Trulieve beats on revenue despite rising yearly losses

Florida-based Trulieve Cannabis Corp. (OTCQX: TCNNF) announced its financial results for the fourth quarter and the full year ending Dec. 31, 2023, showing lower revenues and higher annual losses as it stacks up cash for a potential adult-use wave in Florida.

The company posted a 4% quarterly drop in revenue, down $89 million to $287 million for the period. That beat Yahoo analysts’ average expectations by $19 million, or roughly 7%. The firm saw $298 million in the same period last year, with the majority of sales still deriving from its retail operations.

The company also reported a net loss of $33 million for the quarter, a 57% improvement versus last year’s $77 million loss in the same quarter. When adjusted for specific financial items, the adjusted net loss was reported at $23 million.

“Last year we successfully executed on our plan to bolster our business resilience with a focus on cash generation and preservation while making investments to support future growth,” said CEO Kim Rivers said in a statement.

“Fourth quarter momentum was underpinned by improved consumer trends. We entered 2024 in a position of significant strength just as the outlook for industry growth and reform brightened. With strong cash generation and a clearly defined strategy, Trulieve is best positioned for the coming wave of meaningful growth catalysts.”

For the full year, Trulieve’s revenue came out to $1.13 billion, down 7% from the previous year’s $1.22 billion. Net loss for the full year clocked in at $527 million, up 114% from 2022’s $246 million net loss. After certain adjustments, the adjusted net loss came out to $70 million, up 139% from the previous year.

Operational cash flow was $131 million for the quarter and a free cash flow of $122 million. Cash and cash equivalents were $201.4 million as of Dec, 31, 2023, an increase of $178.7 million, compared to $23.1 million in net cash the year before.

“The improvement is due to the execution of the Company’s inventory wind-down strategy,” it said in filings. It also cited the impacts of income tax accruals, lower sales and marketing, as well as general & administrative expenses.

In terms of its debt strategy, Trulieve redeemed $130 million of senior secured notes and secured a $25 million mortgage financing deal. Looking ahead, the firm expects 2024 cash flow from operations of at least $225 million.

Trulieve also reported on its operations, including the opening of 17 new dispensaries throughout the year, increasing its total to 192 locations nationwide. The company exited the California and Massachusetts markets as well.

There has also been momentum in the company’s quest to place recreational legalization on the Florida ballot this election season, led by Smart & Safe Florida. Trulieve has been the campaign’s principal funder, pouring tens of millions of dollars into the effort.

The Florida Supreme Court has until April 1 to approve the ballot placement, though the state’s attorney general has ardently pushed back.

“The posture of that court definitely leaned positive,” Rivers told investors at the time.

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