The Cannabist Co. Q3 Revenue Declines 8%, Completes $5M Asset Sale, Exits Florida Market Amid Restructuring

The Cannabist Company Holdings Inc. CBSTF, former Columbia Care, announced its Q3 2024 financial results, reflecting the impact of recent divestitures and a focus on reshaping its operational footprint.

The quarter's results for this leading U.S. cannabis cultivator, manufacturer and retailer were affected by adjustments from asset sales, notably in Arizona and Virginia and efforts to enhance profitability in core markets.

Third Quarter 2024 Financial Overview

• Revenue: $114.8 million, an 8% decline from Q2, primarily due to the sale of Arizona and Eastern Virginia assets. Revenue excluding divestitures held steady.
• Gross Profit: $43.8 million, an improvement from $37.1 million in Q3 2023, with an adjusted gross margin of 38.2%.
• Adjusted EBITDA: $14.8 million, with a 12.9% margin, down from 14% in Q2 due to asset sales.
• Cash Position: Closed Q3 with $31.5 million in cash, up from $22 million in Q2.

"The results in the third quarter are indicative of the continued transformation that is underway at The Cannabist Company as we strive to build a better business by strategically reshaping our footprint, streamlining operations, and derisking the balance sheet," CEO David Hart stated. He added that the company aims to focus on more profitable markets with growth opportunities.

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Florida Asset Sale

In alignment with its restructuring plan, The Cannabist Company finalized the sale of 14 dispensaries and two cultivation and manufacturing facilities in Florida to a joint venture of MINT Cannabis and SHANGO for approximately $5 million. The transaction, initially announced in August, includes a $3 million cash payment, a $2 million promissory note and an equity transfer of the MMTC license, which the company plans to divest.

"This sale is a key part of our ongoing strategy to streamline our portfolio and strengthen the balance sheet," said Hart. "Exiting Florida allows us to refocus resources on more profitable areas."

Operational Adjustments And 2025

Wholesale revenue rose by 2% in Q3, accounting for 17% of total revenue, up from 15% in Q2.

Ohio, in particular, contributed significantly following the state's transition to adult-use sales, with volumes nearly doubling across five retail locations.

Looking to 2025, The Cannabist Company is targeting an adjusted EBITDA margin above 20%, supported by a reduced footprint and new retail expansions in New Jersey, Virginia and Ohio.

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Price Action

The Cannabist Company closed on Wednesday at $0.1450 per share up 1.75%.

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