Curaleaf Holdings (CSE: CURA) this evening reported its third quarter financial results, reporting total revenue of US$182.4 million for the three month period, and increase of 55% from the $117.5 million in revenues posted in the second quarter. The company also reported a net loss of $9.3 million for the period.
Revenues climbed substantially on a quarter over quarter, with the largest increase coming from retail revenues, which rose from $66.3 million go $135.3 million over the course of the quarter. Wholesale revenue meanwhile rose from $33.3 million to $45.0 million, while management fee income fell from $17.9 million to $2.1 million. The latter is a result of the company closing on the purchase of a managed entity. It should also be noted that “managed revenue” rose from $121.4 million to $193.2 million.
The steep climb in revenue growth on a quarter over quarter basis is a result of the closing of the Grassroots acquisition, along with Curaleaf NJ and Maine Organic Therapy.
Looking back to total revenue, the company managed to book gross profits of $91.8 million on these sales before the impact of biological assets, with cost of goods amounting to $90.6 million. Operating expenses meanwhile amounted to $99.4 million, as compared to $59.5 million in the prior quarter.
Selling, general and administrative expenses accounted for the largest increase, growing from $40.5 million to $72.7 million. Share based compensation meanwhile came in at $5.4 million, while depreciation and amortization amounted to $21.3 million.
In terms of other income and expenses, the company recorded an interest expense of $12.4 million, while interest expenses related to lease liabilities cost the company a further $5.1 million. A gain on investment of $10.6 million meanwhile offset this marginally. After a tax expense of $18.7 million, the company recorded a net loss of $9.3 million.
Moving to the balance sheet, the company saw its cash and cash equivalents decline from $122.8 million to that of $84.6 million, despite raising $24.5 million in net proceeds from a private placement and a further $41.0 million in proceeds from sale leaseback transactions. Inventory meanwhile increased from $129.8 million to $182.9 million, while receivables grew to $23.0 million from $18.2 million. Total current assets overall grew from $340.1 million to $376.9 million.
Accounts payable and accrued expenses meanwhile both grew, climbing from $25.3 million and $30.6 million, to $30.8 million and $44.8 million, respectively. Income tax payable decreased however, falling to $35.5 million from $40.3 million. The current portion of lease liability increased dramatically, rising from $13.4 million go $39.8 million. Total current liabilities overall climbed from $129.5 million to $177.2 million.
Finally, the Curaleaf concurrently announced that CEO Joseph Lusardi will be taking on the role of executive vice-chairman of the company effective January 1, 2021 after five years in his current role. In his place will be that of Joseph Bayern, whom is the current President of the company.
Curaleaf Holdings last traded at $14.12 on the CSE.
Information for this briefing was found via Sedar and Curaleaf Holdings. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
