Verano Q3 Revenue Slips, Losses Widen Amid Retail Decline In Key States

Verano Holdings Corp. VRNOF reported its financial results Thursday for the third quarter ended Sep. 30, 2024, revealing revenue (net of discounts) of $216.68 million, compared to $240.09 million in the same period last year.

The Chicago-headquartered cannabis operator attributes the decrease in revenue to declines in Florida retail due to a temporary shift in cultivation output, in addition to expected declines in Illinois and New Jersey retail as dispensaries continue to open across the state.

"During this election season, for the first time in history, cannabis took center stage as a key bipartisan issue for both U.S. presidential candidates and millions of voters across the nation," stated George Archos, Verano founder, chairman and CEO. "Despite the Amendment 3 outcome, it was encouraging to see the measure supported by a majority of Floridians with 56% voting in favor, and we remain optimistic on our growth prospects in the state and our ability to succeed in the current environment.”

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Q3 Financial Highlights

• Gross profit was $109.1 million, compared to $133.22 million in the third quarter of 2023.
• Net loss amounted to $42.57 million, which compares to net loss of $17.84 million in the corresponding period a year ago. The increase in net loss for the third quarter 2024 compared to the third quarter 2023 was largely driven by declines in income from operations.
• Adjusted EBITDA was a gain of $64.46 million, compared to $89.35 million in the same quarter last year.
• SG&A expense of $92 million or 43% of revenue.
• Net cash provided by operating activities of $30 million.
• Capital expenditures of $57 million.

“With rescheduling proceedings set to commence in December, and additional dispensary openings planned across multiple markets, we are prepared to leverage potential catalysts in the months and years ahead at the state and federal levels,” Archos continued. “Given his prior supportive comments, we look forward to working with President-elect Trump and his administration to advance the rescheduling process and much-needed reforms, including tax relief and SAFER banking."

2024 Guidance

The Company expects organic trends similar to those seen in the third quarter 2024 to continue into the fourth quarter 2024.

Price Action

Verano shares closed Wednesday's market session 31.17% lower at $2.23 per share.

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Photo: Courtesy of C.Aphirak via Shutterstock