Pricing Pressure Emerges as a Key Theme Among Cannabis Companies

The Public Cannabis Company Revenue & Income Tracker, managed by New Cannabis Ventures, ranks the top revenue producing cannabis companies. This data-driven, fact-based tracker will continually update based on new financial filings so that readers can stay up to date. Companies must file with the SEC or SEDAR and be current to be considered for inclusion.

When we launched this resource in May 2019, companies with quarterly revenue in excess of US$2.5 million qualified. As the industry has scaled and as more companies have gone public, we have raised the minimum several times subsequently, including a move to US$5 million in October 2019, to US$7.5 million in June 2020, to US$10 million in November 2020 and US$12.5 million in August 2021.

Due to the rapid growth in the cannabis industry, we raised the minimum to US$25 million (C$32 million) to qualify for what we now call the senior list and introduced a junior list with a minimum of US$12.5 million (C$16.0 million) in September 2021. At the time of our last update in late February, 36 companies qualified for inclusion on the senior list, including 30 filing in U.S. dollars and 6 in the Canadian currency. The junior list now includes 12 reporting in U.S. dollars and 4 in Canadian dollars. On a combined basis, the Public Cannabis Company Revenue & Income Tracker now includes 52 companies. Since our last update, Cronos Group (TSX: CRON) (NASDAQ: CRON) has moved from the junior group to the senior group of companies reporting in American dollars. We have also removed GAGE Growth from the U.S. senior group, which now includes 30 companies, due to its acquisition. We expect to add additional companies in the months ahead, and, due to pending or recently completed mergers, we anticipate some removals as well. We note that Intercure (TASE: INCR) (NASDAQ: INCR), which reports in the Israeli currency, qualifies for the junior list, but we haven’t yet added it due to its different reporting currency.

In May 2019, we added an additional metric, “Adjusted Operating Income”, as we detailed in our newsletter. The calculation takes the reported operating income and adjusts it for any changes in the fair value of biological assets required under IFRS accounting. We believe that this adjustment improves comparability for the companies across IFRS and GAAP accounting. We note that often operating income can include one-time items like stock compensation, inventory write-downs or public listing expenses, and we recommend that readers understand how these non-cash items can impact quarterly financials. Many companies are moving from IFRS to U.S. GAAP accounting, which will reduce our need to make adjustments. Please note that our rankings include only actual reported revenue and not pro forma revenue. We also note that companies with non-cannabis operations must provide segment-level financial reports that detail not only revenue but also operating profit to be have their operating profit included in the tracker. Currently, Jazz Pharma (NASDAQ: JAZZ) and Tilray (TSX: TLRY) (NASDAQ: TLRY) aren’t providing this information.

Since our last update, several companies have reported, including some of the largest MSOs. Ascend Wellness (CSE:AAWH.U) (OTC: AAWH), Curaleaf (CSE: CURA) (OTC: CURLF) and Green Thumb Industries (CSE: GTII)(OTC: GTBIF) were all in line, roughly, with expectations, but the outlooks reflected more competitive environments in several states. Additionally, the delay in New Jersey weighed on their outlooks.

Curaleaf maintained the top spot as its revenue fell slightly short of expectations and its adjusted EBITDA slightly ahead. The real story was its outlook for 2022 of revenue of $1.4-1.5 billion, well below the prior expectations of $1.6 billion. GTI revenue was slightly ahead of expectations, but its gross margin declined, leaving its adjusted EBITDA lower than what analysts had expected. The company called out the markets in Nevada and Pennsylvania as having become more competitive. Ascend Wellness had been expected to see a decline in revenue from Q4, which was the case. Acreage Holdings (CSE: ACRG.A) (OTC: ACRHF) reported revenue of $58.1 million, up 21% sequentially but boosted by an acquisition in Ohio. Still, it was ahead of what analysts had expected for both revenue and adjusted EBITDA. Note that its adjusted operating loss was impacted by a one-time write-down.

Jazz Pharma (NASDAQ: JAZZ) reported that its Epidiolex sales expanded 21% from Q3 and 35% from a year ago to $194 million. Ancillary names Hydrofarm (NASDAQ: HYFM) and GrowGeneration (NASDAQ: GRWG) saw sequential declines in revenue despite contributionsfrom recent acquisitions.

American Dollar Reporting – Public Cannabis Company Revenue Tracker


Over the balance of March, several other large companies are expected to report, including Trulieve (CSE: TRUL) (OTC: TCNNF), Cresco Labs (CSE: CL) (OTC: CRLBF), Columbia Care (CSE: CCHW) (NEO: CCHW) (OTC: CCHWF), Ayr Wellness (CSE: AYR.A) (OTC: AYRWF), Jushi Holdings (CSE: JUSH) (OTC: JUSHF), TILT Holdings (NEO: TILT) (OTC: TLLTF) and TerrAscend (CSE: TER) (OTC: TRSSF).

According to Sentieo, Trulieve is expected to have generated revenue of $310 million in its Q4, which includes the contribution of Harvest Health and Recreation for the full quarter. Adjusted EBITDA is projected to have been $107 million. Cresco Labs Q4 revenue is projected to have increased 46% from a year ago to $237 million with adjusted EBITDA of $69 million. Columbia Care Q4 revenue was anticipated to have increased to $137 million with adjusted EBITDA of $30 million, though a pre-announcement in conjunction with a change in the date of its earnings release to 3/24 suggests that the revenue was $140 million with adjusted EBITDA under IFRS accounting at $30.2 million and lower under GAAP accounting.

Ayr Wellness Q4 revenue is expected to be up 10% from Q3 to $106 million with adjusted EBITDA of $26 million. Jushi Holdings Q4 revenue is anticipated to be $66 million, with adjusted EBITDA of $8 million. TILT Holdings Q4 revenue is expected to increase 51% to $56 million, with adjusted EBITDA of $6 million. Finally, TerrAscend is expected to have generated Q4 revenue of $54 million and adjusted EBITDA of $14 million.

In the first part of March, Valens (TSX: VLNS) (NASDAQ: VLNS) and Humble & Fume (CSE: HMBL) (OTC: HUMBF) reported. Valens Q4 revenue advanced 15% from a year ago, while Humble & Fume was flat in its Q2 as it rationalized certain lines of lower-margin business in the U.S.

Canadian Dollar Reporting – Public Cannabis Company Revenue Tracker

Over the balance of March, High Tide (TSXV: HITI) (NASDAQ: HITI), which has scheduled its call, and HEXO Corp (TSX: HEXO) (NASDAQ) and Nova Cannabis (TSX: NOVC) (OTC: NVACF), which haven’t done so yet, will be reporting. According to Sentieo, High Tide Q1 revenue is expected to increase 83% from a year ago to C$70 million with adjusted EBITDA of C$1 million. HEXO Q2 revenue is expected to expand 70% from a year ago to C$56 million with adjusted EBITDA of -C$6 million. Both companies are benefiting from recent M&A. Nova Cannabis is covered by a single analyst who is forecasting Q4 revenue of C$49 million and breakeven adjusted EBITDA.

For those interested in more information about companies reporting in March, we publish comprehensive earnings previews for subscribers at 420 Investor, including for Focus List members mentioned here Ayr Wellness, Columbia Care, Cresco Labs, TerrAscend, TILT Holdings and Trulieve.

Visit the Public Cannabis Company Revenue Tracker to track and explore the complete list of qualifying companies. We have recently created a way for our readers to access our library of Revenue Tracker articles. For our readers who are interested in staying on top of scheduled earnings calls in the sector, we have have created and continually update the Cannabis Investor Earnings Conference Call Calendar.

Exclusive article by Alan Brochstein, CFA
Alan Brochstein, CFA
Based in Houston, Alan leverages his experience as founder of online community 420 Investor, the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. At New Cannabis Ventures, he is responsible for content development and strategic alliances. Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 at Seeking Alpha, where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alan: Twitter | Facebook | LinkedIn | Email

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