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HEXO TSX : HEXO NASDAQ : HEXO HEXO Reports First Quarter 2022 Results and Launches New Strategic Plan , " The Path Forward " to Solidify its Position as Canada's Leading Cannabis Company This news release constitutes a “ designated news release " for the purposes of the Company's prospectus supplement dates May 11 , 2021 , to its short form base shelf prospectus dated May 7 , 2021 , and amended and restated on May 25 , 2021 . All amounts are expressed in Canadian dollars unless otherwise noted . • HEXO reports $ 50.2 million in total net revenue for Q1'22 , an increase of 29 % compared to the fiscal quarter ended July 31 , 2021 ( Q4'21 ) • Maintains # 1 Market Share position in Canada 1 • Announces new strategic plan , " The Path Forward " to strengthen its balance sheet and accelerate its transformation to become a cash flow positive company within the next four quarters . 1 Based on Headset data for the quarter of August to October 2021 GATINEAU , Quebec , Dec. 14 , 2021 ( GLOBE NEWSWIRE ) -- HEXO Corp ( TSX : HEXO ; NASDAQ : HEXO ) ( " HEXO " or the " Company " ) , a leading producer of high - quality cannabis products , today reported its financial results for the fiscal quarter ended October 31 , 2021 ( Q1'22 ) , and announced " The Path Forward " , a new strategic plan to solidify itself as Canada's leading cannabis company and position it to capitalize on international opportunities . The plan utilizes HEXO's current assets , including its recent acquisitions and unique capabilities to drive accelerated growth and become cash flow positive within the next four quarters . This plan is underpinned by actions to strengthen its balance sheet , its executive team and its corporate governance . Q1 2022 Highlights • Total net revenue increased 29 % to $ 50.2 million from $ 38.7 million in Q4'21 , and up 70 % from the comparative quarter of fiscal 2021 . • The Company closed its acquisitions of Redecan and 48North which contributed net revenues of $ 13.5 Million and $ 1.1 Million respectively during the two months ended October 31 , 2022 . • The Company's total non - beverage gross margin before adjustments increased to 28 % from 25 % in the previous quarter . Revising expected synergies from acquisitions to over $ 50M from previously reported $ 35M . Forecasting positive cash flow within the next four quarters based on incremental cash flow of $ 37.5 million in fiscal 2022 and an additional $ 135 million in 2023 for a total of $ 175 million over the two years . " We are taking immediate steps through our new strategic plan , The Path Forward , to strengthen our capital position , improve operations , accelerate organic growth and complete our transformation to be cash flow positive from operations within the next four quarters , " said Scott Cooper , President & CEO , HEXO . “ Having visited all our core sites , and in meeting with our employees and customers , I am more confident than ever in HEXO's future and our ability to accelerate the creation of short and long - term value for shareholders . " The Path to Growth : A Strengthened Balance Sheet As part of its plan to ensure the Company has adequate capital to meet its requirements , it is taking immediate action to reduce the dilutive effect of its senior secured convertible note ( " Convertible Note " ) . The Company is working with investment banks , as well as its current debt holder towards a holistic solution to reduce its debt overhang . The Company is actively evaluating alternatives in a manner which maximizes shareholder value . HEXO continues to be actively engaged in positive , ongoing conversations with its senior secured note holder on potential restructuring options of the note . As of December 14 , 2021 , USD $ 118 million and USD $ 375 thousand of principal on the Convertible Note has been redeemed and converted , leaving USD $ 241.625 million of principal outstanding . The Path to Renewal : Enhanced Leadership Team The Company is making a series of executive changes to strengthen its focus on products , operations , and profitability . These decisions reflect HEXO's vision for building a best - in - class consumer packaged goods company that is on the path toward stable , long - term growth . HEXO is bolstering its focus on products by appointing Jackie Fletcher as Vice - President , Science & Technology . This strategic appointment will allow HEXO to leverage the deep expertise and bench strength from the Redecan acquisition as well as the practical application they applied to R & D . Jackie will report directly to Scott Cooper .