Hill Street Beverage Company Inc (CVE:BEER) (OTCMKTS:HSEEF) on Tuesday reported fiscal 2019 year-end financial results, noting a healthy increase in revenue year-over-year.
The Toronto-based company also said it closed its fiscal year, ended June 30, with working capital of C$1.880 million, compared with C$1.455 million for the same period last year. And it ended with a cash position of C$1.068 million and no debt.
Hill Street said it produced gross revenue of C$2.432 million, up 61% year-over-year. Net revenue was C$1.280 million, nearly doubling from 2018.
READ: Hill Street Beverage talking with third-party canning and bottling services following canceled acquisition of OneLeaf Cannabis
The company sells non-alcoholic beer and wine in North American but is looking to produce cannabis-infused beverages as well.
"With cannabis edibles legal earlier this month in Canada, Hill Street continues to grow its brand awareness and consumer offtake in the alcohol free beverage segment," said CEO Terry Donnelly in a statement. "All of the alcohol free revenue earned during the year came from growing our retail and distribution channels. Operational improvements made in FY18 began to show the results we anticipated.”
Donnelly noted that going forward, the company is evaluating third-party bottling and canning companies that have facilities designed and licensed to produce cannabis beverages.
“We are confident that Hill Street's alcohol-free and cannabis-infused business model will materialize as expected over the next 12 months,” he said.
That said, Hill Street is proceeding on to the next stage -- infusing its beverages with cannabis.
The company’s license agreement with Lexaria Bioscience Corp (CSE:LXX) (OTCMKTS:LXRP) provides it with access to technology to render cannabis into an odorless and tasteless water-soluble powder which can then be added to its alcohol-free beverages.
Hill Street said it believes that the cannabis-infused beverage segment can best be described as three distinct categories: "Heighten" (adult recreational use); "Help" (therapeutic or functional beverages); and "Heal" (medicinal or prescription beverages).
“We intend to produce, market and sell beverages for the adult use and therapeutic or functional beverage categories,” the company said.
Hill Street’s stock recently traded up 9.5% to US$0.06 on the OTC markets but was flat at C$0.07 in Canada.
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