The report says average gross margins are down 6% including the...

The report says average gross margins are down 6% including the uplift from the higher 35% margins from DoD. So, assuming 7% drop in gross margin for product sales of $56mil (report notes only 1% reduction in sales revenue PCP so results are comparative), this would equate to roughly $4mil reduction of gross profit from product sales.

The actual reduction in gross profit is $20.3 - $17.6mil = $2.68Mil

The difference I believe is the additional profit from the 2 months of DoD revenue.

The main driver of the additional loss of profit is the 45% ($4.14mil) increase in operating expenses of which the report states "A material factor contributing to this increase was the acquisition of Doctors on Demand which resulted in significant one-off transaction and integration costs, including legal and accounting costs, and, as from the beginning of November, the inclusion of additional personnel and sales and marketing expenses.

looking at the increase in doctor accounts, increase in registered patients, potential massive synergies with DoD, first mover in the nicotine vaping with 80% of pharmacies on board, I'm betting this massive drop in profit is a once off due to the additional costs of the acquisition with only 2 months of the profits and none of the synergies.