Rubicon Organics Reports Q1 2025 Financial and Operating Results

Rhea-AI Summary

Rubicon Organics (ROMJF) reported strong Q1 2025 financial results with net revenue of $12.4 million, up 39.2% year-over-year, and Adjusted EBITDA of $0.7 million. The company achieved significant market share across categories: 2.0% in flower/pre-rolls, 5.1% in premium flower/pre-rolls, and 14.7% in resin vapes. Key developments include removing conditions for the Hope Facility acquisition, which will increase production capacity by 40% (4,500 kg annually), and completing a $4.5 million private placement. The company also received GACP certification and completed its first shipment to Europe. Despite positive revenue growth, the company reported a net loss of $322,064 for Q1 2025, though this represents an improvement from the $1.89 million loss in Q1 2024.

Positive

• Net revenue increased 39.2% YoY to $12.4 million
• Achieved positive Adjusted EBITDA of $0.7 million, an improvement of $1.1 million YoY
• Gross profit margin improved to 31% from 25% in the previous year
• Secured 40% production capacity increase through Hope Facility acquisition
• Successfully raised $4.5 million through private placement
• Expanded internationally with first European shipment and GACP certification

Negative

• Posted net loss of $322,064 in Q1 2025
• Operating expenses increased to $4.3 million from $4.1 million YoY
• Cash position decreased from $9.86 million to $7.78 million during Q1
• Expects Hope Facility startup costs of over $3 million with no revenue contribution until 2026

• Achieved net revenue of $12.4 million, representing a 39.2% increase compared to the same quarter in prior year
• Generated Adjusted EBITDA¹ of $0.7 million, an improvement of $1.1 million year-over-year
• Removed conditions precedent for the purchase of the Hope Facility, advancing strategic expansion plans
• Completed a private placement for aggregate gross proceeds of $4.5 million

VANCOUVER, British Columbia, May 27, 2025 (GLOBE NEWSWIRE) -- Rubicon Organics Inc. (TSXV: ROMJ) (OTCQX: ROMJF) (“Rubicon Organics” or the “Company”) is Canada’s leading premium licensed producer focused on cultivating and selling organic certified, premium and super-premium cannabis products, today reported its financial results for the three months ended March 31, 2025 (“Q1 2025”). All amounts are expressed in Canadian dollars.

”We’re proud to deliver another strong quarter of revenue growth and profitability. Rubicon is cementing its leadership in premium organic cannabis through innovation, disciplined execution, and brand trust,” said Margaret Brodie, CEO. “With the removal of conditions for the purchase of the Hope Facility and the successful completion of our $4.5 million private placement, we are well-positioned for long-term growth, both in Canada and internationally. Our strategic priorities remain focused on disciplined growth, operational efficiency, and product innovation.”

"With 39% year-over-year revenue growth and positive Adjusted EBITDA, Q1 2025 highlights the strength of our operating model and financial discipline,” said Glen Ibbott, Interim CFO. “Our strong first quarter results, along with a robust balance sheet, and our recent capital raise, provide the foundation to support our expansion while maintaining financial flexibility.”

Q1 2025 and Subsequent Highlights:

• Achieved net revenue of $12.4 million, a 39.2% increase from the comparative prior year quarter
• Adjusted EBITDA¹ of $0.7 million
• Achieved national market share of 2.0%² in flower and pre-rolls, 5.1%² in premium flower and pre-rolls, 14.7%² in resin vapes, #5² overall for edibles with 26.7%² in premium edibles, and Wildflower continues to be the #1² topical brand in Canada at 26.6%²
• Removed remaining conditions for the Hope Facility acquisition with expected close in the near term, adding approximately 4,500 kgs of annual premium quality production, a 40% increase to the Company’s capacity, with revenue expected in the first half of 2026 and full capacity run rate achieved by the end of 2026.
• Completed a private placement for aggregate gross proceeds of $4.5 million
• Received certification of compliance with GACP standards and completed first shipment to Europe
• Won Standard Producer of the Year at Grow Up awards in May 2025
• Named industry veteran Glen Ibbott as Interim Chief Financial Officer

Who We Are

Rubicon Organics is a Canadian leader in premium, certified organic cannabis. With a vertically integrated model and strong national distribution, the company is scaling a house of trusted, high-performing brands including Simply Bare™ Organics, 1964 Supply Co.™, Wildflower™, and Homestead Cannabis Supply™.

The Company’s focus on premium quality, innovation, and operational execution has driven consistent growth, with Q1 2025 revenue up 39% year-over-year and positive Adjusted EBITDA for the fourth consecutive quarter and for eight of the last nine quarters.

The Company’s production base is anchored by its fully licensed Delta Facility, expected to be complemented by the planned acquisition of the Hope Facility which will expand production capacity by over 40% and support future growth in both domestic and export markets. With proprietary genetics, award-winning products, and certifications enabling international distribution, Rubicon is positioned at the forefront of the premium cannabis segment.

As the Canadian market rationalizes and global demand for high-quality cannabis increases, Rubicon’s disciplined execution, brand equity, and consumer loyalty set it apart. The company is well-capitalized following a recent $4.5M financing and is on track for continued revenue and Adjusted EBITDA expansion.

Rubicon Organics represents a rare combination of category leadership, operational strength, and long-term growth potential.

Where We Are Going: 2025 Outlook

Securing Additional Premium Quality Supply

With growing demand for Canadian cannabis from the domestic and international markets, we see that controlling access to premium quality supply is critical to continue to grow our brands and gross revenue. Our Delta Facility is fully operational and has annual production capacity of 11,000 kg. We are continuously evaluating ways to improve both our yield and quality at the Delta Facility and are in the trial stage of evaluating additional lighting at site.

In order to increase our supply of premium flower, we are acquiring the Hope Facility to significantly expand our annual production capacity, adding an annual production capacity of 4,500 kg, representing more than a 40% increase compared with our current annual production capacity from the Delta Facility, bringing total annual production capacity to 15,500 kg of premium cannabis. On May 21, 2025, we announced the removal of all conditions precedent related to the purchase and sale agreement for the Hope Facility. This acquisition is expected to close in Q2 2025. Pending licensing timing expected sometime in the summer, we expect to be running at full capacity by the end of the year. While we plan to outlay just over $3 million in operating startup costs during 2025, we do not expect revenue contribution until 2026.

Our 2024 net revenue growth was driven through strategic partnerships with co-manufacturers and contract growers and these arrangements are expected to provide up to 2,000 kgs of incremental biomass to our business in 2025. We plan to continue to collaborate with our trusted partners and explore additional partnerships as we strive to meet the growing demand for our high-quality premium products.

Building Trust with our Customers in Canada

We are committed to the growing Canadian cannabis market and to being a trusted partner for our customers—including provincial distributors, retailers, and consumers. As the Canadian customers face increasing competition from international demand, we have seen many mainstream and premium licensed producers shifting their sales abroad. We see this as a prime opportunity to further strengthen our brand presence in Canada.

With SKU rationalization underway across several provinces, suppliers are being evaluated on reliability and sales performance. This shift is raising the bar for market entry, making it increasingly challenging for new brands and products to secure shelf space. At the same time, Canadian consumers are becoming more brand-loyal, prioritizing trust and value in their purchasing decisions. We believe our award-winning brands and diverse product portfolio will continue to resonate with them.

Looking ahead, we anticipate a continued highly competitive retail landscape. However, Rubicon’s strong brand recognition, consumer loyalty, high supplier ratings, and strategic positioning provide a solid foundation for long-term success in Canada.

Genetics

We possess unique intellectual property in cannabis genetics, which we consider a critical asset in maintaining our position as a leading innovator within the industry. Our extensive genetics library is central to our strategy of delivering consistent, high-quality genetics and new product offerings for the premium and super-premium markets. We view this as a significant competitive advantage and plan to launch exciting new genetics throughout 2025. To date, we have launched BC Organic Pink Drip and BC Organic Sunset Runtz under the Simply Bare brand.

International

Our strong reputation in Canada has attracted an increasing number of inquiries from international medical cannabis buyers. The international cannabis market has experienced significant growth in recent years, with continued expansion anticipated. While the market is still in the early stages of adopting premium cannabis products, we aim to meet small amounts of the international demand with a test and learn strategy in 2025 making sure to meet our Canadian customer needs as a priority. The Company holds the necessary certifications for international exports and made its inaugural international test shipment in the first quarter of 2025.

Financial Growth

For 2025, we are forecasting growth in both net revenue and Adjusted EBITDA, excluding acquisition-related and start up operational costs associated with the Hope Facility (the “Hope Costs”), driven by our ongoing expansion and strategic initiatives. While we anticipate strong underlying performance in 2025, we expect the Hope Costs will impact our reported financial results. Despite the potential short-term impact of the Hope Costs on profitability, we are confident that our continued growth in net revenue and improved like-for-like Adjusted EBITDA will position us for long-term success and value creation.

2025 Results of Operations:

	Three months ended
	March 31, 2025 $		March 31, 2024 $
Net revenue	12,376,056		8,890,417
Production costs	2,901,783		2,692,692
Inventory expensed to cost of sales	5,368,642		3,737,334
Inventory written off or provided for	318,278		266,039
Gross profit before fair value adjustments	3,787,353		2,194,352
Gross profit % before fair value adjustments	31%		25%
Fair value adjustments to cannabis plants, inventory sold, and other charges	439,650		164,252
Gross profit	4,227,003		2,358,604
Operating expenses	4,337,795		4,097,090
Profit / (loss) from operations	(110,792	)	(1,738,486	)
Other expenses	211,272		153,856
Net profit / (loss) for the period	(322,064	)	(1,892,342	)
Net profit / (loss) per share, basic	(0.01	)	(0.03	)
Weighted average number of shares outstanding, basic	58,608,210		56,662,430

	March 31, 2025 $		December 31, 2024 $
Cash and cash equivalents	7,780,884		9,857,264
Accounts receivable	5,672,723		5,828,001
Inventories	12,377,580		10,735,739
Other current assets	4,269,347		4,230,818
Total current assets	30,100,534		30,651,822
Property, plant and equipment	22,869,365		23,493,973
Other non-current assets	2,447,643		2,465,526
Total assets	55,417,542		56,611,321
Accounts payable and accrued liabilities	8,083,309		9,263,231
Current portion of loans and borrowings	1,324,419		1,321,678
Other current liabilities	122,033		121,661
Total current liabilities	9,529,761		10,706,570
Non-current portion of loans and borrowings	8,297,436		8,478,439
Other non-current liabilities	6,151		24,151
Total liabilities	17,833,348		19,209,160
Total shareholders equity	37,584,194		37,402,161
Working capital	20,570,773		19,945,252

	Three months ended
	March 31, 2025 $		March 31, 2024 $
Changes in non-cash working capital items	(1,646,116	)	(423,346	)
Other operating activities	683,895		(435,811	)
Cash used in operating activities	(962,221	)	(859,157	)
Purchase of property, plant and equipment	(731,081	)	(384,004	)
Cash used in investing activities	(731,081	)	(384,004	)
Principal and interest paid	(355,869	)	(385,800	)
Other financing activities	(24,801	)	(17,395	)
Cash used in financing activities	(380,670	)	(403,195	)
Effect of exchange rate changes on cash	(2,408	)	(16,699	)
Increase (decrease) in cash during the period	(2,076,380	)	(1,663,055	)
Cash, beginning of period	9,857,264		9,784,190
Cash, end of period	7,780,884		8,121,135

Conference Call

The Company will be hosting a conference call to discuss Q1 2025 results on Wednesday, May 28, 2025.

Conference call details are as follows:

Time:	7:00 AM PT / 10:00 AM ET
Conference ID:	34244
Local dial-in:	+1 (289) 514 5100
Toll Free N. America:	+1 (800) 717 1738
Webcast:	Rubicon Organics Q1 2025 Earnings Call Registration

CONTACT INFORMATION

Margaret Brodie
CEO
Phone: +1 (437) 929-1964
Email: ir@rubiconorganics.com

The TSX Venture Exchange or its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) does not accept responsibility for the adequacy or accuracy of this press release.

Non-GAAP Financial Measures

This press release contains certain financial performance measures that are not recognized or defined under IFRS (“Non-GAAP Measures”) including, but not limited to, “Adjusted EBITDA”. As a result, this data may not be comparable to data presented by other companies.

The Company believes that these Non-GAAP Measures are useful indicators of operating performance and are specifically used by management to assess the financial and operational performance of the Company as well as its liquidity. Accordingly, they should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. For more information, please refer to the “Selected Financial Information” section in the MD&A for the year ended December 31, 2024, which is available on SEDAR+ at www.sedarplus.ca.

Adjusted EBITDA

Below is the Company’s quantitative reconciliation of Adjusted EBITDA calculated as earnings (losses) from operations before interest, tax, depreciation and amortization, share-based compensation expense, and fair value changes. The following table presents the Company’s reconciliation of Adjusted EBITDA to the most comparable IFRS financial measure for the three months ended March 31, 2025, March 31, 2024, and December 31, 2024.

	Three months ended
	March 31, 2025		March 31, 2024		December 31, 2024
	$		$		$
Profit (loss) from operations	(110,792	)	(1,738,486	)	292,368
IFRS fair value accounting related to cannabis plants and inventory	(439,650	)	(164,252	)	(54,271	)
	(550,442	)	(1,902,737	)	238,097
Depreciation and amortization	764,237		776,680		852,366
Share-based compensation expense	504,097		702,846		538,575
Adjusted EBITDA*	717,892		(423,212	)	1,629,038
*Included in Adjusted EBITDA in the three months ended March 31, 2025, is $0.2 million of one-time costs incurred for the ERP implementation project

Cautionary Statement Regarding Forward Looking Information

This press release contains forward-looking information within the meaning of applicable securities laws. All statements that are not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections, objectives, assumptions, expectations or beliefs of future performance, statements regarding Rubicon Organics' goal of achieving industry leading profitability are "forward-looking statements". Forward-looking information can be identified by the use of words such as “will” or variations of such word or statements that certain actions, events or results "will" be taken, occur or be achieved.

Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward looking statements. The forward-looking information in this press release is based upon certain assumptions that management considers reasonable in the circumstances, including the impact on revenue of new products and brands entering the market, and the timing of achieve Adjusted EBITDA¹ profitability and cashflow positive. Risks and uncertainties associated with the forward looking information in this press release include, among others, dependence on obtaining and maintaining regulatory approvals, including acquiring and renewing federal, provincial, local or other licenses and any inability to obtain all necessary governmental approvals licenses and permits for construction at its facilities in a timely manner; regulatory or political change such as changes in applicable laws and regulations, including bureaucratic delays or inefficiencies or any other reasons; any other factors or developments which may hinder market growth; Rubicon Organics' limited operating history and lack of historical profits; reliance on management; and the effect of capital market conditions and other factors on capital availability; competition, including from more established or better financed competitors; and the need to secure and maintain corporate alliances and partnerships, including with customers and suppliers; and those factors identified under the heading "Risk Factors" in Rubicon Organic’s annual information form dated April 1, 2025 filed with Canadian provincial securities regulatory authorities.

These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. Although Rubicon Organics has attempted to identify important risk factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other risk factors that cause actions, events or results to differ from those anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. Rubicon Organics assumes no obligation to update any forward-looking statement, even if new information becomes available as a result of future events, new information or for any other reason except as required by law.

We have made numerous assumptions about the forward-looking statements and information contained herein, including among other things, assumptions about: optimizing yield, achieving revenue growth, increasing gross profit, operating cashflow and Adjusted EBITDA¹ profitability. Even though the management of Rubicon Organics believes that the assumptions made, and the expectations represented by such statements or information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in forward-looking statements. Investors are cautioned against undue reliance on forward-looking statements or information. Forward-looking statements and information are designed to help readers understand management's current views of our near and longer term prospects and may not be appropriate for other purposes. Rubicon Organics assumes no obligation to update any forward-looking statement, even if new information becomes available as a result of future events, changes in assumptions, new information or for any other reason except as required by law.

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¹ Adjusted EBITDA is a non-GAAP measure that is calculated as earnings (losses) from operations before interest, tax, depreciation and amortization, share-based compensation expense, and fair value changes. See Selected Financial Information for details on the Adjusted EBITDA calculation.
² All retail data is sourced from Hifyre as at March 31, 2025 for current year and as at March 31, 2024 for prior year

FAQ

What were Rubicon Organics (ROMJF) key financial results for Q1 2025?

In Q1 2025, Rubicon Organics reported net revenue of $12.4 million (up 39.2% YoY), Adjusted EBITDA of $0.7 million, and a net loss of $322,064. Gross profit margin improved to 31% from 25% in the previous year.

How will the Hope Facility acquisition impact Rubicon Organics' production capacity?

The Hope Facility acquisition will increase Rubicon's annual production capacity by 4,500 kg (40% increase), bringing total capacity to 15,500 kg. Revenue contribution is expected in 2026 after $3 million in startup costs during 2025.

What is Rubicon Organics' (ROMJF) current market share in Canada?

Rubicon holds 2.0% market share in flower/pre-rolls, 5.1% in premium flower/pre-rolls, 14.7% in resin vapes, ranks #5 in edibles with 26.7% in premium segment, and their Wildflower brand is #1 in topicals with 26.6% market share.

What international expansion progress has ROMJF made in Q1 2025?

Rubicon received GACP certification and completed its first shipment to Europe in Q1 2025, marking its entry into international markets with a test-and-learn strategy while prioritizing Canadian customer needs.

How much capital did Rubicon Organics raise in their recent private placement?

Rubicon Organics completed a private placement for aggregate gross proceeds of $4.5 million to support their expansion plans and maintain financial flexibility.