Growlife Inc. (OTCMKTS:PHOT)
Shares of Growlife Inc. (OTCMKTS:PHOT) gained 24.4% as investors reacted to the company’s third quarter financial results. Gross revenue in the quarter was up 231% compared to the same period period last year as Gross Margin increased 18%.
Q3 Financial Results
According to the Chief Executive, Marco Hegyi, the third quarter financial results underscore year-over-year growth. The company is currently working on a five-pillar strategy that is expected to accelerate growth going forward.
Net revenue for the three months ended September 30, 2017, increased by $461,000 to $661,000 compared to $200,000 reported last year. Gross profit came in at $185 000 compared to $21,000 reported last year. Growlife Inc. (OTCMKTS:PHOT) attributes the increase in gross profit to an increase in sales, offset by lower costs of sales.
“Results are what matter and the GrowLife team continues to perform in a unified manner where it is firing on all cylinders with sales, finance, and operations aligned. With the recent additions of world-class talent, resources, and further regulatory approval, I expect GrowLife to continue to lead in growth and capitalize on the demand from the indoor cultivation industry,” said Mr. Hegyi.
General and Administrative expenses in the quarter totaled $589,000 compared to $438,000 for Q3 2016. Net loss for the three months totaled (-$756,000) compared to $474,000 reported last year. The net loss included non-cash expense of $407,000.
The stock is currently trading in an uptrend despite the wider than expected Q3 net loss. However, Growlife Inc. (OTCMKTS:PHOT) is still a shadow of itself in the market taking into consideration January trading levels. The stock has shed more than 50% in market value since the start of the year.
Separately, Growlife Inc. (OTCMKTS:PHOT) has completed the acquisition of 51% of assets from a tile flooring business that is aligned with its core business competencies. The assets that the company has acquired include, intellectual property rights, FreeFit patents, copyrights and trademarks associated with the technology.
“This asset purchase provides us with new ways to engage our customers with state-of-the-art environmentally friendly building materials that we believe can help indoor cultivators lower the production cost of growing crops indoors,” said Mr. CEO Hegyi.
In addition to the acquisitions, David Reichwein, inventor of a patent pending luminous tile technology, is to join Growlife Inc. (OTCMKTS:PHOT) as the Vice President of Research and Development.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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