4Front Ventures Reports Third Quarter Financial Results, Provides Business Update

4Front Ventures Corp. FFNT FFNTF, a vertically integrated, multi-state cannabis operator and retailer with offices in Phoenix, Arizona, announced its financial results for the third quarter ended September 30, 2021, late Wednesday afternoon.

Q3 2021 Financial Results Highlights Vs. Q3 2020

• Systemwide Pro Forma Revenue of $33.1 million compared to $22.3 million in Q3 2020, an increase of 48% year over year and a decrease of 4% from the second quarter of 2021
• GAAP-reported revenue of $25.9 million, an increase of 70% year over year and a decrease of 4% from the second quarter of 2021
• Adjusted EBITDA of $7.5 million, an increase of 103% year over year and flat as compared to the previous quarter. 
• Adjusted EBITDA margin of 23% as compared to an Adjusted EBITDA margin of 22% in the second quarter of 2021

"In the third quarter we reached several substantial operational milestones that we believe have set the table for our growth well through 2022 and beyond," said Leo Gontmakher, CEO of 4Front.

"We have consistently stated that the advantages to our low-cost, scalable operations are most readily apparent when applied over a large platform. Our team's diverse skill set combined with our compelling asset base in strategic markets has given us significant momentum coming into the end of 2021, and I am more confident than ever that 4Front is positioned for scaled growth in 2022."

Q3 2021 Operational Highlights and Current Developments

California:

The Company's state-of-the-art 170,000 square-foot production facility in Commerce, California is now open and operational following delays experienced during the local approval process. Scaled production and inventory build began this month with initial weekly production volumes in excess of those currently achieved in the Company's market-leading Washington facilities. Pre-commercial sales activity has been strong and the first revenues were achieved this week.

"In California, we are happy to announce that our highly anticipated 170,000 square foot manufacturing facility in Commerce is now open, operational, and currently manufacturing nine of 4Front's 20 brands and over 160 different products. We will be providing our suite of high-quality, branded products and wholesale goods to licensed dispensaries through our partnership with Nabis, a leading distributor in the California market," noted Gontmakher.

Illinois:

The Company closed the first phase of its multiphase expansion project of an up to 558,000 square foot new cultivation and production facility in Matteson, Illinois. The construction of a 350,000 square foot cultivation and production facility began in the third quarter of 2021 and is expected to be completed by the end of 2022 and begin operations in 2023.

Massachusetts:

In August, the Company opened its third adult-use dispensary, Mission Brookline, serving the Allston Innovation Corridor, a community within the wider Boston University and Boston metropolitan area.

The Company announced a definitive agreement in October to acquire New England Cannabis Corporation (NECC) and its fully operational 55,000 square foot cultivation and production facility, more than doubling 4Front's total flower canopy and tripling the current processing and manufacturing space in the state upon closing.

Price Action

FFNTF stocks traded 2.65% lower at $1.10 at the time of writing late Wednesday afternoon.

Photo Courtesy of Avery Meeker on Unsplash