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Good morning, ladies and gentlemen, and welcome to the MAV Beauty Brands First Quarter 2023 Earnings Call. [Operator Instructions] This call is being recorded on Thursday, May 11, 2023. I would now like to turn the conference over to Craig Armitage. Please go ahead.
Thank you, and good morning, everyone. Thanks for joining us. I'll just make a few quick notes before we get started. The remarks today may provide certain information regarding our expectations, future plans and intentions that may constitute forward-looking statements. I refer you to the most recently filed AIF and the MD&A for the first quarter, which are available on our website and on SEDAR. These include a summary of the significant assumptions underlying these forward-looking statements and the risks that could affect the company's performance and the ability to deliver on these forward-looking statements. You'll also find the Q1 earnings release, financial statements and MD&A on the IR section of the website. Lastly, I'd highlight that the financial discussion today largely compares Q1 2023 versus Q1 2022, unless we state otherwise. With that, I'll turn it over to Serge.
Thank you, Craig. Good morning, and welcome to MAV's first quarter conference call. I'm joined by Laurel Mackay-Lee, our Chief Financial Officer. I will briefly cover the operational results before Laurel covers the financial highlights. For the challenging first quarter, from a sales perspective, Q1 revenue was down 9% year-over-year to $19.3 million. These results reflect the continuing impact of distribution losses and broader macroeconomic challenges, notably higher interest rates. As previously disclosed, we're experiencing further distribution losses in 2023, mainly in the U.S. mass and drug channel. Continued [ e-commerce ] growth was not enough to offset these declines. With regard to brand performance, [ 2 of our brands ] were positive year-over-year, one was flat and one showed strong decline in line with reduced footprint in the U.S. Mass channel. As we work to stabilize our total results and position the portfolio for improved performance, our team is focused on strategies to strengthen each of their brand with an emphasis on product innovation and marketing. You understand these are not quick fixes. These efforts will take time to give results given that most retailers' shelves reset annually. With the Marc Anthony brand, we're strengthening equity in our core Strictly Curls and Grow Long collections and pursuing growth opportunities in new categories through innovative salon-inspired products. For example, our new Repair Bond collection was launched earlier this year with select retailers. Early consumer feedback has been encouraging and validating, and we recently initiated the marketing -- our marketing and PR campaigns. We aim to establish Repair Bond with Rescuplex as a new core collection that can be rolled out more broadly in 2024.
With Renpure, the major push of this year's brand relaunch. This encompasses a new master brand across all categories, hair, body wash, body lotion, with improved formula that are viewed to elevated standards for clean beauty and first-to-market sustainable packaging. The new products are flowing through point of sale, and our marketing campaigns start to commence next month. We're proud of this work and hopefully our efforts will allow us to rebuild Renpure distribution footprint and establish the brand over time as a leading player within [ conscious ] beauty.
With Cake Beauty, our priorities include innovation and accelerating digitization, particularly growth on Amazon and our D2C channel. We're also working on a high-impact strategic collaboration to increase brand awareness, and we will be rolling out limited-edition collection later this summer.
Lastly, with The Mane Choice, the priorities include a simplified assortment for better retail impact and improved velocities. The brand team is building collections around our store products, such as the Alpha Growth Oil. As with Cake, our emphasis is also on innovation and accelerating digitization. The early results of our new store numbers are encouraging, and we also believe in the potential of our D2C business.
Overall, our success in e-commerce has helped to partially offset lower brick-and-mortar footprint, and we believe the channel has the potential to be better, and we can continue to build on going forward. In addition to these brands and sales priorities, our team continues to implement cost-saving initiatives and operational improvements, which will make us more efficient business and positively impact gross margins and operating profitability. We are tracking to our 2023 plan on these initiatives. I will now ask Laurel to cover the financial highlights in greater detail. Laurel?
Thank you, Serge. Good morning, and thank you for joining us today. As Serge highlighted net sales decreased from $21.1 million last year to $19.3 million this quarter, principally reflecting the impact of distribution losses in the U.S. mass and drug channel. Q1 2023 gross profit decreased by 16% to $7.8 million compared to $9.3 million in Q1 2022, mainly as a result of the sales decline. Gross profit margin for the quarter was 40.7%, a decrease of 44.1% in the first quarter last year.
The decrease mainly reflects the impact of sales mix of the quarter, notably the weight of U.S. Mass and off-price year-over-year. Q1 adjusted EBITDA decreased to $1.3 million from $2.9 million in the same period last year, reflecting lower revenue and gross margin. As a result of changes in the interest rate and payment terms in the recent amendment of our credit facilities, we have recalculated the carrying amount of the total obligation and recorded a loss on modification totaling $1.5 million in Q1 2023. Combined with the softer operating results, this resulted in a net loss of $3.9 million in Q1 2023 versus a net loss of $0.6 million last year.
Adjusted net loss for Q1 2023 was $2.4 million compared with adjusted net income of $0.1 million in Q1 2022. Q1 free cash flow came in at negative $0.1 million, a decrease from $3.7 million in Q1 2022, reflecting lower adjusted EBITDA and higher cash interest. At quarter end, our cash position was $8.3 million, and net debt was $115.6 million.
Before we open the call to questions, we want to thank the MAV team for their ongoing efforts. Now [ Angelo ], would you please open the call up for questions.
[Operator Instructions] Your first question comes from Megan Bergen with Acumen Capital Partners.
I was wondering if you could speak a little bit on your sales by brand, please?
Megan, thanks for joining us. As mentioned, we had 2 of our brands, notably the largest one posting positive results year-on-year for the first quarter. One was directionally flat and one showed a significant decline in line with distribution losses in the U.S. Mass channel.
Okay. And can you also speak a little bit about your pipeline for innovation?
So our pipeline for innovation, if we look at the Marc Anthony brand to start with, the largest initiative this year is Repair Bond with Rescuplex, that was introduced with really the reset earlier this year. And on Renpure, we can consider that the whole brand in a certain way is innovation, as we have really revamped all the different touch points of the brand from formula to packaging to branding. And -- we also have innovation on the other 2 brands that are notably the [ Shine ] collection on Cake [indiscernible] and are ramping up.
[Operator Instructions] There are no further questions at this time. Please proceed.
Thank you for joining us this morning, and have a nice day. Thank you.
Ladies and gentlemen, this concludes your conference call for today. Thank you for participating, and I ask that you please disconnect your lines.