Gage Growth Posts Q4 Earnings: What Cannabis Stock Investors Need To Know

Vertically integrated cannabis operator Gage Growth Corp. GAGE reported Thursday that it had generated $39.9 million in revenue at a gross margin of 30.8% in fiscal 2020, representing a 1,972% year-over-year increase.

The Ferndale, Michigan-based company, led by veteran cannabis industry executive Bruce Linton, also disclosed that its fourth-quarter revenue spiked 615% over the same period to $10.5 million.

Moreover, on April 20, the unofficial cannabis holiday, Gage generated over $500,000 in a single day with an average basket size of $171 and 2,956 total transactions.

Gage CEO Fabian Monaco said he is "thrilled with the results of our efforts. Throughout 2020, we worked to establish Gage as one of the leading vertically integrated cannabis companies in Michigan." 

Gage's Full-Year Financial Highlights

• Gross profit amounted to $12.3 million versus a $100,000 loss in 2019.
• Total operating expenses were $34.8 million, down by roughly 52% year-over-year.
• Net loss was $29.8 million versus a $75-million loss in the prior year.
• As of Dec. 31, 2020 Gage had $45.5 million in cash compared to $9.7 million in the last year.

Gage's Recent Moves

In January, the company secured some $50 million in financing by issuing 28.57 million subordinate voting shares at $1.75 each via a Regulation A offering, ahead of its debut on the Canadian Securities Exchange in April.

Gage expects to boost its cultivation footprint to 13 cultivation facilities by the end of 2021.

It also intends to launch its eighth dispensary in Battle Creek this week and two additional shops in May.

The company anticipates generating between $17 million and $18 million in revenue in the first three months of 2021 and between $26 million and $31 million in the second quarter.

"Overall, we are well-positioned to further scale our business and execute on our expansion strategy in 2021," Monaco added.