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XS Financial Inc. Surges with Record Q3 Earnings Despite Rocky Market Conditions, 2024 Holds Growth Potential

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XS Financial Inc. XSF XSHLF, a specialty finance company providing CAPEX and equipment financing solutions to cannabis companies in the U.S. has reported hearty financial performance for Q3 ending September 30th, 2023.

All figures are in U.S. dollars unless otherwise noted.

See Also: Canadian Cannabis Co. Entourage Health Q3 Revenue Slides 8.8% YoY – But Margins Sore, Losses Decline

Record-Breaking Earnings

  • The company saw an impressive 41% YoY increase in Q3 revenue, soaring to $2.9 million from $2.1 million in Q3/22.
  • Gross lease receivables saw a jaw-dropping 56% YoY surge to $113.1 million in Q3/23, up from $99.1 million in Q3/22.
  • Net distributable earnings experienced an 11% YoY uptick, reaching $209,000 in Q3/23 compared to $189,000 in Q3/22.
  • Net loss for the quarter was a mere $2,987,733 compared to a net loss of $2,417,709 for the third quarter of 2022.

Operating expenses plummeted by 41% to $1,139,266 from $1,944,168 for the same period last year, clearing a smooth path for profitability.

Other expenses for the quarter increased to $4,787,683 from $2,553,602 for the same period last year. The hiccup was mainly due to non-cash losses related to the change in fair value of derivative liabilities and a non-cash debt modification loss.

See Also: Tough Q3 For Cannabis Co. Vext Science, But Ohio Rec Market Launch Holds Promise

Positive Post-Quarter Numbers

Post-Quarter-End, XS Financial’s key metrics exhibited consistent growth and stability, depicting a promising path forward.

David Kivitz, CEO of XS Financial, conveyed, “During the third quarter, we generated record net distributable earnings of $209,594, which is a proxy for cash earnings. Looking ahead to 2024, we are focused on expanding our customer base, increasing efficiencies in operations, and optimizing our balance sheet, including refinancing our maturing debt.”

Kivitz also emphasized the company’s robust liquidity position, with $21.4 million available for drawdown on its $54 million commercial line of credit, “which provides sufficient liquidity for our business to continue exploring growth opportunities.” 

Market Soars

XSHLF’s shares were skyrocketing at 34.29% higher, at $0.047 per share at the time of writing on Tuesday afternoon, despite the turbulence in the current market scenario.

Read Next: How to Invest in Cannabis Stocks

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