Cresco Labs Earnings + Call Notes

U.S. cannabis leader shares Q324 results

Cresco Labs Earnings

$180M Revs; est. $185.9M
$51M AEBITDA; est. $51.6M
$93M GP; est. $94.4M
$26M OI; est. $33M
53% GM; est. 50.8%

Third quarter revenue of $180 million.

Gross profit of $93 million.

Adjusted gross profit of $95 million; and an Adjusted gross margin of 53% of revenue, a 250 bps improvement year-over-year.

SG&A of $57 million.

Reduced Adjusted SG&A by 6% year-over-year to $53 million, or 30% of revenue.

Net loss of $8 million.

Third quarter aEBITDA of $51 million, up 5% year-over-year; and aEBITDA margin of 29%, a 280 bps improvement year-over-year.

Record third quarter operating cash flow of $49 million and Free Cash Flow of $43 million.

Retained the No. 1 share position in Illinois, Pennsylvania and Massachusetts and improved to a top 3 position in Ohio.

“Our focus remains the same, win in strategic markets w a brand portfolio consumers love, provide best-in-class retail operations and maintain a relentless pursuit of financial strength. Our Q3 results underline the success of this strategy with $180M in revenue at 29% aEBITDA margin, and most importantly $49M operating cashflow, our highest ever.

“So far this year, we generated $103M in operating cashflow, enabling us to reinvest in our core, and to explore new markets and growth verticals, all while improving our balance sheet and paying down debt.

“While we’re disappointed that the Florida initiative didn’t reach the super majority threshold it needed to pass, we still saw substantial bipartisan majority support at 56% for cannabis legalization. For the first time ever, we had two presidential candidates that both supported broad federal cannabis reform. We look forward to working with the incoming administration to follow through on its commitment to developing a commonsense approach to cannabis laws including the passage of SAFE banking, rescheduling, and the fact that no one should be arrested for personal cannabis use.” Charlie Bachtell, Cresco Labs CEO and co-founder.

Call Notes