Maryland Cannabis Sales Boosted This Company's Q3 Revenue To 13% Sequential Surge

Ascend Wellness Holdings Inc AAWH AAWH reported an increase in its financial metrics on Tuesday for the third quarter ending September 30, 2023.

Q3 2023 Financial Highlights

• The vertically integrated cannabis operator reported $141.3 million in net revenue, up 27% from the same period last year and a 14.9% increase from the previous quarter.
• Net loss of $11.2 million during the quarter represented an improvement compared to $16.9 million in the third quarter of 2022.
• Retail revenue increased 22.3% year-over-year and 12.7% quarter-over-quarter to $101.3 million.
• Adjusted EBITDA came in positive at $29.5 million, representing a sequential increase of 38.5%. 
• Adjusted EBITDA margin improved by 356 basis points sequentially.
• Gross profit was $43.6 million, or 30.8% of revenue, compared to $28.3 million, or 23.0% of revenue in the prior quarter.
• Cash flows from operations totaled $24.2 million while free cash flow was $12.9 million.
• As of September 30, 2023, cash and cash equivalents came to $63.9 million while net debt was $243.5 million.

John Hartmann, the company's CEO, praised the quarterly increase in retail revenue. 

“In my first full quarter as Ascend’s CEO, we’ve been diligently optimizing operations and fortifying our team," he said. "Early signs of results are encouraging, with a noteworthy 13% sequential surge in retail revenue, chiefly propelled by the successful launch of adult-use sales in Maryland."

Hartmann also provided some insight into operational milestones in some of the key markets.

"Moreover, our net wholesale business experienced an impressive 21% sequential growth, driven by growth in New Jersey, Illinois, and Massachusetts," he explained. "We’ve further expanded our offerings, introducing the ‘Royale’ super-premium brand, while actively working to resolve cultivation challenges in New Jersey."

Key Leadership Changes

As previously reported, Ascend announced key leadership changes subsequent to the quarter, including the appointment of Mark Cassebaum as CFO, effective November 27th, 2023, Chris Holzer as COO and Denise Pedulla as chief legal officer and corporate secretary.

AAWH Price Action

AWH’s shares were trading 5.83% higher at $1.09 per share at the time of this writing mid-morning on Tuesday.

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