The stateside cannabis sector continues to follow the path of the Canadian cannabis sector, with Trulieve Cannabis (CSE: TRUL) this morning reporting a massive net loss for the second quarter of 2023 as a result of goodwill impairments.
The company saw a net loss of $406.9 million for the second quarter, driven in large part by the impairment of goodwill to the tune of $307.6 million. The impairment was triggered by the recent share price performance of the company, rather than as a result of the operations themselves. Excluding discontinued operations, disposals, impairments, and non-recurring charges, Trulieve reported an “adjusted net loss” of $15 million.
Revenue declined on a quarter over quarter basis for the multi state operator, dropping from $289 million to $282 million, with the company noting that price compression is becoming a factor in its revenue growth.
On a year over year basis, revenue declined 10% from $314 million. This decline comes as the company has exited its California retail assets and commenced a wind down of its operations in Massachusetts in an effort to preserve cash.
“We are on track to exit this year as a leaner, stronger organization, ready to meet the opportunities ahead,” commented CEO Kim Rivers.
Gross profit declined from $150 million to $142 million sequentially, while margins dropped two percentage points to 50%.
READ: Trulieve Cannabis Sees CFO Quit After Just Ten Days On The Job
SG&A expenses however also fell, dropping from $102 million to $96 million, before factoring in the goodwill impairment.
Adjusted EBITDA for the quarter came in at $79 million, an improvement over the $78 million figure reported in the first quarter, while cash flow from operations excluding tax payments rose to $98 million year to date. Despite this, the firms cash position declined from $195 million to $160 million over the course of the second quarter.
Total current assets declined from $574.2 million to $474.8 million during the quarter, while total current liabilities increased from $188.3 million to $240.6 million.
Trulieve Cannabis last traded at $5.69 on the CSE.
Information for this briefing was found via Sedar and the companies mentioned. 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.
