Ayr Wellness' Stock Slightly Up On Announcing 5% Share Buyback

Vertically integrated cannabis multi-state operator Ayr Wellness Inc. AYR AYRWF announced Wednesday that its board has authorized the repurchase of up to 5% of its subordinate voting shares over the next 12 months pursuant to a normal course issuer bid. That’s the maximum amount allowed for CSE-listed companies, Ayr Wellness highlighted.

"We expect this program to be used opportunistically and to commence immediately,” said 

Jonathan Sandelman, CEO of the New York-based company. “We continue to invest in and build our business, both organically and through M&A, and this repurchase program allows us to also invest in the exceptional value that our own shares represent.” 

The company also reaffirmed its 2022 guidance of $800 million in revenue and $300 million in Adjusted EBITDA, Sandelman added, as it has over $123 million of cash on hand.

“The Share repurchase program will in no way interfere with our ambitious growth plans to enter new markets and/or complete our current capital projects,” Sandelman explained.

Ayr Wellness recently reported having generated $91.3 million in the second quarter of 2021, representing a 222% growth from the same quarter of 2020.

Earlier this month, the company entered into a binding letter of intent to acquire Cultivauna, LLC, the owner of Levia branded cannabis-infused seltzers and water-soluble tinctures.

Ayr agreed to pay $20 million in upfront consideration, including $10 million in cash with the remainder in stock in return. An earn-out payment of up to an additional $40 million will be paid in shares based on the achievement of particular revenue milestones in 2022 and 2023.

Price Action

Ayr Wellness’ shares traded 1.82% higher at $25.14 per share at the time of writing Wednesday late morning.

Photo: Courtesy of Tim Foster on Unsplash