, processing operations, processing facilities, sale of products, brand creation and consulting services.
About Oasis Cannabis
Oasis Cannabis has operated a cannabis dispensary in the Las Vegas market since dispensaries first opened in Nevada in 2015 and has been recognized as one of the top marijuana retailers in the state. Its location within walking distance to the Las Vegas Strip and Downtown Las Vegas in combination with its delivery service to residents allows it to efficiently serve both locals and tourists in the Las Vegas area. In February 2019, it was named ”Best Dispensary for Pot Pros” by Desert Companion Magazine.
In August 2017, the company commenced wholesale offerings of cannabis in Nevada with the launch of its City Trees brand of cannabis concentrates and cannabis-infused products.
About City Trees
Founded in 2017, City Trees is a Nevada based cannabis cultivation, production and distribution company. Offering a wide variety of products with consistent results, City Trees is one the fastest growing wholesale companies in the industry. Its products are now available at 33 dispensaries.