NewLake Capital Tenant Issues Cloud Yearly Revenue Growth

The company's first-quarter results were in line with their revenue guidance.

NewLake Capital Partners Inc. (OTCQX: NLCP), a provider of real estate capital to state-licensed cannabis operators, reported its financial results Tuesday for the first quarter ended March 31, revealing a slight sequential decrease in revenue but an increase year-over-year.

The Connecticut-based company disclosed first-quarter revenue of $11.4 million, a decrease of 6.8% from the $12.2 million reported in the fourth quarter of 2022. The primary cause of the fall was nonpayment of contractual rent from one tenant.

Despite the quarterly decrease, the first-quarter revenue reflects a 12.3% increase from the $10.2 million posted in the first quarter of 2022.

NewLake’s net income attributable to common stockholders was $5.9 million, compared to $6.7 million in the previous quarter and $5 million in the first quarter of 2022. The company’s funds and adjusted funds from operations for the first quarter were $9.5 million and $9.9 million, respectively, indicating decreases from the previous quarter but increases year-over-year.

Anthony Coniglio, NewLake’s president and chief executive officer, said in a statement that the company’s first-quarter results were in line with their revenue guidance. The company also maintained its quarterly dividend of 39 cents per share of common stock, marking a conservative adjusted funds from operations payout ratio of 86%.

NewLake took active steps to enhance shareholder value in the first quarter, repurchasing nearly 50,000 shares of its common stock at a favorable valuation. Additionally, the company invested about $350,000 to acquire an adjacent parcel of land to expand its cultivation facility in Missouri.

One tenant failed to pay rent, which NewLake said it is working toward a resolution that might include rent deferrals or other concessions. As of March 31, the company held cash and cash equivalents worth $41.5 million, with $17.9 million committed to fund tenant improvements.

The company also reported its financing activities, including $1 million in borrowings under the revolving credit facility, leaving $89 million available to be drawn. The facility bears a fixed rate of 5.65% for the first three years, followed by a variable rate.

NewLake made an annual principal payment of $1 million in January 2023. The remaining principal payment of $1 million is due in January 2024. As of March 31, 2023, the company was in compliance with the covenants of the agreement.

Adam Jackson

Adam Jackson writes about the cannabis industry for the Green Market Report. He previously covered the Missouri Statehouse for the Columbia Missourian and has written for the Missouri Independent. He most recently covered retail, restaurants and other consumer companies for Bloomberg Business News. You can find him on Twitter at @adam_sjackson and email him at

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