1933 Industries Inc. (CSE: TGIF)(OTCQB: TGIFF) released its unaudited interim consolidated financial statements for the third quarter ending April 30, 2024 in Canadian dollars.

1933 reported that in the third quarter, its total revenues were C$4.8 million versus C$4.0 million for the same period in 2023. The company attributed the increase to the strength of the AMA brand in Nevada and the upgrades and improvements to the cultivation facility completed in the fourth quarter of 2023.

Cash is low

The company also reported a comprehensive loss of C$142,886 for the quarter versus last year’s loss of C$2.9 million. The company’s cash is dwindling with $638,022 left at the end of the quarter versus C$1.0 million at the end of July 2023.

However, the company announced it plans to complete a private placement that could bring in C$1,800,000.  The company said in its filing that it is raising capital and reviewing various strategic options, including, M&A activity, the sale of certain company assets, and a shift in business focus.

“The increase in revenue, gross margin, and net profit this quarter is a direct result of the strategic measures undertaken over the last year to optimize our cultivation and drive operational efficiencies. While there are always challenges affecting the overall cannabis industry, the Company continues to work towards achieving sustainable profitability, and this quarter was a reliable indication that we are on the right track”, said CEO Mr. Paul Rosen.

“The AMA brand continues to enjoy robust sales in Nevada, with strong brand presence and consumer loyalty. We have been able to achieve this by building trusted relationships with both our customers and our retail clients over the years, and by providing a strong value proposition based on quality, consistency, and high touch customer service”, stated Ms. Ester Vigil, President and Director of Sales at 1933 Industries.

Going concern

1933 told investors in its filing that it has not yet achieved profitable operations and during the nine months ending April 30, 2024, and 2023. The company said it has incurred a net loss of $1,045,209 (2023 – $4,888,444). As of April 30, 2024, the company had an accumulated deficit of $96,970,701 (July 31, 2023 – $95,820,123) and a working capital of $759,274 (July 31, 2023 – working capital deficiency of $4,239,042).

CannaHemp suspended

1933 said in its filing that the company suspended its Canna Hemp CBD consumer packaged goods subsidiary while it assessed the viability of the CBD market going forward. The company said in a statement, “The market demand for hemp-infused CBD products has continued to decrease since the COVID pandemic, primarily due to increased competition, the closure of brick-and-mortar stores, and customers exiting the CBD category. The lack of federal rules on CBD products, and the grey area surrounding the introduction of psychoactive Delta 8 compounds into products under the ambiguity of the Farm Bill continue to erode the traditional CBD market and hinder future growth.”

The company owns 91% of the Alternative Medicine Association (AMA), the company’s cultivation and production subsidiary, and announced that its wholly owned subsidiary, FN Pharmaceuticals plans to buy 9% of the outstanding membership interests of AMA from the company’s former Executive VP and General Counsel, Caleb Zobrist. Upon successful completion of this transaction, FN Pharmaceuticals would own 100% of the membership interest in AMA.