4Front Ventures Archives - Green Market Report

StaffMay 30, 2023


The Daily Hit is a recap of the top financial news stories for May 30, 2023.

On The Site

Two Dozen Publicly Traded U.S. Cannabis Companies Lost $4 Billion Last Year

Two dozen of the top plant-touching publicly traded marijuana companies in the United States posted a cumulative financial loss of more than $4 billion in 2022 against nearly $9 billion in revenue, according to analysis of filings by Green Market Report. Read more here.

New York Cannabis Regulators Propose Settlement for Lawsuit Hindering Retail Licensing

New York marijuana industry regulators on Tuesday gave initial approval to a settlement deal that is intended to end a legal fight that has stalled retail cannabis permits in the Finger Lakes Region. Read more here.

Numinus Wellness Shares Soar as Landmark Clinical Study of Psilocybin Therapy Begins

Numinus Wellness Inc. (TSX: NUMI) announced on Tuesday that its subsidiary, Cedar Clinical Research, has begun studying a potential new therapy for treatment-resistant depression (TRD) using COMP360 psilocybin. As a result, shares of NUMI jumped more than 30% to lately sell at 19 cents on the news as of the Phase 3 trial was released on Tuesday morning. Read more here.

Entourage Health Revenue Rises on Pre-Rolls, Medical Marijuana

Entourage Health Corp. (TSX-V: ENTG) (OTCQX: ETRGF) announced Tuesday a 24% sequential increase in revenue for the first quarter of 2023 ending March 31, with a significant contribution from its medical cannabis stream and adult-use pre-roll sales. Read more here.

YourWay Cannabis Can’t Find An Auditor For Filings

YourWay Cannabis Brands Inc. (CSE: YOUR)(OTC: YOURF) has been delayed in issuing its financial reports because it can’t find an auditor. The company said that since the resignation of its previous auditor Macias Gini & O’Connell LLP in December 2022, it hasn’t been able to find a replacement. Read more here.

In Other News


Surrounded by dozens of cheering people in green clothes, Minnesota Democratic Gov. Tim Walz signed a bill Tuesday to legalize recreational marijuana for people over the age of 21, making Minnesota the 23rd state to legalize the substance for adults. Read more here.


Ohioans 21 and older would be able to cultivate, purchase and possess marijuana if a bipartisan bill passes in the Ohio Statehouse, possibly circumventing a ballot measure campaign to force legalization through. Read more here.

North Carolina

A North Carolina state House of Representatives committee has taken up a medical marijuana legalization bill already approved by the state Senate, and activists are hopeful this year the state may embrace MMJ. Read more here.

StaffSeptember 26, 2022


The Daily Hit is a recap of cannabis business news for Sept. 26, 2022.


California Regulator Says Illegal Cannabis Business Should Pay $128 Million

California’s cannabis regulation authority wants a group of business owners to pay $128 million in collective penalties for manufacturing and selling unlicensed products in the state for more than a year – which the state says the defendants admitted in court. Read more here.

Green Thumb Accused of Sex and Age Discrimination

Green Thumb Industries (OTC: GTBIF) was accused of sex and age discrimination by a former employee that worked in a Rise dispensary in Pennsylvania. Carrie Baker filed the complaint on Sept. 22 alleging that she was “forced out” for not fitting with the corporate culture, which was described to her as young, single men. Baker is in her mid-fifties and said she was passed over for a shift supervisor role given to a substantially younger male co-worker. Read more about the case here.

Hemp-Derived Delta-8 Skirts Laws, Raises Health Concerns

At least a dozen states have banned the hemp-derived product, including Colorado, Montana, New York and Oregon, which have legalized marijuana. But delta-8 manufacturers call the concerns unfounded and say they’re driven by marijuana businesses trying to protect their market share. Read more here.

Incubator 1871 to Launch Cannabis Program

1871 is getting into weed. The startup incubator at the Merchandise Mart plans to launch a cannabis-industry innovation lab, bringing startups together with larger companies. The four-month program will launch in January in partnership with Grown In, a Chicago-based startup focused on providing cannabis training. Read more here.

Berner’s Cookies Heads to Pennsylvania, Wiz Khalifa Takes on Florida

TerrAscend said that it has entered into a multi-year agreement with TRP – the cannabis holding and operating company with the exclusive rights Cookies products – to cultivate and manufacture Cookies products in the Keystone State. Read more.

Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) will launch Khalifa Kush medical cannabis products in Florida this weekend — part of an exclusive partnership with multi-platinum selling artist Wiz Khalifa. Read more.


UK-Based Cannabinoid Product Producer Looks to Acquire Cannaray Brands, Love CBD Health

Cellular Goods (LSE: CBX), UK-based wellness company providing lab-produced cannabinoid products, has signed a letter of intent to acquire Cannaray Ltd, the owner of Cannaray Brands Ltd and Love CBD Health Ltd. Under the terms of the deal, Cellular Goods will complete a reverse takeover of the Cannaray subsidiaries and acquire 100% of the issued share capital. Read more here.

Amazon Still Says No to Drugs, Boots Marijuana Businesses

Amazon says its guidelines around drugs and drug paraphernalia are longstanding and state that products can’t be primarily designed for making, preparing or using a controlled substance. For example, grinders that are equipped with features specifically for marijuana-related use are not allowed on the platform. Read more here.

4Front Ventures Launches Premier California Cannabis Brand in Massachusetts

4Front Ventures Corp. (CSE: FFNT) (OTCQX: FFNTF), a vertically integrated, multistate cannabis operator and retailer, has brought its premier California cannabis brand, Island Cannabis Co., to Massachusetts. Following the company’s acquisition of Island in April, 4Front began cultivating 11 new Island flower strains at its state-of-art flower facilities located in Holliston, Georgetown and Worcester, Massachusetts. Read more here.

Adam JacksonAugust 15, 2022


After the market closed on Monday, 4Front Ventures Corp. (CSE: FFNT) (OTCQX: FFNTF) posted positive results — buoyed by growth from lucrative M&A deals over the past year. The vertical multi-state operator announced its financial results for the second quarter ended June 30, 2022.

4Front delivered approximately $34.5 million in total revenue during the period, versus $34.4 million the same period last year — beating the Yahoo Finance Average analyst estimate for revenues of $27 million. The gain is primarily due to increased revenue in the company’s wholesale revenue as it ramps portions of its business in California, Illinois and Massachusetts.

The earnings per share remained at a loss of one cent — in line with both the pervious quarter and the same time last year.

“Throughout the second quarter and now halfway through the third quarter, we are seeing an acceleration of business trends within our growth markets, particularly in Massachusetts and California,” said CEO Leo Gontmakhert. “Our retail locations platform-wide maintained or gained market share, despite anticipated pricing headwinds as we continue to expand our customer base with new product innovations and quality improvements. We believe we are poised for a significant leg of growth to take place over the next 12 months as we leverage our investments in state-of-the-art automation and scaled manufacturing processes, supplemented by strategic and accretive M&A.”

4Front posted an adjusted EBITDA of $9.2 million in the quarter, up 23% from the same time last year — representing an adjusted EBITDA margin of 26.7%. The company said that continued growth of adjusted EBITDA and margins is expected to persist through 2023 as the company’s operations drive increased production and higher sales volumes without material increases to overhead.

The company had $6.0 million of cash and $49.5 million of related-party long-term debt not due until May, 2024. It has 636,636,686 subordinate voting shares outstanding.

4Front also announced that it has signed a definitive agreement to acquire the California-based Bloom Farms brands. The company said it will complete the transaction with Bloom Farms in the coming weeks, and expects to announce similar acquisitions over the next several quarters.

“In the distressed and fragmented California market, we are seeing increased interest from companies looking to 4Front as their low-cost producer of choice,” said Gontmakhert. “Our long-term plans are to deepen and expand these relationships to grow revenue over time and add a retail presence in the state.”

4Front said at the start of the fiscal year that it continues to believe that wholesale growth in both Massachusetts and Illinois is poised to strengthen over the year “as additional retail comes online in those underserved states.”

“After implementing new techniques and methodologies to our production processes in Massachusetts, we made notable improvements to the yield and quality of our flower across the country during Q2,” Gontmakhert said about the progress since then. “These new processes have now been incorporated in Massachusetts and Illinois, and we are currently applying them to our facilities in Washington. As the construction of Phase 1 of our Illinois cultivation and production facility nears completion, we are looking to expand our retail footprint in the state over the coming months in preparation for that facility to commence operations in 2023.”

“We are excited by the momentum we have seen so far in Q3, and I am convinced that the next twelve months will demonstrate the power of our model at significant scale, paving the way for robust, sustained growth in the long term,” said Gontmakhert.

Debra BorchardtApril 25, 2022


Cannabis investors have seen stock prices tumble even as cannabis companies report increasing sales. Green Market Report recently asked some leaders in the cannabis industry how they felt about the market in general despite the market pessimism.

Brandon Pollock, CEO and Co-founder of Theory Wellness

Theory Wellness, Inc. is an independently owned and operated vertically integrated cannabis brand. The company operates retail, cultivation, and product manufacturing across Massachusetts and Maine, including the cannabis-infused seltzer brand Hi5. 

  • Leading analysts have recently projected reduced short-term cannabis industry growth, with a less than optimistic outlook for federal reform. Do you agree with this projection?

From our view, no, we feel as optimistic as ever about the growth and future of regulated cannabis and have no concerns about the trajectory of the market. In our view, stock market prices are not a good indication of actual on-the-ground performance and the expectations of many independent operators. Especially on the East Coast, we’re expecting explosive growth in the next few years as New York, New Jersey, and Connecticut implements adult-use sales. On the Federal side, it’s only a matter of time before cannabis becomes legal, as it is one of the policies most supported by the American populace.

  • What may be causing the current market pessimism? 

Generally, it seems this pessimism has risen from the sluggishness of Federal reform coupled with the underperformance of publicly traded cannabis companies. We’ve seen multiple large-scale multi-state operators (MSOs) posting revenue misses or struggling with profitability. From our view, we are slightly surprised by how much the market seems to value Federal changes in law, as many organizations are not prepared to handle such a monumental shift in the first place, and many businesses ascribe significant value to the moats they build around themselves on a state-by-state basis – especially in markets with limited numbers of licenses. 

  •  Do you agree with analysts who are saying that the current landscape will help MSOs consolidate the industry? If so, what is the projected industry impact? 

We would generally disagree – many consolidation strategies and deals are based on using stock as currency, and with depressed stock prices and heightened uncertainty of the future, many independent operators will be wary of deals that may have looked attractive twelve months ago. The only exception may be increased activity from smaller publicly traded companies combining all stock transactions with larger counterparts.

  • When can we expect market projections to turn back around? Federal legalization prospects?

On a macro scale, both are contingent on one another. The larger MSOs betting big on legalization cast the most considerable shadow over the industry. Until legalization starts to loom, market forecasts may not brighten. However, we still believe that smaller independent operators in the industry might be running with a narrative contrary to the gloomy forecast surrounding the largest operators.

Andrew Thut, Chief Investment Officer at 4Front Ventures

Headquartered in Phoenix, AZ, 4Front Ventures Corp. (CSE: FFNT) (OTCQX: FFNTF) is a national, vertically integrated multi-state cannabis operator with operations in strategic medical and adult-use cannabis markets, including California, Illinois, Massachusetts, Michigan, and Washington. 

  • Leading analysts have recently projected reduced short-term cannabis industry growth, with a less than optimistic outlook for federal reform. Do you agree with this projection?

It’s true that MSOs and cannabis stocks, in general, have sold off over the last year, but there’s a bigger question here: are companies struggling from a business perspective? Right now, there is a risk-asset sell-off and overall market volatility. As such, growth stocks like those involving MSOs, for example, have been selling off. Perceptions around the larger cannabis markets have also been under pressure recently. Take sentiment around California as an example; challenges such as pricing pressures, oversupply, and the illicit market continue to affect confidence in the sector. We feel differently here at 4Front, and see the huge opportunity to take advantage of those same perceived challenges and have focused accordingly. Production of low-cost, high-end products with scale efficiencies is a proven 4Front strategy that will allow us to build real value in the largest cannabis market in the world, while challenging public perspective along the way. 

  • What may be causing the current market pessimism? 

Our view is that current market sentiment is due to SAFE banking and cannabis liberalization being stalled, temporarily we believe, at the federal level. Legalization and liberalization will be major steps forward, but at the end of the day, they won’t transform enough of the sector to prevent risk-asset sell-off; ultimately, strong and reputable companies will be the ones to do that. Meanwhile, we can’t just sit idly by and wait for wide-sweeping federal reforms to be enacted. When Biden won, there was a lot more optimism that such reforms would be enacted – but with a split Congress, intense party allegiances, and the unwillingness of politicians to work with their counterparts across the aisle, reform measures have stood in limbo. This has led to disillusionment among investors, which has further hindered industry momentum. Whether you’re talking about 4Front, the folks at Cresco, Trulieve or another top-performing MSO, we are all going to continue focusing on building robust businesses, optimizing our production processes, building consumer awareness and loyalty, and strengthening our fundamentals. 

  • Do you agree with analysts who are saying that the current landscape will help MSOs consolidate the industry? If so, what is the projected industry impact? 

We agree with those analysts who believe the current landscape will help MSOs consolidate the industry. Smaller companies with less capital and less efficient processes will benefit from being acquired by larger companies that have optimized production and scaling capabilities. In the case of 4Front, we feel the innovative automation processes we’ve developed in California at our state-of-the art Commerce facility could easily be applied to a broader portfolio and an even larger footprint, realizing nearly immediate value in a consolidated model. We know that other operators have similarly improved their processes, which will lead to further inevitable consolidation. Increased consolidation will bring greater efficiencies and innovation, which will ultimately benefit consumers as prices will be more affordable and there will be more refined, higher quality, consistent products on the market. 

  • When do we expect market projections to turn back around? Federal legalization prospects?

Even as the House just passed SAFE banking for the sixth time, it is yet again doubtful that the Senate will follow suit before the midterms. Without SAFE banking, US institutional investors are still locked out of the market. Their hands are tied. But on the flip side, this presents a huge opportunity for retail investors, who under normal circumstances would only hear about companies like 4Front after all institutional money has already flowed in.

I have spent a lot of time on the buy-side in the small-cap space, and what we’re seeing in U.S. cannabis is truly unique. No other industry has as many quality high-growth companies with solid fundamentals and sustained profitability with such low valuations. With that in perspective, investors’ concerns about the future of cannabis are a bit shortsighted. Investors need to focus on well-run, well-capitalized, promising cannabis companies with good long-term prospects, and then adopt a buy and hold strategy. Eventually, the wider market will care – and when it does, it will care a LOT. To get ahead, I think investors need to think about 4Front and the other MSOs as they would a business in any other sector: you’re buying a share of a business – is the business solid? At 4Front, we’re growing and doing it in a way that supports the bottom line; on top of this, investors should keep the following in mind: cannabis is a kicker that will provide a huge upside when inevitable regulatory reform passes.

Robert McEvoy, Vice President of Customer Success, Corporate Development, and Government Affairs at Agrify Corp.

Agrify Corp. is a rapidly growing developer of premium grow solutions for the indoor agriculture marketplace. 

  • Leading analysts have recently projected reduced short-term cannabis industry growth, with a less than optimistic outlook for federal reform. Do you agree with this projection?

The notion that cannabis outlooks are less than rosy is inconsistent with national acceptance perspectives, high-profile celebrity involvement, and increased M&A and investment activity. Looking ahead, more and more states are actively considering implementing adult-use sales, establishing medical programs, or expanding existing markets. Over the last year, New Jersey and New York have taken significant steps in launching adult-use programs projected to be multi-billion dollar markets for each state. States such as Ohio and Oklahoma have not only built robust medical industries but have created profitable single-state operators primed for expansion in and out of state. Further, the new wave momentum of purpose-built companies and products that focus on social equity, sustainable agriculture, and delighting an increasingly segmented customer base, is fostering a fertile environment for existing brands to be reborn, and providing new-to-world products an inclusive space to succeed.

  • What may be causing the current market pessimism? 

Short-term cannabis faced two impactful circumstances back-to-back over the last two years: a vaporizer crisis fueled by illicit products making consumers sick, and a global pandemic resulting in lockdowns and supply chain problems. That said, state regulators’ mistrust of unfamiliar vaporizer products was met with credible lab-based testing and transparency in operator quality control programs – each of which bolstered consumer confidence and highlighted bad actors, both legal and illegal. Counterfeit and cheap products have penetrated non-regulated consumer channels for centuries, so I can’t realistically call adverse reactions to carelessly made, non-tested illicit products with harmful additives an unforeseen circumstance. However, accurate and informative health and safety campaigns should have been carried out more responsibly, particularly by state agencies tasked with helping the public differentiate between safe, lab-tested products and non-compliant mystery oil. Regarding the pandemic, clearly its global presence and reach were unexpected – but beginning in February 2020, operators throughout the industry had a choice: either acknowledge and proactively plan for an unknown timeline of the virus’ impact, or continue business as usual with minimal adjustments, troubleshooting as time goes on. A large part of succeeding in this industry is accepting unpredictability and remaining operationally nimble.

  • Do you agree with analysts who are saying that the current landscape will help MSOs consolidate the industry? If so, what is the projected industry impact? 

Consolidation is an inevitability of any industry, no matter the commodity or service that is monetized. While MSO acquisitions will continue, so will the development of joint venture partnerships between single state operators creating rapid multi-state market share. There’s an increase in new state initiatives aiming to empower local residents, small to midsize businesses, and regionally popular brands through micro-licenses with future expansion capabilities and uncapped operator counts. In terms of industry impact, why should we think cannabis CPGs would be any different from the multitude of products currently produced by large and small companies alike? Ultimately, the customer is in control of where they spend their money and what they spend it on. The industry will continue to be shaped by operators who listen to their customer base in all aspects, from production practices to lifestyle identity. 

  • When can we expect market projections to turn back around? Federal legalization prospects?

My optimism has never left the market potentials and projections discussion. In fact, with brand licensing, white labeling, contract services, and expanded licensing categories to include onsite consumption and home delivery, more growth opportunities exist today than ever before. As for federal legalization, prospects have never been within industry grasp, and will not be any time soon. I think it is more likely that states with similar programs that share borders will build governmental coalitions to allow for interstate transport, shared resource allocation, and tax collection, placing consequent pressure on the federal government to act before the legislative and executive branches enact reform on their own.

Brooke Butler, VP of Partnerships, Simplifya

Headquartered in Denver, CO, Simplifya is the leading advanced technologies and software platform powering regulatory and operational compliance for owners, operators, insurers, law firms, municipalities, governments; regulatory bodies; and cannabis-related banking and financial institutions with remaining compliant under FinCEN Cannabis Banking Guidance. 

  • Leading analysts have recently projected reduced short-term cannabis industry growth, with a less than optimistic outlook for federal reform. Do you agree with this projection?

While certain parts of the cannabis industry may have experienced a downturn, others like our business saw steady to accelerated growth. There has certainly been disappointment and disillusionment over the Biden administration not enacting legalization at the federal level, but I expect more states to take legalization into their own hands, making federal reform less and less of a growth hindrance. Just because there is currently market volatility and risk-asset sell-off, this does not reflect the overall health of the cannabis sector. In fact, we expect to see continued growth as several key markets such as New York, New Jersey, New Mexico and more are in the process of getting their adult-use programs off the ground and running, increasing consumer access to legal cannabis. 

  • What may be causing the current market pessimism? 

There were high expectations after the 2020 national election that the incoming Biden administration would push for federal reform, at least on some level, but the lack of movement on that front has disappointed a lot of investors. While I personally had a more hopeful outlook for some widespread cannabis reform being enacted at the federal level, I was not surprised by the market reaction and how quickly sentiments changed when it became clear federal reform likely wouldn’t pass before midterms. Even aside from cannabis, the stock market as a whole is performing poorly, and investors have been selling their shares in promising companies that are not yet profitable. Expectations have lowered across the board and this has exacerbated the downward pressure on cannabis stocks. 

Many investors seemed to think federal legalization would be a magic bullet without which the industry would suffer – however we have seen that is not the case. Cannabis companies are still blazing forward, optimizing their strategies and fortifying their business. Due to the hindrances brought on by the lack of federal legalization, cannabis companies have been forced to be agile and tactical to compete, and this has bolstered the sector as a whole. While ultimately we’re striving for federal legalization, to really get capital into the space, legalization alone will not suffice. Institutional investors need effective means of vetting companies to recognize worthy prospects. The way we’ll get there is with more companies utilizing RegTech solutions to demonstrate their compliance and organizational strengths.

  • Do you agree with analysts who are saying that the current landscape will help MSOs consolidate the industry? If so, what is the projected industry impact? 

Yes, I think we will undoubtedly continue to see consolidation in the industry. Interest rates are projected to rise and smaller companies will have an even harder time accruing the capital necessary to build out operations and scale, so they will benefit by being acquired by larger, more established companies. On the flip side, given the fractured regulatory landscape and the fact that interstate commerce is not on the horizon, larger companies will benefit from acquiring smaller companies that already have operations in place in states they want to enter. Larger cannabis companies are not banking on interstate commerce becoming a reality anytime in the imminent future, so they’re opting for M&A to foster growth in new markets.  That being said, I hope we see individual states helping to lower the barriers to entry for social equity licensees and smaller operators so we can establish a balance as the industry continues to grow. M&A should not be the only path forward for small businesses to survive.

  • When do we expect market projections to turn back around? Federal legalization prospects?

It is difficult to surmise when optimism will return to the market, as you never know with politics how things are going to shake out, but I do think people will look to see if and how cannabis reform is framed and discussed leading up to the midterm elections. The election results, as well as the rhetoric candidates use to discuss cannabis, will give us a clearer projection on what the path to federal legalization will look like. Outside of federal legalization efforts, you have to keep an eye on SAFE Banking; if that passes, it would make a huge positive impact on market sentiment.

Rob Sechrist, President of Pelorus Equity Group and Co-Manager of the Pelorus Fund

Headquartered in Newport Beach, CA, Pelorus Equity Group is the largest privately held provider of value-add bridge commercial real estate loans to entrepreneurs operating cannabis-use properties. The Company’s Pelorus Fund, a private mortgage real estate investment trust (“mREIT”), offers a range of innovative transactional solutions addressing the diverse needs of real estate investors and portfolio managers.

  • Leading analysts have recently projected reduced short-term cannabis industry growth, with a less than optimistic outlook for federal reform. Do you agree with this projection?

Yes and no. Last year, we experienced 434% year-over-year growth, and many other ancillary businesses also saw astounding growth in the sector. With operators moving into new states, much of our growth was fueled by a surge in build-outs, expansions and improvements. Some analysts in the marketplace may be failing to take a hard look at the long-term growth that we expect to see when these buildouts are operational. On paper, that revenue is not yet online for many of the operators, but it will be. So while there’s a mix of companies that are currently seeing sustainable growth and others that are lagging behind, this is only part of the story. Analysts should consider innovative companies that have not yet achieved growth but are expected to in the near future. Long term, we are confident that the sector will be one of the best growth opportunities in a generation. 

  • What may be causing the current market pessimism? 

Though the cannabis industry has added hundreds of thousands of jobs, millions in tax dollars, and large-scale infrastructure projects without receiving government handouts, the current administration appears reluctant to use any remaining political capital on driving cannabis legislation. Unfortunately, despite the public comments supporting cannabis reform during the run up to the last election, government inertia in this sector is far from surprising; it’s certainly caused a lot of disillusionment and pessimism, which has been holding back the industry as a whole. One way for the current administration to signal to the country that they are pro-cannabis would be to reinstate the Cole Memo, which was rescinded in 2018. The Cole Memo laid out key guidelines for what federal representatives should focus on in enforcing cannabis, which created a sustainable framework where legal cannabis industries and federal enforcement agencies could peacefully coexist. The rescission brought more uncertainty and fear in the eyes of investors; if the government were to reinstate, this would bring about more optimism in the cannabis space. 

  • When do we expect market projections to turn back around? Federal legalization prospects?

Perhaps this is a bit bleak, but I think the prospect of federal legalization will likely only be attainable once the next administration, whether it be Democrat or Republican, has majority control of both the House and the Senate. The stark divide between parties has unfortunately become a defining characteristic of modern American politics, and as a result, progress for cannabis on the federal level has been at a standstill. In the meantime, we need to keep educating investors and shift general rhetoric away from the notion that federal legalization will be a catch-all to uplift this industry. There are many cannabis companies that have managed to thrive without federal legalization and this demonstrates the ingenuity and agility that characterizes much of the sector. If investors focus more on company fundamentals and specific state legislative actions that open the doors to more prosperity in the cannabis space, there will be revitalized optimism


Debra BorchardtMarch 30, 2022


4Front Ventures Corp. (CSE: FFNT) (OTCQX: FFNTF) announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2021. The company reported that GAAP revenue increased 68% year-over-year, and 10% sequentially to $28.5 million in the fourth quarter. 4Front did not disclose whether it had a net loss or income for the quarter, while it did say adjusted EBITDA for the quarter was $13.2 million, up 160% from the same time period in 2020.

For the full year of 2021, GAAP revenue increased 81% year-over-year to $104.6 million. The net loss reported by 4 Front was $34.9 million for the year, an improvement over 2020’s net loss of $47 million. The company also said that cash flow from operations increased to $7.4 million in FY 2021 as compared to a loss of $14.0 million in FY 2020.

“Our fourth-quarter results showed strong year-over-year growth, representing steady execution in the face of macro headwinds and reinforcing our thesis of consistent, low-cost production at scale,” said Leo Gontmakher, Chief Executive Officer of 4Front. “2021 saw substantial operational achievements within our company which continue to set the stage for a considerable ramp in production and sales growth through 2022 and beyond.”

In the fourth quarter, 4Front announced its proposed acquisition of NECC, which was subsequently completed in late January 2022 following approval by the Massachusetts Cannabis Control Commission. The acquisition of NECC’s state-of-the-art 55,000 square foot cultivation and production facility significantly bolsters 4Front’s strategic position in the core Massachusetts market and expands the Company’s institutional knowledge of lighting, airflow, and fertigation techniques. The transaction enables the broader penetration of 4Front’s diverse range of low-cost, high-quality products and brands, and increases its scale to enable wholesale operations in the state.

“Revenue growth in our Massachusetts operations will be greatly bolstered by the closing of the acquisition of New England Cannabis Corporation (‘NECC’) in late January, which more than doubled our total flowering canopy and nearly tripled our kitchen, processing and distribution space. Additionally, the cultivation practices developed by the NECC team were already operating at what we believe to be the industry’s highest standards. Coupled with our advanced production methodologies, we believe we will be a formidable wholesaler in the competitive Massachusetts market. As the integration of NECC continues to ramp over the coming weeks, we are intent on further increasing the market penetration of our award-winning brands in the state in the near term.”

Island Cannabis

Earlier today, 4Front announced it was buying Island Cannabis Co. for an undisclosed amount.

“This acquisition of Island is the first step of a broader California strategy that supports our earlier decision to construct what we believe is one of the cannabis industry’s largest and most efficient processing centers,” said 4Front CEO Leo Gontmakher. “Island is widely recognized for its high-quality, diverse line of pre-rolls, flower and infused products, and has been remarkably successful in building a loyal following in the extremely competitive California market. Once integrated into 4Front’s Commerce facility, we can reduce production costs and scale volume of the Island Cannabis Co. brand. This will accelerate Island’s growth by making a respected brand even more attractive to California retailers and consumers. We are also ecstatic to have Founder and CEO, Ray Landgraf, COO, Brandon Mills, and the Island leadership team join the 4Front family. We believe our Company’s success in acquiring and retaining talent to our management team is imperative to value creation.”

Debra BorchardtNovember 17, 2021


4Front Ventures Corp. (CSE: FFNT) (OTCQX: FFNTF) announced its financial results for the third quarter ended September 30, 2021 with total revenues of $25.9 million, topping last year’s $12 million for the same time period for a gain of 70%. However, the company experienced a 4% sequential drop in sales from the second quarter. The company blamed the decline in sales to permitting delays during the local review process for both the Commerce, CA facility and Brookline, MA dispensary. The revenue was also short of the Yahoo Finance average analyst estimate for revenue of $27 million. The net loss for the quarter was $4.5 million, which was slightly higher than last year’s $4 million. 

“While we experienced some regulatory delays in getting Commerce up and running, we are more confident than ever that we have the tools, facilities, and teams in place to meet our considerable growth expectations in the coming year,” said Leo Gontmakher, Chief Executive Officer of 4Front. “During the quarter we made meaningful progress in the development of our three key growth markets of CaliforniaIllinois, and Massachusetts. In Illinois, we officially broke ground this summer on the construction of our cultivation and production facility in Matteson. Construction of the facility is expected to last through 2022, with Phase 1 anticipated to come online in the first quarter of 2023, offering 4Front’s in-house brands and products to the growing retail and wholesale markets in the state.”

Delays In California

4Front also reported that its third-quarter adjusted EBITDA grew 103% year-over-year to $7.5 million, up from $3.7 million in 2020 for the same time period. This was flat when compared to the second quarter, representing an Adjusted EBITDA margin of 23% as compared to Adjusted EBITDA margin of 22% in second quarter. “While higher overall dispensary sales and increased sales of the company’s internally produced products continue to drive systemwide margin improvements as designed, meaningful quarterly EBITDA growth predicated on a fully operational California manufacturing facility was temporarily hindered due to delays in the local review process for the Commerce facility.

4Front’s branded and wholesale manufactured products will be sold to licensed dispensaries in California via its partnership with Nabis, a leading distributor of cannabis products covering 100% of licensed retailers in the state. The facility is currently producing nine of 4Front’s 20 brands and 164 different SKUs including gummies.

“During the quarter we made meaningful progress in the development of our three key growth markets of CaliforniaIllinois, and Massachusetts,” Mr. Gontmakher added. “In Illinois, we officially broke ground this summer on the construction of our cultivation and production facility in Matteson. Construction of the facility is expected to last through 2022, with Phase 1 anticipated to come online in the first quarter of 2023, offering 4Front’s in-house brands and products to the growing retail and wholesale markets in the state.”


Debra BorchardtOctober 15, 2021


Viridian Capital Advisors analyst Jonathan DeCourcey is looking into his cannabis crystal ball and says skip 2022 – it’s 2023 that should be the focus for investors. He points out that 2023 will be the first full year with adult-use cannabis sales in the key markets of Connecticut, New Jersey, and New York. He wrote,

Based on 2023 expectations, top operators are likely to look much cheaper overall than they do today.

The analyst said that the cannabis market’s current bear market is unwarranted and presents buying opportunities. While company estimates for 2022 have been increasing, he says the real story will be what happens in 2023. He wrote, “As we look to 2023, the opportunity becomes even more favorable. Even omitting the share gains for large public players (both through execution and consolidation) and conservatively growing estimated 2022 revenues by the roughly 20% growth rate for broader US cannabis sales in 2023 and leaving adjusted EBITDA margin levels unchanged from 2022 estimates, US cannabis companies will be trading at a roughly 50% discount to the one year forward projections of this winter with 2023 multiples (’23EV/Sales at 2.1x and EV/EBITDA at 6.3x). These valuations levels are incommensurate with the high growth nature of US cannabis and look inexpensive even relative to slower growth more mature industries.”

In his opinion, many of the companies considered to be the top operators for 2023 are not necessarily the biggest by market cap or the most expensive today. His big list of companies that he believes look even better when considering the 2023 numbers are Ascend Wellness, Ayr Strategies, Body & Mind, Cansortium, Columbia Care, Glass House, Goodness Growth, Jushi, TerrAscend, and Tilt Holdings. The two companies DeCourcey specifically highlighted in his report that was published on October 15, was 4FrontVentures (OTC: FFNTF) and Planet 13 (OTC: PLNHF).


Viridian has a Buy rating on 4Front and a $2 target price. The analyst noted that the 2022 estimates only represent about 40% of the company’s long-term plans. 4Front recently broke ground on a cultivation and production facility in Illinois called “Big Daddy.” The first phase of this project will be a 250,000 square foot cultivation facility that will open in early 2023 giving the company 65,000 square feet of cultivation versus its current 9,000 sq. ft. today. This expansion will allow 4Front to sell more house brands at its own locations, plus open itself up to wholesale business. The company has said that the initial buildout will allow it to produce $100 million of sellable product.

In addition to Illinois, the Massachusetts operations are expanded by a recent acquisition of  New England Cannabis Corporation. 4Front said that NECC is expected to be significantly accretive to its EBITDA expectations for 2022 and will immediately scale 4Front’s presence as a dominant wholesaler and producer in the state. The acquisition is said to more than double 4Front’s total flower canopy in Massachusetts to over 30,000 sq. ft, with further expansion potential for up to an additional 10,000 sq. ft. of canopy, and will approximately triple 4Front’s kitchen, processing, and distribution space.

4Front also has an outstanding license application in New Jersey, which could also present a big opportunity. DeCourcey also pointed out that 4Front could end up being a potential takeover target by a larger MSO.

Planet 13

Planet 13 was truly beaten up by the pandemic. As a dispensary superstore that thrived on tourist traffic, the lockdown was especially difficult. Fast forward to today and Vegas is coming back. The MJ Biz conference next week is sure to bring lots of attention to the flagship store in Las Vegas and could be a short-term catalyst for the stock. Beyond that, the company has also opened a superstore in California.

Yet the analyst stated that right now, Planet 13 appears expensive as it has an EV/EBITDA multiple of 13.8x or a roughly 81% premium to the broader peer group. Still, he doesn’t think the 2022 outlook tells the whole story for the retailer. Looking even further out to 2023 results, Planet 13 has plans to open another store in Chicago now that it has a license through a joint venture and it acquired a Harvest license in Florida.

“We anticipate additional expansion even beyond those two initiatives coming given the company’s well-capitalized balance sheet and management’s stated initiative of having at least eight Superstore locations open within the next five years,” wrote the analyst. He suggested Planet 13 could potentially buy smaller assets that could be built out and more stores in tourist-friendly cities. He also thinks Planet 13 could be a target for a larger MSO to acquire.


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