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Urban-gro’s revenues, losses sprout in second quarter

LAFAYETTE — Indoor cannabis agriculture engineering and dispensary design firm Urban-gro Inc. (Nasdaq: UGRO), saw both its sales and net loss grow in the second quarter of 2023.

The company posted a net loss of $5.4 million on sales of $18.8 million in the most-recent period. That’s compared with a loss of $1.7 million on sales of $16.3 million in the same period last year. 

“Our second quarter performance marked another sequential improvement in revenues and Adjusted EBITDA, and as we anticipated, our cash position improved relative to the first quarter. We remain intensely focused on returning to positive Adjusted EBITDA, and see a pathway to this through the costs we’ve driven out of the business, our increasing revenues, and a systems-enhanced insight into project margin,” Urban-gro CEO Bradley Nattrass said in a prepared statement. “Our performance was consistent with the expectations that we communicated in May, and is the product of our team’s unrelenting focus on expense optimization and working capital management.”

Urban-gro, a firm that traditionally focused on indoor agriculture engineering services for cannabis growers, has begun diversifying its offerings to include design and architectural services to help pot-shops stand out in a crowded market. 

The company accelerated its service-diversification evolution in 2021 and 2022 with the acquisitions of Houston-based engineering firm Dawson Van Orden Inc. and Georgia-headquartered 2WR+ Partners LLC, the parent company of architecture and interior design firm MJ12 Design Studio.

“Our diversification playbook continues to drive strong growth of non-CEA revenue. While we continue to see some positive signs within the cannabis industry, we are not immune to the well known pressures facing the sector,” Nattrass said in a statement. “For this reason, we continue to remain laser focused on reallocating resources and optimizing our spending where appropriate to ensure that our infrastructure is aligned with the size of our business.”

Source: BizWest