Good day, everyone, and welcome to today's Salona Earnings Call. At this time, all participants are in a listen-only mode. Please note this call is being recorded and that I will be standing by should you need any assistance. It is now my pleasure to turn today's program over to Natalya Vakhitova, Chief Financial Officer for Salona Global Medical Device Corporation.
Welcome to the third quarter earnings call for Salona Global Medical Device Corporation, listed on the TSXV under the ticker SGMD. The company is soon to be renamed to Evome Medical Technologies and will also have a new ticker, EVMT. This change is expected in the coming weeks. I would like to remind everyone that today's discussion will include forward-looking information and forward-looking statements, future-oriented financial information and non-IFRS measures regarding future events and our future financial performance. The statements reflect our views as of today only and should not be considered as representing our views for any subsequent date and except as required by law, we do not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after today, many of which are beyond our control.
The statements are also subject to material risks and uncertainties that could cause actual results to differ materially from expectations reflected in the forward-looking statements. A discussion of these risk factors is fully discussed or referred to in the company's earnings release issued this morning and in Salona Global's disclosure documents filed on EDGAR and SEDAR. During this call, we may also refer to certain non-GAAP financial measures. For information regarding our non-GAAP financials and the reconciliation of GAAP to non-GAAP measures, please also refer to our earnings release and our EDGAR and SEDAR filings. Ladies and gentlemen, allow me to introduce you to Salona Global Medical Device Corporation, Chief Executive Officer, Mike Seckler.
Thanks, Natalia, and good afternoon, everyone. I'll be covering a few important subjects today, but first, let me start with our review of the third quarter financials for three months ending September 30, 2023. I'm happy to say we are finally on the right path to turn this company around. We generated 18.5% quarter-over-quarter organic revenue growth. Perhaps more importantly, we generated positive adjusted EBITDA of almost CAD 750,000, as defined in today's news release. I also want to highlight the reduction of acquisition debt by $428,000, and that's in USD, and the extension of our loan duration to 2025, and that is for our most pressing debt obligation, and this under the agreement announced in the news release of August 8 of this year.
That said, we continue to focus on reducing and extending our short-term liabilities as a priority. That is a key part in our assessment of a pathway to resolution of the going concern issues for the company. This sets us up for our plan to grow revenues further through new product launches and international expansion, including a very exciting announcement coming tomorrow morning about a cutting-edge product that has the potential to increase our revenues in short order. So please stay tuned for more announcements from us tomorrow. Now, I joined the company at the end of June 2023, coinciding with the end of the second quarter, a difficult quarter for the company. The company had massive overhead and was not operating efficiently. It had virtually no sales growth for over a year. It had pressing debt that created a going concern for the company.
However, the assets and the customers were and are strong. And as I talked with the board, it became clear to me there was a blueprint for success for this company. Biodex is particularly a gem. It opens an opportunity for the company to launch new cutting-edge products, access new markets, and fully dive into the medical device and technology manufacturing sector. And during my first three weeks on the job, I conducted a very detailed review of every subsidiary by cost and by customer, and by early August, I had the data that I needed. And in conjunction with Michael Dalsin and Roger Greene, key shareholders and advisors and bankers, we put together a plan quickly to move profitability while at the same time accelerating the pace of bringing new products to the market.
I do want to say, while I'm grateful to the board for green-lighting the plan, I want to give them much more credit for the assets they picked to acquire. These are quality companies with significant revenue and gross profit potential. Once the plan was implemented, we saw results right away. We eliminated a significant amount in annual overhead while actually increasing sales. After cutting costs, I focused on meeting customers and making deliveries of already ordered products to increase sales immediately with key customers to drive both revenue growth and profitability.... We had more demand than we could fulfill, so we focused on prioritizing production of products with higher margins to increase, increase our gross margins from 34% to 37%. I'm proud of the new leadership team that we've put together in a relatively short period of time.
We have now achieved overhead structure that more closely resembles a scrappier, startup-minded company. As a new team, we came together to produce a quarter that we can all be proud of. The first increase in quarterly sales in over a year, and we generated positive Adjusted EBITDA. After nearly five months on the job, I do see a great future for this company. Our customers have a pressing need that we are uniquely qualified to satisfy. Physical therapy and chiropractic clinics are fixed-cost operations, and the only way they can increase their revenue and profit is to increase the ratio of therapists to patients, and the only way to do that is through more advanced technology. That is why the company will soon change its name to Evome Medical Technologies.
With the acquisition of Biodex and Simbex, we have a raft full of IPs and talent, and that is the basis for the next generation of technology that we believe will serve to increase our customers' revenues and their patients' well-being. We are focused on delivering technology that is portable, connected, and AI-enabled, all with one goal in mind: to increase the ratio of patients to therapists, thereby increasing the throughput of the clinic without additional labor costs. With that look into the future, I want to remind you that we will be making a product announcement tomorrow as promised. It's the first of many to come, and it'll be a really good example of how we plan to increase our market as we focus on growing revenues and profits, just like we did this quarter.
I want to thank you for your time today, and as is customary, Natalia Vakhitova , our new CFO, will cover details of the past quarter. Natalya?
Thank you, Mike. I'm happy to be a part of the new executive team, and I, too, see a great opportunity for increasing margins and profits as we roll out new products to a larger market. Now turning to the financial highlights for the quarter ending September 30, 2023. Organic revenue for the quarter increased 18.5% from the previous quarter to $19.6 million. This was an exciting quarter for revenue for us, and we are pleased to see the growth as it was a priority to complete the turnaround. Year-over-year, revenue increased 56% from the same period in the prior year, mainly due to the new acquisitions. Gross profit for the quarter increased 29% from the previous quarter to $7.2 million.
Again, it was an exciting quarter for gross profit growth, and we are pleased to see gross profit growth as it was a priority to complete the turnaround. year-over-year, revenue increased 78% from the same period in the prior year. As a percentage of revenue, gross profit, which is 37% for the third quarter as compared to 34% in the previous quarter. We generated $749,000 in Adjusted EBITDA for the quarter, which represents an increase of $1.5 million over the previous quarter. We generated a net income of nearly $3 million for the quarter. I do want to caution our investors that we look at Adjusted EBITDA as a better gauge of our business results than the net income, but it's nevertheless an important figure.
We are pleased to report a positive Adjusted EBITDA this quarter after a string of losses going back over a year. In terms of our balance sheet, we have been able to push out the duration of some crucial debt, and we are now assessing a potential pathway to resolve the going concern issue. We have seen that we can generate revenue growth and positive Adjusted EBITDA, and with the expectation of new products to come out, we are concentrating now our attention on the cash flow. I will now turn the call back to Mike for closing comments.
Thank you for joining us today and allowing us to update you on the progress of the turnaround and to take a look, really a glimpse, at the future of the company. There's much more to come soon. I look forward to updating you next quarter on our financial results, and please check in with us tomorrow on our new product debut. Thank you.
Thank you, ladies and gentlemen. This concludes today's program, and we appreciate your participation. You may disconnect at any time.