VANCOUVER, British Columbia—Kits Eyecare Ltd. (TSX: KITS), a leading vertically integrated eyecare provider, reported its financial results for the third quarter ended Sept. 30, 2023. The company reported that revenue increased 32 percent to $31.2 million compared to $23.6 million in the prior year period while gross profit increased 48 percent to $10.7 million compared to $7.2 million in the prior year period. "I'd like to give a big 'thank you' to the KITS team, who continue to execute upon our strategy of making eyecare easy for eyes everywhere, as we concluded another record quarter," said Roger Hardy, co-founder and CEO of KITS.

"We grew revenue by a category leading 32 percent year-over-year, expanded our gross margin by 370 basis points, kept a tight discipline around expenses and achieved our fourth consecutive quarter of positive adjusted EBITDA. We believe our business has a tremendous amount of momentum going into the holiday season as we started to see accelerating network effects and the benefit of operating in a non-discretionary category."

Third quarter financial highlights included increased revenue of 32 percent to $31.2 million compared to $23.6 million in the prior year period. The increase was primarily attributable to strong repeat customer revenue in both contact lens and eyeglasses, higher average order value and a growth in repeat eyeglass customers.

Gross profit increased 48 percent to $10.7 million compared to $7.2 million in the prior year period, while gross margin increased 370 basis points to 34.3 percent compared to 30.6 percent in the prior year period. The increase was primarily due to a reduction in promotions to prioritize higher-margin orders and capturing improved margins from returning customers.

Net income for Q3 improved to $0.5 million compared to a net loss of $0.0 million in the prior year period. The change was primarily attributable to the higher revenue and gross profit, along with an increase in foreign exchange gain during the period.

EBITDA increased 27 percent to $1.4 million compared to $1.1 million in the prior year period, while adjusted EBITDA improved to $0.6 million compared to $(0.8) million in the prior year period. The improvement in adjusted EBITDA was primarily attributable to the increase in revenue and gross profit, offset by an increase in foreign exchange loss during the period.

For the nine months ended Sept. 30, 2023, compared to the nine months ended Sept. 30, 2022, revenue increased 36 percent to $88.8 million compared to $65.4 million.

On Sept. 30, 2023, cash and cash equivalents totaled $19.3 million compared to $18.8 million on Dec. 31, 2022.