Trulieve Q4 2023 Financials: 4% Revenue Drop, Narrowed Losses

Trulieve Cannabis (CSE: TRUL) has released its financial results for the fourth quarter and full year ending December 31, 2023. For the three-month period, the firm reported revenue of $287 million, marking a 4% drop from Q4 2022’s $298 million and a 4% increase from Q3 2023’s $275 million. Notably, 95% of this revenue was attributed to retail sales.

The company achieved a gross margin of 54%, resulting in a gross profit of $154 million. This came down to a reported net loss of $33 million, up from last year’s $77 million loss but down from last quarter’s $25 million loss.

Trulieve also generated $131 million in cash flow from operations and $122 million in free cash flow. The firm achieved EBITDA of $73 million and adjusted EBITDA of $88 million, representing 25% and 31% of revenue, respectively. The fourth quarter outperformed the previous quarter, driven by increased consumer activity during the holiday season, leading to higher traffic, basket size, and units sold.

Additionally, Trulieve took strategic financial actions, redeeming $130 million of senior secured notes and closing a $25 million five-year mortgage financing deal. Furthermore, the company filed amended federal tax returns for 2019, 2020, and 2021, claiming significant refunds totaling $143 million, alongside corresponding state returns amounting to $31 million in refunds.

Trulieve also relocated one dispensary and opened four new dispensaries in Florida, concluding the quarter with 32% of retail locations outside the state.

“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,” said CEO Kim Rivers in a statement.

For the full year 2023, Trulieve reported revenue of $1.13 billion, with 96% derived from retail sales. This is a drop from 2022’s annual revenue of $1.22 billion. Gross margin also dropped from 57% last year to 52% in 2023.

While the firm managed to lower SG&A expenses by $61 million compared to the prior year, it yielded an operating loss this year at $221.6 million compared to an operating income in 2022 at $50.2 million.

This resulted in a wider net loss of $527 million in 2023, compared to the $253 million loss in 2022. The company generated cash flow from operations totaling $202 million and free cash flow amounting to $161 million, achieving adjusted EBITDA of $322 million, or 29% of revenue.

In terms of operational expansion, Trulieve launched adult-use sales in Connecticut and Maryland, opened new medical dispensaries in Georgia and Ohio, and exited retail operations in California and Massachusetts as part of its strategic plan. The company opened 17 dispensaries in 2023, increasing its retail footprint to 192 locations nationwide by year-end.

Moreover, Trulieve revamped its leadership team by adding two new executives in January: Wes Getman as Chief Financial Officer and Marie Zhang as Chief Operating Officer. The company also recently opened one retail location in Pinellas Park, Florida, bringing its total operational dispensaries to 193, with over 4 million square feet of cultivation and processing capacity across the United States.

Trulieve Cannabis last traded at $14.00 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.

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