urban-gro UGRO, a fully integrated architectural design, engineering, procurement and construction management company specializing in indoor agriculture reported record first-quarter financial results.
Record first-quarter revenue of $21.1 million, representing growth of 76% compared to the prior-year period
First-quarter net loss of $(0.7) million
First-quarter Adjusted EBITDA1 of $0.4 million, our seventh consecutive positive quarter
Project backlog of contractually committed equipment and service orders with deposits received of $22.0 million as of March 31, 2022
Strong balance sheet with $27.1 million in cash and no debt
Completed buyback of $3.8 million in treasury stock
“We are off to a strong start in 2022, reflected by our record first-quarter results, which continue to demonstrate our ability to drive unparalleled value for our clients through our full suite of in-house service offerings. We grew our revenue 75% on a year-over-year basis and continued to deliver positive Adjusted EBITDA while simultaneously making key investments that are geared toward driving long-term growth and enhancing shareholder value,” said Bradley Nattrass, chairman and CEO, who added that he was “very excited about the addition of construction management services to our platform following the Emerald C.M. acquisition.”
First Quarter 2022 Financial Results
Revenue was $21.1 million in the first quarter of 2022, as compared to $12.0 million in the prior-year period, representing an increase of $9.1 million, or 76%. This increase was driven by an increase in the specification, procurement and integration of cultivation equipment tied to the growth of new and existing project contracts, as well as $3.4 million of incremental services revenue from acquisitions. Organic revenue growth was 48%, excluding contribution from the 2WR+ acquisition.
Gross profit was $4.9 million, or 23% of revenue, in the first quarter of 2022, as compared to $2.6 million, or 22% of revenue, in the prior-year period, representing an increase of $2.3 million. The increase in gross profit dollars and margin was driven by higher-margin services revenues tied to an increased focus on building out the Company’s turnkey services offering.
Operating expenses were $5.8 million in the first quarter of 2022 compared to $2.5 million in the prior-year period, representing an increase of $3.3 million. This increase in operating expenses was driven primarily by increased headcount to support both current and future demand for the Company’s solutions, continued investment in European growth, as well as costs associated with acquisitions.
Net loss was $(0.7) million, or $(0.07) per share, in the first quarter of 2022, as compared to a net loss of $(1.6) million, or a net loss per share of $(0.20), in the prior-year period, representing an improvement of $0.9 million, or $0.13 per share.
Adjusted EBITDA1 was $0.4 million in the first quarter of 2022, compared to $0.5 million in the prior-year period. Adjusted EBITDA was driven by growth in gross profit, including the contribution from the acquisition of 2WR, and fully offset by strategic investments in operating expenses to drive growth.