Auxly Cannabis Group (XLY) investor relations material

Executive summary

• Achieved record financial performance in 2025, with net revenue of $151.5 million, up 24% year-over-year, and $40.1 million in Q4, up 16% from Q4 2024.

• Adjusted EBITDA grew 64% to $43.8 million for the year, with a 29% margin; Q4 Adjusted EBITDA was $12.5 million, up 14% year-over-year.

• Net income for 2025 was $41.9 million, a $58.2 million improvement from 2024, with EPS of $0.03.

• Back Forty became the top cannabis brand in Canada, with leadership in dried flower, pre-rolls, and vapes; launched new premium brand South Point in Alberta and Ontario.

• Ended Q4 with $32.3 million in cash and total debt of $46 million.

Financial highlights

• Gross margin on finished cannabis inventory sold improved to 54% for 2025 and 56% in Q4.

• SG&A expenses rose 22% to $43.4 million for the year, reflecting investments to support higher sales.

• Cash flow from operations before working capital changes was $38.6 million for the year, up 129% year-over-year, representing 88% conversion from Adjusted EBITDA.

• Total assets at year-end were $272 million, up 4% year-over-year.

• Q4 net revenue was $40.1 million, a 16% increase year-over-year.

Outlook and guidance

• Expects continued growth and profitability in 2026, aiming to outpace the Canadian market's projected 5% growth.

• Plans to invest $10–12 million in 2026 to enhance quality, capacity, and international shipment capabilities at Auxly Leamington.

• Forecasts improved cash flow conversion due to reduced interest expense and stable working capital investments.

• Expects to fund innovation and capacity increases from operating cash flow and maintain profitability through cost control.

• Sees long-term growth potential in international markets and is evaluating export opportunities.