Surna posts loss as revenue shrinks by 60%

BOULDER — The second quarter was a tough one for Surna Inc. (OTCQB: SRNA), a Boulder-based manufacturer of growhouse equipment for the cannabis industry. During the period, the firm, which posted its Q2 earnings Tuesday, saw revenues shrink by 60%, furloughs, salary reductions and operational cost-cutting measures.  Surna tallied nearly $1.7 million in sales for the quarter, down from $4.2 million in the same period in 2019. The firm posted a $614,000 net loss in Q2 compared to a $140,000 profit in the second quarter last year. Tuesday’s earnings report sent Surna’s stock spiraling to $0.032, down nearly 33% on the day. “Most recently, the response to this coronavirus pandemic by federal, state and local governments in the U.S. has resulted in significant market and business disruptions across many industries and affecting businesses of all sizes,” according to Surna’s earnings report. “This pandemic has also further tightened capital access for most businesses. The full extent to which COVID-19 will impact our business and financial results will depend on future developments, which are uncertain and cannot be predicted at this time.” If Surna’s clients can’t access capital to take on new projects and Surna is unable to boost revenues, “we may not be able to continue our operations,” the disclosure said.  Despite these concerns, the firm has reason for optimism heading into Q3.  Surna announced last week that it has booked a new $2.8 million contract, the richest in the firm’s history. “Despite a difficult second quarter, Surna has continued to market, sell, engineer, manufacture and ship to deliver on our project commitments. And while we, and indeed the entire world economy, are weathering unpredictable and unprecedented times, we are very encouraged by the new sales contracts we have booked since the beginning of the third quarter,” Surna CEO Tony McDonald said in a prepared statement. “The $3.1 million in new sales contracts, coming in just the first month of the quarter, already marks the third quarter of 2020 as among the strongest in our company’s recent history.”   © 2020 BizWest Media LLC
Source: BizWest