Trulieve Sees Margins Contract, Expenses Climb In Q4 Following Harvest Acquisition
Trulieve Cannabis (CSE: TRUL) reported its fourth quarter and full year financial results for 2021 this morning, posting quarterly revenue of $305.3 million. The company meanwhile posted a net loss for the period, despite the record quarterly sales figure.
Revenue improved 36% on a quarter over quarter basis, climbing from $224.1 million in the third quarter to $305.3 million in the fourth quarter. Despite the massive bump in topline results, the company managed to post declining gross profit on a sequential basis, with gross profits falling from $153.9 million to $132.4 million, a 14% decrease. Gross margin % as a result fell from 69% to that of 43%.
Operating expenses grew rather significantly as well, jumping from $87.7 million to $150.6 million, a 72% increase, and the result of the Harvest Health acquisition closing on October 1. This in turn lead to the company posting a net loss of $71.5 million for the fourth quarter, as compared to an $18.6 million net income in the third quarter. Adjusted EBITDA meanwhile came in at $100.9 million, as compared to $98.0 million in Q3.
For the full fiscal year, revenues rose to $938.4 million, up 80% from $521.5 million seen in 2020. Gross profit was up 47% to $566.1 million, while gross margins were impacted heavily, falling from 74% to 60%. The decline was blamed on “strategic diversification,” with the company moving into lower margin channels and markets.
Despite the significant topline improvement, net income fell 71% on a year over year basis, dropping from $63.0 million to $18.0 million in 2021. Adjusted EBITDA meanwhile improved 48% on an annual basis to $384.6 million.
The company also reported a cash position of $234 million as of December 31, 2021.
In terms of guidance, Trulieve expects revenue for 2022 to be between $1.3 and $1.4 billion, while adjusted EBITDA is expected to come in at between $450 and $500 million. The company also indicated that it expects the second half of the year to have a stronger financial performance than the first half.
Full financial results have yet to be filed as of the time of writing.
Trulieve Cannabis last traded at $25.88 on the CSE.
Information for this briefing was found via Sedar and Trulieve Cannabis. 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.
