Germany continues to grow in importance to IM Cannabis’ sales.
IM Cannabis Corp. (CSE: IMCC) (NASDAQ: IMCC) announced that the preliminary sales results in Germany by its German subsidiary, Adjupharm GmbH (IMC Germany), for the third quarter of 2024 significantly exceeded expectations, showing a remarkable 50% increase in revenue compared to the second quarter, when IMC Germany sold about C$3.5 million.
Adjupharm GmbH distributes cannabis to pharmacies for medical cannabis patients.
The company said that the outstanding growth demonstrated the successful execution of its strategic initiatives and strong market demand for its products.
“Since April 1, one of our key objectives was to ensure a supply chain strong enough to meet the increase in demand. This preliminary 50% growth is testament, in part, to delivering on this objective,” said Oren Shuster, CEO of IMC. “We are thrilled with our Q3 performance, which not only surpassed our own targets but also highlights the dedication and hard work of our entire team.”
In August, IM Cannabis reported its second-quarter results, in which revenue surged 12% year-over-year to C$14.8 million from C$13.2 million. Sales in Germany were up 129% to C$3.5 million after the country legalized personal possession of cannabis and nonprofit marijuana clubs in April. With that new sales baseline, Germany now makes up 24% of all company revenue.
IM Cannabis also noted that since the partial legalization of cannabis in Germany came into effect in April, demand for cannabis products in pharmacies increased significantly, highlighting the importance of a robust, reliable supply chain.
Also in August, CFO Uri Birenberg said that cannabis flower sales prices increased 21% as a result of German legalization, to C$6.09 per gram. At the same time, IMC slashed operating costs during the second quarter by 29% to C$3.7 million, as the company searched for the right financial balance to achieve profitability.
Looking ahead, the company said in its August management discussion and analysis that it intends to leverage the foundation established by Adjupharm, its state-of-the-art warehouse and EU-GMP certified production facility in Germany, its vast knowledge of the cannabis market and customers’ preferences and its network of distribution partners to expand into other jurisdictions across the continent.
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