Curaleaf Holdings, Inc. (CSE: CURA) (OTC: CURLF) reported its financial and operating results for the fourth quarter and full year ended December 31, 2018 after the market close on Wednesday. The fourth quarter total revenue of $32 million increased 49% sequentially and 408% over the 2017 fourth quarter. Curaleaf delivered a net loss of $16.5 million, a steep drop from the previous quarter’s loss of $33 million, but the company reported a gain of $600k in the fourth quarter of 2017.
“2018 was a landmark year for Curaleaf. We successfully completed the largest ever U.S. cannabis RTO, experienced substantial growth, and have firmly set the foundation to capitalize on the shift in public sentiment toward cannabis in the U.S. and capture key expansion opportunities in 2019,” said Joseph Lusardi, Chief Executive Officer of Curaleaf. Lusardi continued, “Curaleaf has become the most accessible national cannabis brand with the largest operational branded dispensary footprint in the country and the recent launch of our CBD line under Curaleaf Hemp. We’ve done this through our strategic presence in highly populated, limited license states, which has served as an important foundation for our aggressive expansion plan across the country.”
Curaleaf opened seven new dispensaries during the quarter in key markets such as Florida and Arizona.
The total revenue for the full year 2018 increased 298% to $77.1 million versus $19.3 million in the year ending 2017. Retail and wholesale revenue increased 514% to $57.5 million, compared to $9.4 million.
Full-year 2018 managed revenue was $87.8 million, compared with $28.4 million in managed revenues for the full year 2017. The increase was primarily derived from organic growth in Florida, the opening of three dispensaries in New York and the acquisitions in Massachusetts in March and Arizona in April.
Gross profit before the impact of biological assets for the full year 2018 was $45.9 million, compared to $11.5 million for 2017, resulting in a gross margin of 60%. The significant increase was due to improved operating capacity of the Company’s cannabis business as acquisitions were integrated and new dispensaries opened. Gross profit on cannabis sales were $26.4 million for the full year 2018, resulting in a 46% margin, compared to $1.5 million in the full year 2017.
The company raised $400 million in a private placement offering and debuted as a public company on the Canadian Securities Exchange on October 29, 2018
Neil Davidson, Chief Financial Officer of Curaleaf, added, “Curaleaf’s rapidly growing footprint is a direct result of our strong capital position, scaled operations and ability to strategically acquire assets that augment our existing platform.”
Curaleaf reaffirmed its full-year 2019 outlook for managed revenue of $400 million and free cash flow of $100 million. The company said it plans to continue to grow its operations via expansion in three dimensions: acquiring licenses in limited license markets, increasing presence in current markets, and increasing exposure in mass markets. The company expects acquisition-related costs, marketing and selling expenses, and capital expenditures to increase as it expands its presence in current markets and expands into new markets.