News Release

Auxly Furthers Manufacturing Optimization Plan and Related Cost Savings Initiatives

TORONTO, May 30, 2023 /PRNewswire/ – Auxly Cannabis Group Inc. (TSX: XLY) (OTCQB: CBWTF) (“Auxly” or the “Company“), a leading consumer packaged goods company in the cannabis products market, announced today that it has transitioned all remaining dried flower and pre-roll cannabis product manufacturing, processing and distribution activities from its Auxly Ottawa facility to Auxly Leamington, where these activities are already taking place. Auxly will continue to wind-down its Auxly Ottawa facility in an orderly manner and intends to sell Auxly Ottawa’s assets in due course and apply the proceeds from any such sale to support its ongoing operations.   

Auxly continues to focus its efforts on streamlining assets, simplifying operations, reducing costs, and achieving its 2023 goals of:

  • increasing net revenues by 15% with a focus on key product categories;
  • continuing to leverage Auxly Leamington’s large-scale, low-cost cultivation facility and its manufacturing automation to improve blended Cost of Finished Cannabis Inventory Sold Margin to an average of 35-40%;
  • vigorously managing SG&A as a percentage of net revenues to keep it below 40%; and
  • prudently managing the Company’s balance sheet.

This strategic decision comes after careful consideration in identifying opportunities to optimize operations and effectively reduce operating costs, while increasing product quality and ensuring no material impact on the Company’s manufacturing capabilities and forecasted sales revenue.

Read full release on Newswire here.