Safe Harbor Financial (SHFS), a leading provider of financial services and credit solutions for the cannabis industry, announced impressive financial results for the second quarter and six months ended June 30, 2024. Despite experiencing a slight decline in revenue, the company achieved a significant turnaround in net income, driven by a strategic focus on operational efficiency and cost optimization.
During the second quarter, Safe Harbor’s revenue reached $4 million, compared to $4.6 million in the same period last year. However, the company’s net income surged to $0.9 million, a remarkable improvement from a net loss of $17.6 million in the previous year. This dramatic turnaround was attributed to a sharp reduction in operating expenses, which fell from $22.5 million in the second quarter of 2023 to $3.7 million in the current quarter.
The company’s adjusted EBITDA also demonstrated positive momentum, increasing by 14.5% to $0.97 million in the second quarter, compared to $0.85 million in the same period last year. For the six-month period, adjusted EBITDA surged by 63.5% to $2.06 million, reflecting the company’s success in streamlining operations and focusing on higher-margin financial products.
Safe Harbor’s robust recovery extended to the first half of 2024. Net income for the six-month period climbed to $3 million, a significant improvement from a net loss of $19 million in the first half of 2023. Although revenue for the first six months stood at $8.1 million, slightly lower than the $8.8 million reported in the previous year, operating expenses were considerably lower at $7.5 million compared to $28.3 million in the first half of 2023.
Sundie Seefried, CEO of Safe Harbor Financial, attributed the company’s improved results to strategic shifts towards higher-margin products and the successful implementation of its lending platform. The lending platform achieved a record quarterly loan income of $1.8 million, a remarkable increase of over 203% year-over-year.
“During the quarter, we experienced strength across our business, as well as operated more efficiently, both of which contributed meaningfully to our strong results,” stated Seefried in a press release. She also highlighted the launch of the Small Business Line of Credit Program, designed to provide capital support to small and mid-sized cannabis businesses and diversify Safe Harbor’s income streams.
Safe Harbor’s operational highlights include the successful recovery of a $3.1 million defaulted loan, fully recouping the principal, and a new partnership with BIPOCann, aimed at empowering minority-owned cannabis businesses.
SHFS’s shares closed 2.44% higher at $0.6249 per share on Wednesday. The company’s strong earnings report and strategic initiatives are likely to continue to drive positive momentum in the coming quarters.
