• Revenue: Reported at $298 million, up 4% year-over-year, exceeding the estimated $285.97 million.

• Net Loss: Recorded at $23 million, an improvement from previous figures, but still exceeding the estimated net loss of $18.13 million.

• Gross Margin: Achieved a gross margin of 58%, indicating a significant improvement from the previous year's 53%.

• Free Cash Flow: Generated a robust $124 million in free cash flow, highlighting strong operational efficiency.

• Adjusted EBITDA: Reached $106 million, or 36% of revenue, showing a substantial increase of 35% year-over-year.

• Retail Expansion: Opened three new dispensaries, contributing to a total of 196 retail locations, with 31% outside of Florida.

• Cash Position: Ended the quarter with $327 million in cash, bolstered by significant tax refunds and operational cash flow.

• Warning! GuruFocus has detected 7 Warning Signs with TCNNF.

On May 9, 2024, Trulieve Cannabis Corp (TCNNF), a leading cannabis company in the U.S., released its first quarter financial results for the year, demonstrating a robust performance with significant improvements in revenue and net loss. The details were disclosed in their latest 8-K filing.

Company Overview

Trulieve Cannabis Corp is a vertically integrated "seed to sale" and fully licensed medical marijuana company. It is primarily involved in the cultivation, possession, use, sale, and distribution of medical cannabis.

Financial Performance

The company reported a revenue of $298 million for the first quarter of 2024, marking a 4% increase both sequentially and year-over-year, which surpasses the estimated revenue of $285.97 million. This growth was primarily driven by increased retail traffic and larger average basket sizes, with 96% of the revenue generated from retail sales.

Trulieve achieved a gross margin of 58%, translating to a gross profit of $174 million, up from $150 million in the same quarter of the previous year. The company's net loss improved significantly to $23 million, a 31% sequential improvement and a 64% improvement year-over-year. This performance is better than the anticipated net loss of $18.13 million.

Adjusted EBITDA stood at $106 million, or 36% of revenue, reflecting increases of 21% sequentially and 35% year-over-year. The company also reported strong cash flow from operations at $139 million and free cash flow of $124 million.

Operational Highlights and Future Prospects

During the quarter, Trulieve opened three new dispensaries in Florida and continued to expand its footprint with 31% of retail locations now outside of Florida. The company currently operates 196 retail dispensaries and over 4 million square feet of cultivation and processing capacity in the United States.

Looking ahead, Trulieve is well-positioned for growth with the Smart & Safe Florida initiative for adult use cannabis expected to be on the ballot in November 2024. Additionally, the federal rescheduling of cannabis to Schedule III could significantly reduce the tax burden and facilitate research, providing further growth opportunities for Trulieve.

Management's Commentary

Conclusion

Trulieve Cannabis Corp's first quarter results for 2024 reflect a company that is not only growing in terms of revenue and operational efficiency but also strategically positioning itself for significant future expansion. The improvements in net loss and strong cash flow generation underscore the company's financial health and operational prowess, making it a noteworthy player in the cannabis industry.

For more detailed information about Trulieve's financials and future outlook, interested parties can access the full earnings report and supplementary materials on the company's investor relations page.

Explore the complete 8-K earnings release (here) from Trulieve Cannabis Corp for further details.

This article first appeared on GuruFocus.