The increase was primarily due to the increases in selling, general and administrative expenses of $16,673, professional fees of $58,803, marketing and advertising of $13,345, research and development of $513, consulting of $328,923 offset by a decrease in amortization and depreciation of $2,905.
Our total operating expenses for the three months ended January 31, 2018 of $593,026 consisted of $84,033 of selling, general and administrative expenses, $65,043 of professional fees, consulting expense of $430,092, marketing expense of $13,345, and research and development of $513. Our general and administrative expenses consist of bank charges, telephone expenses, meals and entertainments, computer and internet expenses, postage and delivery, office supplies and other expenses.
Net Income
Our net income decreased by $278,806 to a net operating loss of $165,616 for the three months ended January 31, 201 from a net income of $113,190 for the three months ending January 31, 2017. The decrease in net income is primarily a result of the gross profit increase of $146,043, offset by an increase in operating expenses of $417,986.
Nine Months Ended January 31, 2018 Compared to Nine Months Ended January 31, 2017
Revenue
Our revenue from operations for the nine months ended January 31, 2018 was $6,006,252 compared to $2,237,405, an increase of $3,768,847 or approximately 168%, from the nine months ended October 31, 2016. This increase is due to increases of $1,771,701 in construction, $1,342,056 in advertising sales, $1,159,333 in cannabis supply sales. These increases were offset by decreases in CBD sales of $254,470 and $249,773 in e-Cig sales, as compared to the three months ended January 31, 2017.
Cost of Goods Sold
Our cost of goods sold for the nine months ended January 31, 2018 was $3,873,773 compared to $1,655,692 for the nine months ended January 31, 2017. The increase is primarily due to the increase in sales.
Gross Profit
Our gross profit for the nine months ended January 31, 2018 was $2,132,479 compared to $581,713 for the nine months ended January 31, 2017. The gross profit of $2,132,479 for the nine months ended January 31, 2017 represents approximately 35.6% as a percentage of total revenue. The gross profit of $581,713 for the nine months ended January 31, 2017 represents approximately 26.0% as a percentage of total revenue. This increase in the gross profit is primarily attributed to the increase in cannabis supply and advertising revenue with higher profit margins.
Operating Expenses
Our operating expenses increased by $949,031 to $1,340,187 for the nine months ended January 31, 2017, from $391,156 for the nine months ended January 31, 2017.
The increase was primarily due to the increases in selling, general and administrative expenses of $80,821, professional fees of $86,026, marketing and advertising of $25,503, research and development of $4,634, and consulting of $753,229.
Our total operating expenses for the nine months ended January 31, 2018 of $1,340,187 consisted of $241,786 of selling, general and administrative expenses, $106,056 of professional fees, consulting expense of $962,209, marketing expense of $25,503, and research and development of $4,634. Our general and administrative expenses consist of bank charges, telephone expenses, meals and entertainments, computer and internet expenses, postage and delivery, office supplies and other expenses.
Net Income
Our net income increased by $604,142 to $862,714 for the nine months ended January 31, 2018 from $258,572 for the nine months ending January 31, 2017. The decrease in net income is primarily a result of the gross profit increase of $1,550,766, offset by an increase in operating expenses of $949,031.
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