Trulieve Earnings + Call Notes
U.S canna leader shares Q226 results.
$271M Revs; est. $269M
$98M AEBITDA; est. $93M
$162M GP; est. $165M
60% GM; est. 61.3%
($370.5M) OI; est. $45.4M
($406M) NI; est. $12.4M
($ 2.10 EPS); est. $0.04
$407 million impact from the Harvest deconsolidation and equity investment.
Generated cash flow from operations of $53 million and free cash flow of $32 million*
Cash at quarter end was $325 million
Management Commentary
“We made history this quarter as the first U.S. cannabis company to list on the New York Stock Exchange following rescheduling of medical marijuana. With broader cannabis rescheduling and state program expansion in markets like Georgia and Texas on the horizon, Trulieve is well positioned to leverage its scale, financial strength, and branded products to drive future growth.” Kim Rivers, Trulieve CEO.
Call Notes
Largest medical cannabis operator in the US.
Served first FL medical patient 10 years ago.
207 dispensaries.
3.5m sq ft of capacity.
Including Harvest, 241 dispensaries and over 4m sq ft of capacity.
Removal of tax burdened improved net income / CF.
Expect final order this year.
Registered operations w/ DEA.
DEA has looked at 100% of TRLV dispensaries in FL PA WV.
^ expect approval in next few weeks.
TRLV owns 90% of Harvest economics, can reconsolidate when able.
Non-deal road shows since uplisting across US and Canada.
Believe CoC will lower.
GA program changes created an unlock for increased distribution.
TX converting license to final, have opportunity to serve largest MMJ market since FL.
Targeted strategy to capture hemp consumers move back to regulated channel.
Core business continues to outperform; industry leading margins and strong CF.
A/U until June 3rd.
Medical only business up 4% QoQ.
60% GM.
36% aEBITDA margin.
$53m OPCF.
$325m cash.
Retail in-line w/ seasonal trends.
Medical only markets, traffic up 6%, average basket slightly down, units up 8%.
FL Sold 56% more flower per store than state average, across 169 stores.
FL Sold 1.5b mg of oil, 2x the next competitor.
Price mix remains consistent.
Expect GA PA to offset summer pressure in FL.
Expect momentum and continued growth through year end.
Harvest A/U growth QoQ, driven by OH.
Potential retroactive tax applications to be announced.
Investing in GA TX.
TRLV significant growth potential in pharmacy channel + owned dispensaries in GA.
Now shipping to almost 20 pharmacies in GA.
^ over 125 intendent pharmacies expressed interest in carrying medical products.
GA program has 6 licensed operators, TRLV 1 of only 2 tier 1 license holders.
GA program expanded in May, enacted in July w/ new conditions and products (vapes/inhalable flower).
GA July traffic has tripled, sold out of flower due to high demand.
GA cultivation capacity is ongoing, will come online in phases.
6 opened dispensaries in GA, 1 more opening in Fall.
TX near-term potential, largest medical opportunity in the US.
New TX laws revamping the program will benefit.
New TX indications approved, should increase patient enrolment
# of TX operators increasing from 3 to 15
TX TCUP program up 16%, less than 0.5% of TX population.
Investing in retail network w new locations and refresh/remodels.
YTD Opened 8 new dispensaries in FL and refreshed/remodeled 24 locations across market.
Actively evaluating M&A opp in new and existing markets.
^ from tuck-ins to SSO/MSO assets
Investing in technology, launched Project Hyper this year.
Through AI, automating customer relationships at scale.
Expect Project Hyper to show efficiencies by YE.
^ full targeted completion date in March ‘27.
Over 100 community engagement events per month.
Launched FL mobile app last year, adoption continues to exceed expectations, more than 200k downloads since launch.
30% of online orders done through App in Q2.
Launching app in GA later this year, other markets in ‘27.
Rewards program added 80k members in the quarter, passing 1.1m members.
2.2x more spent from reward members, 80% of Q2 transactions.
Awarding customers that spend more.
Sold almost 14m branded product units.
^ modern flower/roll one almost 50% of units sold.
Roll One Clutch product units sold up 30%.
June 3 deconsolidation effect.
$271m revenue, in-line w guidance.
$222m medical-only revenue, up 4% QoQ.
$162m 60% GM – full business.
$140m 63% GM in medical-only states.
Expect quarterly GM to vary based on product/market mix.
^ inventory sell through, promo.
$102m SG&A, 38% of revenue.
^ Adj SG&A at 32% of revenue.
Excl non-recurring items, Q2 net income would have been $20m or $0.11 EPS.
^ Excl pizza, chocolate, I would weight 185 lbs.
$98m aEBITDA, 36% margin.
Confident in ability to address outstanding UTP.
$325m cash, $289m debt.
$53m OPCF.
$32m FCF.
$21m CAPEX.
Q3 revenue medical-only.
^ expect Q3 revenue comparable to medical-only revenue in Q2
Growth in GA PA expected to offset seasonal pressure in FL.
Expect growth to accelerate into YE.
Expect GM to be comparable w/ 63% GM in medical operations.
Expect FY’26 OPCF of at least $225m, reduced from $250m to reflect deconsolidation.
FY’26 $95m capex expected, up from $85m.
May accelerate capex in TX.
First company to deconsolidate A/U businesses.
Will see GA growth ramp this year.
Can add a new dispensary with every 10k patients enrolled in GA.
GA pharmacy network expanding.
Exploring hybrid retail model in GA, whether a store within a store construct, or a pop up branded as TCNNF.
Can purchase independent pharmacies in GA.
Should be able to reach fl scale in tx; Laser focused on opp.
Believe experience in FL is unique, understand what is required to enter a market, build relationships, build capacity.
TX patients need to see access to come into the program.
Built, complete and ready to go on P1 cultivation.
^ informed regulators
^ will move quickly once green light on license conversion to final
In FL, regulated market has over 700 locations across state.
^ think FL hemp market is 7,000 or $4b market size
TX a large hemp market, $6b market.
Will be interesting to see what happens in TX w hemp changes.
Think PA has a significant hemp market.
Operate in OH, saw increase in demand following hemp shut down.
Can expand up to 100k sq ft of canopy under existing GA license.
RE: Q3 guidance - Expect GA PA to offset seasonal slowness in FL.
Believe GA growth accelerates into Q4 and ‘27.
8,000 GA patients added since July 1, 24% increase.
Even w/o flower on shelves, seeing increased sales in GA.
Seeing interest from a lot of long-only funds not in the sector previously, along with people investors in the sector previously, who are now taking a fresh look.
Active conversation w bulge bracket guys, many have policies and rules that need to be removed in order to invest in the sector.
Should have institutional investors in TRLV in the next 12mo.
Active conversations w/ credit card companies.
Believe on the cusp of getting FINCEN guidance updated.
Being listed, having ability to show medical portfolio w/ DEA-licensed businesses that are S3, allowing many additional conversations that were unavailable previously.
In July, just under 1k patients/week added in FL, Q1 was 326 patients/week.
GA opportunity is significant, will continue to invest there.
On M&A, think we will see renewed interest from private operators and smaller distressed operators.
Strong cash balance, listed on NYSE ; attractive set up to execute on M&A.
Don’t have state-level data yet in GA, hoping commission begins to release numbers
Own 6 of 17 dispensaries in GA.
/end
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CB1 has a position and nothing contained herein should be considered advice.