Yesterday, Acology, Inc. (OTC:ACOL) reported its financial results for the quarter ending on September 30th, 2017. For those who are not so familiar with the California-based company, it is best known for its Medtainer line of cannabis packaging solutions.
While many cannabis investors are familiar with Kush Bottles, Inc. (OTC:KSHB) which also makes cannabis packaging, the two companies are capturing the cannabis packaging space from opposite ends. While Kush Bottles seems to focus on mass-distribution and wholesale supply, Acology's Medtainer products seem to target the consumer.
The Medtainer stores and grinds cannabis, making it a great product for on the go. Having partnerships with artists like Fetty Wap, and brands like Carrots has allowed the company to create unique designs which demand a far higher price point than packaging from Kush Bottles. Where as Kush Bottles' pop-top containers go for less than $1 per piece, a Medtainer starts at $8.99, and can go as high as $18.50 or more.
This patented grind-and-store container's higher price point and margins are what initially brought Acology to our attention, and now the company's recent earnings put it on our radar again.
Comments from the CEO of Acology
As mentioned in Acology CEO Curt Fairbrother's recent letter to shareholders, the company's recent quarter was a successful one. Fairbrother wrote, "Our 10Q, published yesterday, details our highest gross profit to date and we’re tracking even larger increases before the end of the year. Our gross profit increased as our product costs lowered. Acology’s balance sheet has been relieved of more than $1M in debt as our other expenses have dramatically decreased."
Fairbrother went on to say that, "Our new product lines are accounting for much of this increase in total sales and our inventories have more than doubled in preparation for the multi-billion dollar increase that’s expected from the 2018 cannabis market. In short, Acology is very well positioned for the paradigm shift that’s coming next year. As the year ends we are close to completing arrangements with EZ Health Solutions and the new markets that will open for us in the CBD line."
For the quarter ending on September 30th, 2017, ACOL had revenues of $495,185. This represents an increase of almost 3.5% when compared to the $478,852 in revenues for the same quarter in 2016.
While this year-over-year growth for the quarter may seem slim, for the nine months ending on September 30th, 2017, ACOL had revenues of $1,585,220. This represents an increase of almost 10% when compared to the $1,441,180 in revenues for the same nine months in 2016.
It should be noted that the company's cost of sales rose from $117,544 for the quarter ending on September 30th, 2016 to $155,773 for its most recent quarter. This hurt gross profits, however the company is still on track for its best year ever.
For Acology Inc.'s full 10-Q filing, click here. Be sure to subscribe to one or more of our free e-mail newsletters so you never miss an important marijuana stock update. Also, don't forget to connect with The Daily Marijuana Observer on social media via Facebook, Twitter, StockTwits, YouTube, and Instagram.