Green Thumb Earnings + Call Notes
U.S. cannabis leader reports Q224.
$280.1M Revs; est. $277.2M
$93.8M AEBITDA; est. $84.3M
$150.5M GP; est. $140.7M
$54M OI; est. $53.9M
53.7% GM; est. 50.7%
$20.7M NI; est. $13.8M
$.09 EPS; est. $.04
Repurchased 1.658m shares for $19.9m
^ $26.7m remaining under repurchase plan.
^ $73.3m repurchased / 6,568,125 shares to date.
$20m CFFO ($104m YTD)
Paid $50m of taxes in the quarter
Call Notes
Revs up 11% YoY.
Revs over $280m.
Over $90m aEBITDA.
CFFO of $20m after paying almost $53m in two tax installments.
$73m spent on share repurchases, approx. 6.6m shares.
Almost $27m remaining on share buyback program.
$196m cash.
Price compression in most markets, as well as inflationary pressures.
Focused on products, brands, relationship w/ consumer.
Scale business through retail expansion, build out wholesale business, leverage operational efficiencies, carefully managing balance sheet.
Some of the most well known brands in the business.
Focusing energy this year on expanding brand experiences for consumers.
Beboe launched in NY last month, launching into NJ soon.
Carefully watching consumer trends.
^ believe alcohol is melting, especially for those under 35 y/o.
GTBIF has 50% more EBITDA than SAM and believes alcohol trends will make these companies diversify into other businesses.
Outlined this argument in letter to SAM.
Gaining market share as brands build momentum.
Well positioned for emerging markets such as OH.
OH launching at 5 RISE dispensaries tomorrow.
$20m capex.
Expanding FL retail footprint.
Opening 8 stores in the back half of the year.
$35m CAPEX YTD; expect to invest an additional $50-60m capex through rest of year.
Increased CPG revenue by 15% YoY.
Retail business absorbing impact of compression / erosion.
Excited for product launches into NY A/U market.
NJ NY MD prepared GTBIF well for OH launch.
Investing capital in markets with strong returns. FL NV PA VA.
Pricing YoY continues downward slide.
Expect Q3 revenues to be flat.
^ impact from price compression, some benefit from OH A/U launch.
SG&A of $97m, 34% of revenue.
^ compensation costs driving YoY increase.
$21m net income / $0.09 EPS.
aEBITDA of $94m, 33% of revenue.
Friday learned OH started A/U Tuesday.
Led A/U conversion charge in many states thus far, optimistic on ability into OH.
Think OH easily is a 2x into A/U, should be bigger.
Allocating capital towards high ROI opportunities.
FL NV PA MN VA capital allocation markets.
Continue to optimize performance w/in facilities.
^ continues to benefit margin performance.
Brand + quality of product is also a competitive advantage in margin strength.
Buy what you own, peter lynch style investing will access this sector.
Youth / demographics turning to cannabis, understand the product.
Believe GTBIF will list on US exchanges eventually. Inevitable.
At very early stage of exploration in hemp.
Studying the players.
Some players that are doing a nice job, not everyone following the guidelines.
Believe over time could try to understand how to play the hemp market.
Consumer is main focus at end of the day.
RYTHM + Dog Walkers showing strength, Beboe / Incredibles as well.
^ depending on where they’re launched.
Making strong progress in some markets.
Other markets not making the progress expected.
^ working hard to turn that around.
Consumer traffic is there, but a trading down in purchasing / revenue per gram.
Feeling demand NY wholesale, especially for retail doors w/in NYC limits.
Think early stage, but given the size of the state, beginning to see life in the market.
Early stages, feels like its working, will continue to monitor it.
Morale in NY stronger, feels like one less front where GTBIF will have to fight.
Investing in FL regardless of the A/U vote.
Given the market, have to invest in wholesale before retail, have done that.
Will continue to make wholesale / retail investments.
Investments today are not a bet on A/U.
^ will revisit capital plans for state pending vote.
[Sector] not immune to macro but demand not letting up.
Transactions / tickets not suffering.
/end
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CB1 has a position and nothing contained herein should be considered advice.