Tilray Brands Sees Fourth Quarter Impacted By Massive Impairments, Negative Gross Profit
Tilray Brands (TSX: TLRY) this morning reported its fourth quarter and full year fiscal 2022 financial results. The results were highlighted by slowing quarterly growth, as well as major impairments that resulted in a significant net loss.
Revenue for the quarter amounted to $153.3 million, marking growth of 0.96% on a quarter over quarter basis. The quarter saw the firms cannabis segment slide to 35% of revenues at $53.3 million, while distribution revenue fell to 39% at $61.2 million. Beverage alcohol meanwhile increased to 15% of revenues at $22.7 million, while the remainder came from the wellness segment, at 11%, or $16.2 million.
Gross profit for the quarter meanwhile was negative $6.7 million.
Operating expenses for the quarter totaled $460.7 million, with the massive expensive here being a $378.2 million impairment related to inventory, goodwill and other intangible assets. Commenting on the significant writedowns, the company stated, “The impact was related to changes in market opportunities causing a shift in our strategic priorities.”
Excluding these massive impairments, expenses for the quarter totaled $82.4 million, versus $59.6 million in the third quarter. Despite this, the company told a story of cost-saving synergies that came as a result of the recent merger with Aphria Inc, which are said to have hit $85 million, $5.0 million more than the forecasted figure.
A further $20 million in savings are now expected to be realized as a result of that transaction, while the recent arrangement with Hexo (TSX: HEXO) is expected to deliver an additional $80 million in savings. Whether those savings are enough to reach profitability however is another question.
Overall, the company posted a net loss of $457.8 million for the three month period, along with adjusted EBITDA of $11.5 million.
For the full fiscal year, the company posted revenues of $628.4 million, versus $513.1 million in 2021. Gross profit came in at $116.8 million, while operating expenses totaled $727.2 million. The firm posted a net loss of $434.1 million for the full fiscal year, and adjusted EBITDA of $48.0 million.
In terms of its balance sheet, the company ended the year with $415.9 million in cash on hand, and total current assets of $803.5 million. Total current liabilities meanwhile sit at $280.3 million.
Tilray Brands last traded at $4.18 on the TSX.
Information for this briefing was found via Sedar and Hexo Corp. 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.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.
