Curaleaf's Boris Jordan: No Capital Raises Planned, Company Has $50M In Revolving Credit

Price pressure has been a common theme in this past week's round of cannabis earnings. While Curaleaf Holdings Inc. CURLF was no exception, the company reported a positive second quarter with revenue at $339 million - a 4% YoY growth, which met street expectations. 

Balance Sheet Looking Good

"We ended the second quarter with $85 million in cash on the balance sheet and generated $37 million in year-to-date cash flow from continuing operations," stated executive chairman Boris Jordan who is a keynote speaker at the Benzinga Cannabis Capital Conference this coming Sept 27-28.

"As the U.S. industry regains its supply-demand equilibrium and we eagerly anticipate the game-changing catalysts on the horizon, we continue to control costs and remain focused on long-term growth opportunities, particularly in Europe and our advantage in Germany specifically," Jordan added. 

Droopy Prices

In a call with analysts to discuss the company’s results, CFO Ed Kremer and CEO Matt Darin agreed that pricing has been a significant contributor to gross margin erosion, which was especially true in Florida, Curaleaf’s largest market.

“Florida has been a market that we have continued to see increased promotional activity as you’ve had more players come online, more supply into the market, and a lot more dispensaries that have opened up for that medical market in advance of adult use,” said Darin who will also be on a panel at the upcoming Benzinga Cannabis Capital Conference in Chicago. 

Capital Strategy

Regarding capital strategy, Jordan told investors on the call, reported by Green Market report, that Curaleaf has no intention or sees any reason “at the moment” to do any large capital raises in that the company still has a $50 million revolving credit facility available if needed.

“We feel the capital build in the second half of the year is more than adequate to pay our bills for the company,” Jordan said. “However, we have constant offers for capital both from lenders and from obviously equity investors at these levels. But we have refrained from doing that.”

Come and meet Curaleaf and other cannabis CEOs, experts, advocates and investors at the Benzinga Cannabis Capital Conference in Chicago on September 27 and 28. All information is available on bzcannabis.com

Price action: Curaleaf shares were trading down 8.06% at $2.85 per share Friday afternoon.