Clever Leaves Reports Third Quarter 2021 Results, Continues Expansion

Clever Leaves Holdings Inc. CLVR CLVRW, a leading multinational operator and licensed producer of pharmaceutical-grade cannabinoids reported its financial and operating results for the third quarter ended September 30, 2021.

Third Quarter 2021 Highlights vs. Same Year-Ago Quarter

• Revenue increased 3% to $4.0 million compared to $3.9 million, driven by continued strength within the non-cannabinoid segment.
• All-in cost per gram of dry flower equivalent remained flat at $0.15, attributed to the sustained ramp of early-stage operations in Portugal.
• Gross profit increased 22% to $2.5 million, reflecting a 62.9% gross margin, a 1,000 basis point increase.
• Net income was $1.0 million compared to a net loss of $6.1 million.
• Adjusted EBITDA (a non-GAAP financial measure) was $6 million compared to $3.7 million.

Third Quarter 2021 Financial Results

• Revenue in the third quarter of 2021 increased 3% to $4.0 million compared to $3.9 million for the same period in 2020, driven by continued strong performance within the non-cannabinoid segment.
• All-in cost per gram of dry flower in the third quarter of 2021 remained flat at $0.15 per gram compared to the same period in 2020. This performance was achieved by continued cost efficiencies in the Company's Colombian production operations, offset by production costs associated with early-stage operations in Portugal.
• Gross profit in the third quarter of 2021 increased 22% to $2.5 million compared to $2.1 million for the same period in 2020.
• Operating expenses in the third quarter of 2021 were $12.2 million compared to $6.8 million for the same period in 2020.
• Net income in the third quarter of 2021 increased significantly to $1.0 million compared to a net loss of $6.1 million for the same period in 2020. The increase was primarily attributable to gains on re-measurement of warrant liability of $9.1 million, as well as gains on debt extinguishment.
• Adjusted EBITDA in the third quarter of 2021 was $6.0 million compared to $3.7 million for the same period in 2020, driven by higher public company expenses.
• Cash, cash equivalents and restricted cash were $46.2 million on September 30, 2021, compared to $79.5 million on December 31, 2020.
• The Company also reduced its total debt by over $7.5 million during the third quarter of 2021.

"Our third-quarter performance was marked by key operational advancements that have positioned us for continued execution towards our long-term growth strategy. We maintained year-over-year growth across revenue and gross profit as our U.S. nutraceutical business continues to recover from the lows of the pandemic last year,” Kyle Detwiler, CEO of Clever Leaves said in a press release. 

“In Europe, a market of growing global importance, we have continued our progress scaling our Portugal cultivation operations. We aim to continue leveraging our production advantages and growing base of international partners to further establish Clever Leaves as a supplier of choice within the global cannabinoid supply chain.”

Detwiler added that he was proud to announce the completion of the expansion of a cultivation facility in Portugal during the quarter, which provides the company with an additional 150,000 square feet of cultivation space.

“In Colombia, our EU GMP-certified operations and cost-effective production put us in a strong position to take advantage of the presidential decree allowing for the commercial production and export of medical cannabis flower,” continued Detwiler.

"Following the launch of our Project Change Lives initiative in June, we have already announced U.S. research partnerships with the University of California Davis and the University of Missouri,” Detwiler concluded.

Revised 2021 Outlook:

Clever Leaves expects 2021 revenue to be between $14 million and $16 million, compared to its previously stated range of between $17 million and $20 million. The firm continues to expect the full-year 2021 gross margin to be approximately 61% and has narrowed its full-year adjusted EBITDA forecast and expects capital expenditures of approximately $10 million for the year.

Price Action:

Clever Leave's shares traded 5.387% lower at $5.98 per share at the time of writing, after market close, Wednesday night.

Image By Ilona Szentivanyi