Jushi Posts Solid First Quarter As Revenue Growth Settles Down

Jushi Holdings Inc.  (CSE: JUSH ) (OTCMKTS: JUSHF ) reported its official financial results for the fourth quarter and the full-year ending December 31, 2020, plus the first-quarter 2021 ending March 31, 2021. Jushi had originally released unaudited results in April. Revenue increased 29.0% sequentially in the first quarter of 2021 to $41.7 million from $32.3 million in the fourth quarter. It missed analyst estimates slightly by $650,000.  Jushi said the increase in revenue was due to solid revenue growth at the BEYOND/HELLO stores in Pennsylvania and Illinois, early revenue contributions from its Virginia retail operations, and increased operating activity at its PAMS and Nevada facilities.

The first-quarter net loss was $26.8 million, or $0.18 per diluted share, versus a net loss of $156.7 million, or $1.35 per diluted share, in the fourth quarter This missed analyst estimates by $0.14. Jushi said the $129.9 million improvement in net losses was due to a decrease in fair value losses on derivative liabilities, along with higher revenue and gross profit.

Fourth Quarter

Revenue in the fourth quarter of 2020 also increased 29.6% sequentially to $32.3 million from $24.9 million in the third quarter. The quarterly increase was attributed to strong organic growth at BEYOND/HELLO stores in Pennsylvania and Illinois, an increase in cultivation and manufacturing activity due to the acquisition of Pennsylvania Medical Solutions and increased operating activity at its Nevada cultivation and processing facility. The fourth-quarter net loss was a whopping $156.7 million, or $1.35 per diluted share, a big jump over the third-quarter net loss of $30.0 million, or $0.31 per diluted share. The company blamed the increase in net losses to a derivative warrant liability prompted by the rise of its share price and an increase in operating expenses, partially offset by higher revenue and gross profit.

Full Year 2020

For the full year of 2020, revenue increased 689.6% to $80.8 million versus $10.2 million in 2019. Jushi said the increase in revenue was due to the expansion of its retail portfolio, including the addition of nine new stores during the year, and an increase in wholesale revenue, driven by the acquisition of PAMS and increased operating activity at its Nevada cultivation and processing facility. The full-year 2020 net loss was $211.9 million, or $2.11 per diluted share, compared to a net loss of $30.8 million, or $0.37 per diluted share, in 2019.

Looking Ahead

Mr. Cacioppo said in a statement, “For the second quarter of 2021, we expect revenues to be between $45 to $48 million and Adjusted EBITDA to be between $4 to $6 million. We continue to believe our strong momentum, enviable footprint, and solid balance sheet positions the company well to execute on its current plans and drive long-term shareholder value through 2021 and beyond.” This would mean revenues are slowing a bit as the previous two quarters saw revenues rise 29% sequentially. With this new estimate, revenues will only rise approximately 7% – 15%.

PA Expansion Continues

Yesterday, Jushi announced that its subsidiary, Franklin Bioscience would open the company’s 13th BEYOND / HELLO medical marijuana dispensary in Pennsylvania and its 20th BEYOND / HELLO dispensary nationwide. On Friday, June 11, 2021, BEYOND / HELLO Easton will begin serving Pennsylvania medical marijuana patients and caregivers.

“The first BEYOND / HELLO dispensary was opened in Pennsylvania, so it’s only fitting that we reach our 20th retail store milestone with the opening of our 13th medical marijuana dispensary in the Keystone State,” said Jim Cacioppo, Chief Executive Officer, Chairman and Founder of Jushi. “With the opening of our newest retail location, we have not only broadened access for more Pennsylvania patients, but we have also expanded the reach of our newly introduced suite of highly innovative branded products, including The Bank, The Lab, Nira+, Tasteology, and Seche. In the coming months, we look forward to deepening and enhancing our business in key Pennsylvania markets with the continued expansion of our store base.”

Debra Borchardt

Debra Borchardt is the CEO, Co-Founder, and Editor-In-Chief of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Masters degree in Business Journalism from New York University.


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