GrowGeneration Q4 Revenue Declines 22% Sequentially To $90.6M

GrowGeneration Corp. GRWG reported record fourth quarter and full year 2021 financial results. Revenues were $90.6 million in the fourth quarter 2021 compared to $61.9 million in the same period last year, and revenues were $422.5 million for the full year 2021 compared to $193.4 million for the full year 2020, an increase of 118%, including the contribution from acquisitions.

GrowGeneration, the largest chain of specialty hydroponic and organic garden centers with 63 locations across 13 states. also reported fourth-quarter 2021 GAAP net loss of $4.1 million compared to net income of $1.5 million in the same period last year. Diluted loss per share in the fourth quarter was ($0.07) compared to diluted earnings per share of $0.03 in the same period last year. GAAP net income for the twelve months ended December 31, 2021 was $12.8 million, compared to net income of $5.3 million for the twelve months ended December 31, 2020.

Adjusted EBITDA for the twelve months ended December 31, 2021 was $34.5 million, compared to $18.9 million for the twelve months ended December 31, 2020, an increase of $15.6 million or 82%.

"In order to position the company for 2022 and beyond, we have made several strategic decisions to drive margin improvements and EBITDA. As of December 31, 2021 our balance sheet remains strong with $81 million of available liquidity," stated Darren Lampert, GrowGen's co-founder and CEO. "Given our view of the business today and the continued challenges across the US market, we expect to generate full year revenue of $415 to $445 million in 2022."

Financial Highlights for Fourth Quarter 2021 Compared to Fourth Quarter 2020

• Net revenues increased 46% to $90.6 million for fourth quarter 2021, compared to $61.9 million for the same period last year.
• Same-store sales at 26 locations open for the same period in 2020 and 2021 were $40.3 million in fourth quarter 2021, compared to $46.0 million in the same period last year, representing a 12.3% year-over-year decline.
• Gross profit margin for the fourth quarter 2021 was 25.5%, compared to 25.8% in the same period last year, a decrease of 30 basis points.
• GAAP net loss was $4.1 million or $(0.07) per share based on a diluted share count of 58.4 million, compared to net income of $1.5 million in the same period last year, or $0.03 per share on a diluted share count of 51.6 million.
• Adjusted EBITDA was a loss of $1.9 million for the fourth quarter 2021, versus earnings of $5.5 million in the same period last year.
• Cash and short-term securities as of December 31, 2021 were $81.2 million.

Financial Highlights for Twelve Months Ended December 31, 2021 

• Net revenue for the twelve months ended December 31, 2021, were $422.5 million, compared to $193.4 million for the twelve months ended December 31, 2020, an increase of $229.1 million or 118.5%.
• Gross profit margin was 28.0% for the twelve months ended December 31, 2021 compared to 26.4% for the twelve months ended December 31, 2020 an increase of 160 basis points.

• Full Year 2022 Outlook

• Net revenues* in the range of $415 million to $445 million, versus the 2021 base of $422.5 million.
• Adjusted EBITDA* in the range of $30 million to $35 million versus the 2021 base of $34.5 million.