How Verano Has Pulled Off Positive Operational Cash Flow In Nine Consecutive Quarters

We’ve been busy reporting on earnings season in the cannabis industry, and in this latest TDR Cannabis Exclusive on The Dales Report, we dive deeper into the latest earnings report of Verano VRNOF, a leading multi-state cannabis operator based out of Chicago, Illinois. Joining us to discuss Verano’s earnings and how the company has stayed cash flow positive is Chief Investment Officer Aaron Miles.

Verano has pulled through 9 consecutive quarters of positive cash flow, 6 of which have been positive from a free cash flow perspective. Aaron acknowledges upcoming choppiness of the margin profile, but he says the company is projecting between 50 and 75 million from a free cash flow perspective this year. This is something, he says, Verano is extremely proud of.

Good cost control, double digit growth and free cash flow is great news and a step in the right direction in cannabis companies, but these are challenging times, and some investors are looking for net income positive positions. Currently, Verano is not guiding to net income.

Nevertheless, it’s not hard to see why the company is excited about heading into Q2. Verano is busy positioning ahead of Maryland, which they consider a legacy state. Plans are also in the works for New Jersey and Connecticut. Of course, the SAFE Banking discussions happening in DC and Senator Elizabeth Warren’s comments are also adding to the sense that things are beginning to happen.

While Verano’s sitting on $95m in cash, the bulk of their debt matures in 2026. That could mean that changes in the market position may be in the company’s future. What are the company’s next steps to maintain its good market position? We’ll be discussing their strategy to keep their target growth, upcoming opportunities they might venture, and how the company plans to position itself in the industry in 3 years time.

We also explain how stock prices affect the reflection of the overall health of the industry and correct these misconceptions. Verano has yielded revenue with an adjusted SG&A rate of 26%, a good projectile while staying afloat in a volatile industry. What could this mean for the cannabis space and what can investors anticipate to the company’s impressive finance standing?