Green Thumb Industries Generates $13.6 Million Revenue in Q2

Green Thumb Industries (GTI) Announces Revenue up 291% in Second Quarter 2018

Market Expansion and Disciplined Capital Allocation Lay Foundation for Continued Growth

CHICAGO & VANCOUVER, British Columbia–August 28, 2018–(BUSINESS WIRE)–Green Thumb Industries Inc. (“GTI” or the “Company”) (CSE: GTII) (OTCQX: GTBIF), a national cannabis consumer packaged goods company and owner-operator of the high growth national retail chain RISE™ Dispensaries, today reported its financial results for the second quarter ended June 30, 2018.

Financial Highlights

  • Second quarter 2018 revenues increased 291% year-over-year to $13.6 million. Quarter-over-quarter revenues increased 25%.
    EBITDA¹ was a negative $4.7 million for the quarter. Adjusted EBITDA1 which excludes non-cash and one-time expenses related to the Bayswater reverse takeover transaction (“RTO”) was $0.5 million.
    GTI’s net income was $0.4 million, up from a loss of $1.6 million in first quarter 2018.
    Current assets totaled $128.4 million as of June 30, 2018, including cash and cash equivalents of $112.7 million.
    The Company has approximately $7.9 million of total debt, $1.4 million of which is due within 12 months.
    The Company raised net proceeds of $61 million through a brokered and non-brokered private placement in connection with the RTO of a Canadian public company.

Management Commentary

The second quarter was a critical quarter for GTI. We became a publicly-traded company on June 13th. The team has been hard at work and that is reflected in the results for our first reporting period as a public company – generating solid revenue growth, raising capital, entering new markets and attracting top talent.What lies ahead is even more exciting as this rapidly evolving industry takes shape.

GTI Founder and Chairman Ben Kovler

“We strongly believe that brands developed and produced thoughtfully, consistently, and with the consumer in mind is the path to creating and capturing the most long-term shareholder value. Over the past four years, we’ve built a solid base business on that conviction and our strategy to distribute brands at scale is supported by our vertically integrated business and leading national distribution platform across eight states with a total reach of over 94 million people. We also have a strong balance sheet and are focused on allocating that capital to position the business for growth opportunities ahead.”

Business Infrastructure Development

Through business development and acquisition-related activities, the Company’s geographic reach expanded to eight U.S. markets with a total population of over 94 million and includes eight cultivation and manufacturing facilities and licenses for 59 retail stores. The Company made substantive progress in the following areas:

  • New York License: The Company executed a definitive agreement to acquire a New York licensee, which will make GTI one of ten license holders in the regulated New York State cannabis market.
  • Ohio Dispensary Licenses: The Company was awarded licenses to open five dispensaries in Ohio, the maximum number permitted under current regulations.
  • Talent: Hired over 150 new team members across the country, bringing the total headcount to approximately 400. Over 100 employees are equity holders in the Company. A stock option plan has been developed to continue to align incentives with shareholders.
  • Board of Directors: The Company is building a world-class board of directors with strong independent members. Additions include Glen T. Senk and Wes Moore. Senk, ex-CEO of Urban Outfitters, scaled the Anthropologie retail concept. Moore is the CEO of Robin Hood, New York City’s largest poverty-fighting organization.

Consumer Packaged Goods Business Development

  • At the end of the second quarter, the Company generated wholesale revenue by producing and distributing consumer packaged products in three out of eight GTI markets – Illinois, Maryland and Pennsylvania.
  • Nevada, Massachusetts, Florida and New York are in various stages of production.
  • GTI continues to build out and increase the reach of its suite of branded products including Rythm, DogWalkers and The Feel Collection.

Retail Business Development

  • The Company opened five RISE retail stores in the second quarter, bringing the total store count to 13.
  • Stores opened in Pennsylvania (Erie, Steelton, Carlisle); Maryland (Joppa); and Massachusetts (Amherst).
  • Total consolidated revenue includes 10 of the 13 open stores as two are pending the closing of the transaction (Steelton and Carlisle) and the other is a non-consolidated joint venture (Effingham).

Capital Markets and Financing Activities

  • Listed subordinate voting shares on the Canadian Securities Exchange (“CSE”) under the ticker symbol “GTII” and began trading on June 13.
  • Following the quarter, listed subordinate voting shares on the OTCQX Best Market under the ticker symbol “GTBIF” and began trading on July 9.
  • Subsequent to the end of the second quarter, GTI closed a bought deal financing transaction raising $59 million in net proceeds which will be used to close the definitive agreement to acquire a license in New York and the buildout of five Ohio dispensaries.

Second Quarter 2018 Financial Overview

For the purpose of analysis, total revenue is segmented into wholesale and retail. Wholesale revenue is attributable to the manufacture, sale and distribution of packaged cannabis products to third-party retail customers. Retail revenue is attributable to direct sales to end consumers in the Company’s retail stores.

As of the three months ended June 30, 2018, GTI has operating revenue in five of its eight markets: Nevada, Illinois, Pennsylvania, Massachusetts, and Maryland and has ramped up expenses related to the buildout of new markets in Florida, Ohio and New York in preparation for revenue generation in the second half of 2018 and into 2019.

Total revenue for the second quarter of 2018 was $13.6 million, as compared to $3.5 million for the second quarter of 2017 and $10.9 million for the first quarter of 2018. The year-over-year revenue increase was primarily driven by increased wholesale distribution of its finished branded products to retail customers in Illinois and Maryland, along with increased foot traffic in the Company’s retail stores across all five markets. In particular, year-over-year retail growth was driven by new store openings and acquisitions: notably revenue from the acquisition of two Illinois stores, the opening of RISE stores in Pennsylvania and Maryland, a new RISE store in Nevada and the commencement of adult use sales in the Nevada market.

Gross profit before biological asset adjustment for the second quarter of 2018 was $6.3 million or 46%, as compared to $1.7 million or 50% for the second quarter of 2017. Gross profit after net gains on biological asset transformation for the second quarter was $6.9 million, representing a gross margin of 50%, as compared to 36% for the same period a year ago, and driven by increased harvested cannabis and wholesale shipments.

General and administrative expenses were $11.3 million for the second quarter of 2018, as compared to $2.5 million for the same period last year. The increase was driven by $4.0 million of salaries and benefits due to an increase in headcount from the Company’s new retail facilities in Illinois, Nevada, Maryland and Pennsylvania along with corporate staff development and a non-cash charge related to equity incentive compensation of $1.0 million. The Company also recorded a non-cash listing fee of $3.0 million in addition to $1.3 million of one-time professional fees related to the RTO.

Other income was $34.5 million for the second quarter of 2018, primarily reflecting the fair market value of outstanding warrants held in iAnthus Capital Holdings related to a Debenture Purchase Agreement with the company that was executed in January of 2018.

GTI’s net income for the second quarter of 2018 was $0.4 million, compared to a net loss of $1.3 million for the second quarter of 2017, and net loss of $1.6 million for the first quarter of 2018.

EBITDA1 loss was $4.7 million for the second quarter of 2018, compared to EBITDA1 loss of $1.3 million for the second quarter of 2017. Excluding one-time charges of $1.0 million in expenses related to employee equity grants (non-cash), and $4.3 million related to the RTO, GTI generated $0.5 million in adjusted EBITDA1 for the second quarter of 2018.

Balance Sheet and Liquidity

As of June 30, 2018, total assets were $230.1 million, including cash and cash equivalents of $112.7 million and long-term liabilities of $10.4 million. The Company has $7.9 million of total debt, $1.4 million of which is due within 12 months. Total authorized and issued common shares on a fully diluted basis were 139,471,034.

Subsequent to the end of the second quarter, GTI closed a bought deal financing for net proceeds of $59 million. The net proceeds will provide funding to close the definitive agreement to acquire a license in New York and the buildout of five Ohio dispensaries.

Total authorized and issued common shares on a fully diluted basis including the subsequent raise is 146,771,034.

Additional Information

Additional information relating to the Company’s second quarter 2018 results is available on SEDAR at in the Company’s Interim Financial Statements and Management Discussion & Analysis (“MD&A”).

GTI refers to certain non-IFRS financial measures such as Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and adjusted EBITDA earnings defined as earnings before interest, taxes, depreciation, amortization, less certain non-cash equity compensation expense, including one-time transaction fees and all other non-cash items. These measures do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other issuers.

¹Please see the “Supplemental Information (Unaudited) Regarding Non-IFRS Financial Measures” at the end of this press release for more detailed information regarding non-IFRS financial measures.

Conference Call and Webcast

GTI will host a conference call on Tuesday, August 28, 2018 at 5:00 pm ET to discuss its financial results for the second quarter ended 2018. The conference call may be accessed by dialing 877-273-8145 (Toll-Free) or 647-689-5400 (International) with conference ID: 6479046. A live audio webcast of the call will also be available on the Investor Relations section of GTI’s website at and will be archived for replay.

About Green Thumb Industries:

Green Thumb Industries (GTI), a national cannabis cultivator, processor and dispensary operator, is dedicated to providing dignified access to safe and effective cannabis nationwide while giving back to the communities in which it serves. As a vertically integrated company, GTI manufactures and sells a well-rounded suite of branded cannabis products including flower, concentrates, edibles, and topicals. The Company also owns and operates a rapidly growing national chain of retail cannabis stores called RISE™ dispensaries. Headquartered in Chicago, Illinois, GTI has eight manufacturing facilities and licenses for 59 retail locations across eight highly regulated U.S. markets. Established in 2014, GTI employs approximately 400 people and serves thousands of patients and customers each year. GTI was named a Best Workplace 2018 by Crain’s Chicago Business. More information is available at

Original press release

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