Flow Beverage Corp. touted 14.3 million Canadian dollars in new investment so far this fiscal year as fuel to spur a return to growth, despite suffering a 17% year-over-year drop in consolidated net revenue.
The Canadian water company cited the exit of commercial partnerships with retail and food service partners, as well as temporary disruptions to production and fulfillment due to capital constraints as the drivers behind a 49% decrease in brand net revenue from the same period last year, falling from CA$7 million to $3.6 million. That was offset by a 28% increase in co-packing net revenue, attributable to recently secured contracts.
Adjusted EBITDA loss closed from $3 million in Q2 2025 to CA$3.5 million in Q2 2024, reflecting decreased sales and marketing expense attributable to a one-time marketing rebate, and higher salaries and benefits due to additions to the U.S. sales team.
Gross margin was 23% in Q2 2025, compared to 28% in Q2 2024.
The company highlighted its new investment as evidence that it can reduce its arrears. That includes a CA$2 million secured term note with NFS Leasing Canada Ltd., carrying 15% annual interest (no payments for first three months) and maturing in May 2028.
Earlier this month, it followed that with a further CA$4 million loan from NFS and a secured convertible loan with RI Flow LLC of up to CA$6 million.
“Our Planet A co-packing business continues to contribute positively to consolidated net revenue and gross profit,” said Nicholas Reichenbach, Flow’s Founder and CEO. “Furthermore, our operational transformation has made us a leaner and more focused operation and has resulted in an Adjusted EBITDA improvement as compared to the prior year.”
He continued: “Flow continues to see strong demand for our Flow brand products which should also be propelled by a busy summer activation program and the launch of Flow Sparkling Mineral Spring Water in Canada. The near-term commissioning of production line 5 at our Aurora production facility will also provide additional capacity to meet Flow brand demand and volumes from our Planet A co-pack partners.”
In a move indicative of its current strategic focus, the company also announced the appointment of Paul Dowdall as its new Chief Financial Officer, following the exit of Trent MacDonald from the role at the beginning of this month.
Along with recent experience in the fintech sector with a Canadian payment services start-up, Dowdall brings a CPG track record to Flow from previous stints at Ice River Springs, a bottled water manufacturer, and Diamond Estates Wines and Spirits, and has “successfully led the recapitalization and restructuring of several companies, demonstrating a strong capacity for financial stewardship in dynamic environments,” per a release.
Go Deeper: Co-Packing Drives Q1 Growth as Branded Water Business Slides