Tilray Archives - Green Market Report

StaffStaffMay 11, 2020
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4min1650

Tilray, Inc.  (Nasdaq: TLRY) delivered it financial results for the first quarter ending March 31, 2020, as revenue increased 126.2% to $52.1 million. The revenue beat analyst estimates by $2.45 million. The losses of $1.73 per share missed  estimates by $1.21

The company said that the growth was driven by cannabis sales, which experienced meaningful increases across all channels with the exception of bulk, and the inclusion of the Manitoba Harvest acquisition for a full quarter in 2020 compared to a partial quarter in the prior year.

Still, the net loss was a staggering $184.1 million, versus last year’s net loss of $29.4 million. While it looked bad, Tilray pointed out that it wasn’t as bad as the fourth quarter’s net loss of $219.1 million, or $2.14 per share, in the fourth quarter of 2019 was largely due to improvements in gross margin in the first quarter of 2020 and the significant impairments recorded in the fourth quarter of 2019.

The company also noted that the net loss was primarily due to the change in the fair value of the warrant liability of $72.0 million related to its registered offering of common stock and warrants, impairment of assets of $29.8 million. In addition to that, the company also blamed the weakening of the Canadian dollar resulting in a foreign currency translation loss of $28.1 million, increased operating expenses related to growth initiatives in the company’s cannabis sector, and severance costs of $1.9 million related to headcount reductions.

“We are pleased to report strong sequential quarterly revenue growth across each of our core business segments for the first quarter of 2020,” says Brendan Kennedy, Tilray’s Chief Executive Officer. “We remain focused on executing on our long-term growth opportunities and our goal of generating positive Adjusted EBITDA by the end of the fourth quarter. As evidenced by our International Medical sales in the quarter, we expect this segment to demonstrate continued growth and positively impact margins. During and since the first quarter, we took significant steps to drive efficiencies across our business, enabling us to realize annualized cost savings of approximately $40 million compared to fourth quarter 2019 run rates. While the positive impact of these actions are not fully reflected in this quarter’s results, they will become more clearly evident over the course of this year.”

The company said that it has not experienced any adverse material effects from COVID-19. It has implemented work from home strategies where it could and instituted social distancing and additional safety protocols.

Flower King

Tilray reported that its total cannabis kilogram equivalents sold increased by 92.4% to 5,794 kilograms from 3,012 kilograms in the first quarter of 2019. This growth resulted from increases in adult-use cannabis flower sales and the launch of Cannabis 2.0 products. The average cannabis net selling price per gram decreased to $5.28 (C$7.16) compared to $5.60 (C$7.54) in the first quarter of 2019. The decrease was due to a shift in product and channel mix. The average net selling price excluding excise duties for adult-use was $3.49 (C$4.73) per gram for the first quarter of 2020.

 


Debra BorchardtDebra BorchardtMarch 2, 2020
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3min6200

Tilray, Inc.  (Nasdaq:TLRY) stock got slammed in aftermarket trading after the company delivered its financial results for the fourth quarter and full fiscal year ending December 31, 2019. The stock was falling over 11% and was lately trading at $13.54 following a positive day of buying.

The company’s fourth-quarter non-GAAP EPS of -$0.62 missed by $0.24 and the GAAP EPS of -$2.14 missed by $1.80. Revenue of $46.94 million which increased by 202 % over last year also missed estimates by $8.58 million.

The net loss for the quarter was an eye-popping $219.1 million versus a loss of $31.0 million. Adjusted EBITDA was a loss of $35.3 million compared to a loss of $13.3 million in the prior-year period. The increased net loss and Adjusted EBITDA declines were primarily due to increases in operating expenses related to growth initiatives, expansion of international teams, and the addition of Manitoba Harvest and Natura Naturals businesses.

“Our full-year results demonstrate strong sales growth momentum, which we expect to continue in 2020,” said Brendan Kennedy, Tilray’s Chief Executive Officer. “Like our peers, we have faced industry challenges, but we remain committed to driving long-term value for our shareholders. Tilray has a diversified business model comprised of global medical, Canada adult-use and hemp products which position us well in the current volatile market environment. We are still in the early days of this emerging growth industry and will continue being good stewards of shareholder capital as we aim to build the world’s most trusted and valued cannabis and hemp company.”

Positives

On a positive note, the total cannabis kilogram equivalents sold increased over seven-fold to 15,039 kilograms from 2,053 kilograms in the prior-year period. The average cannabis net selling price per gram (excluding bulk sales) increased to $8.78 (C$11.43) compared to $7.52 (C$9.79) in the prior-year period. The average net selling price excluding excise taxes for adult-use was $3.19 (C$4.16) per gram for the fourth quarter of 2019. The increase was due to a shift in product and channel mix.

The company closed a $60 million senior credit facility on February 28, 2020, that bears interest at prime plus 8% and has a two-year term. Tilray ended 2019 with $97 million in cash.

 


Kaitlin DomangueKaitlin DomangueFebruary 19, 2020
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4min5940

It’s time for your Daily Hit of cannabis financial news for February 19th, 2020. 

On the Site

Cannabis Sustainability: Minimize Wastewater

Drought and water shortages are an expensive reality in some of the best cannabis-growing regions. As a result, water conservation practices help reduce water waste and overall operations costs, particularly for commercial grows.

Use Cannabis? Spotlight on Driving Unimpaired

The article went in-depth on what those who are pulled over with medical cannabis in Florida should do. Drivers must be able to produce a valid medical cannabis card. In other words, don’t leave your card at home. Drivers should also not drive with hemp/CBD without a certificate of analysis in the vehicle as well.

Zenabis to Produce Sparkling Beverages

Zenabis Global Inc. (TSX: ZENA)  announced details of its cannabis derivative product strategy and execution, including entering into an agreement with a Canadian beverage manufacturer to produce a range of cannabis-infused beverages.

The initial launch of cannabis-infused sparkling water beverages under the HYTN brand is listed with all Zenabis’ Provincial counterparties, with strong indicative demand. The first shipment of the initial four flavors of the cannabis-infused sparkling water beverages expected in Q2 2020.

Australis Kills Folium Deal

Australis Capital Inc. (CSE: AUSA) (OTC: AUSAF) terminated a proposed merger with Folium Equity Holding LLC and Folium Merger Sub, LLC.

Australis had sent warning signs that the company may not move forward with the deal in corporate meeting notes that surfaced on Google. In those notes, Dowty said, “It was concerning with the multiple lawsuits and all of the stuff on social media. After due diligence and getting to know the team at folium, we felt comfortable you know, with where they are going.”

Move Over Impossible Burger, The CBD Burger Is Next On The Menu

Even though the FDA has expressed its displeasure at adding CBD to food, that hasn’t stopped hamburger chains from tossing in some cannabidiol to enhance their burgers.

Carl’s Jr. became the first fast-food chain to sell a CBD burger for one day at one of its franchises in Denver, Colorado. That has sparked Colorado-based Illegal Burger to offer what it calls its biggest differentiator, “its exclusive line of CBD products.”

In Other News

TILT Holdings Revamps C-Suite

TILT Holdings has appointed interim CEO Mark Scatterday as the permanent CEO of the company. Tim Condor has been appointed as Chief Operating Officer, adding the title of President, effective immediately.

Tilray Stocks at a Low

Tilray (TLRY) has been one of the worst-performing stocks in the cannabis market in the last year. After their IPO price rising to $300 from $17, their luck ran dry and shares recently hit a low around $15. Estimates from analysts predict Tilray’s stock to fall.


Kaitlin DomangueKaitlin DomangueFebruary 12, 2020
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5min14210

Amid layoffs appearing as a constant, The Supreme Cannabis Company is the latest in the industry to let a percentage of its staff go. Last night after the market’s close, the company announced a 15% layoff, releasing a third of corporate positions and 13% of its operational ones. This report comes after the announcements of companies like Tilray and Aurora also slashing jobs. 

All hope is not lost though in the ganja workforce. Leafly found 243,700 full-time-equivalent (FTE) jobs in the United States that are supported by legal cannabis as of January 2020. That is a 15% annual increase. 

This data was reported in Leafly’s fourth annual Cannabis Jobs Report. Even more encouraging, the report shows that the industry created 33,700 new jobs nationwide in 2019, effectively making it the fastest-growing job arena in the United States. 

According to the report, Massachusetts, Oklahoma, and Illinois are leading the fight in terms of employment expansion. Massachusetts recently celebrated the one year anniversary of legalizing cannabis for adult-use in the state and added 10,226 jobs to boot. Oklahoma saw a 221% growth in 2019, supporting 9,412 full-time jobs. Illinois adult-use market rolled out on the first of the year, and early 2020 data shows this is already a $470 million annual market supporting 9,176 jobs.

An interesting tidbit of information, Massachusetts has more cannabis industry workers than hairstylists and cosmetologists, and Illinois has twice the number of cannabis industry workers than they do meat packers. When compared to other industries, it is truly amazing to see the creation of jobs in the United States by the industry, as well as the cannabis industry’s growth in general. 

Though the previously mentioned states take the prize for the fastest job growth, California is still America’s largest cannabis employer. However, Colorado may be the nation’s biggest per-capita cannabis job market. With California offering one job per 980 residents, Colorado supplies one job per 165 residents. 

Colorado is also passing Washington state in terms of jobs. Though both states legalized cannabis for adult-use in 2012, Colorado supplies nearly 10,000 more jobs than Washington state, despite Washington’s population containing nearly 2 million more residents. 

Despite cannabis job expansion’s rapid growth in most of the country, California and Michigan suffered technical job losses. 

Leafly’s experts estimate that their job markets fell due to changes in laws and regulations. In California, an estimated 8,000 jobs moved from legal to non-legal status, but as mentioned before it is still America’s largest cannabis job provider. Michigan’s new regulatory processes pushed hundreds of legally operating dispensaries into illicit status. 

Leafly started their annual job counts four years ago, upon the discovery that federal and state labor economists do not account for state-legal cannabis jobs in their employment reports. The reason? Federal prohibition. The NAICS (North American Industry Classification System) codes classify cannabis retail stores in the same category as art supply stores, hot tub stores, and auction houses. While cannabis cultivators have the same job code as hay farmers and agave growers. 

It is important to note that this report does not include jobs created by CBD since it’s recent change in legal status. Because the regulations for CBD differ from state-legal cannabis, there is no data to build from yet.


Kaitlin DomangueKaitlin DomangueFebruary 5, 2020
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3min4790

It’s time for your Daily Hit of cannabis financial news for February 5th, 2020. 

On the Site

Business Strategy For Psychedelic Companies

The Green Market Report hosted its first conference on Psychedelic Investing in New York City on January 24. This panel was titled “Business Strategy For Psychedelic Companies.

Journalist Jeremy Berke of Business Insider moderated this panel.

Atai Life Science CEO, Florian Brand, was on the panel along with Shlomi Raz, the founder of Eleusis. The two were joined by Dr. Terry Kelly, the CEO of Perception Neurosciences.

Tilray Restructures, Cuts Workforce, Stock Rises

Canadian cannabis producer Tilray (NASDAQ: TRLY) said it was restructuring and cutting roughly 10% of its workforce. The stock was moving almost 2% higher on the news in pre-market trading to $18.50.

“By reducing headcount and cost, Tilray will be better positioned to achieve profitability and be one of the clear winners in the cannabis industry, which will drive value for our investor and employee shareholders,” said Chief Executive Brendan Kennedy in a statement.

74% of CBD Buyers Own Pets

A new industry report from Nielsen (NYSE: NLSN) and cannabis data provider Headset has highlighted the impact of hemp-based cannabidiol (CBD) on the U.S. pet care market. According to the 2020 Pet Industry Green Paper by Nielsen and Headset, hemp-based CBD pet products will represent 3-5% of all hemp CBD sales within the U.S. by 2025.

Key takeaways:

  • Pet products have logged over $9.4 million in sales at regulated adult-use cannabis retailers in California, Colorado, Nevada, and Washington combined (Q1 2018 through Q3 2019).
  • To date, 24% of pet owners use hemp-CBD either for themselves, their pet(s), or for both.

In Other News

Aurora Cannabis to Cut Workforce By 10%

Cannabis company Aurora has announced they are cutting their workforce by 10%. Shares are down 1% after hours. This comes right after the announcement of Tilray’s plans to also cut their workforce by 10%.


Debra BorchardtDebra BorchardtFebruary 5, 2020
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3min6130

Following the close of the market on Tuesday, Canadian cannabis producer Tilray (NASDAQ: TRLY) said it was restructuring and cutting roughly 10% of its workforce. The stock was moving almost 2% higher on the news in pre-market trading to $18.50.

“By reducing headcount and cost, Tilray will be better positioned to achieve profitability and be one of the clear winners in the cannabis industry, which will drive value for our investor and employee shareholders,” said Chief Executive Brendan Kennedy in a statement.

“Tilray restructured its global organization to meet the needs of the current industry environment and for continued growth in 2020 and beyond,” read the statement.” These changes include an approximately 10% reduction in staff.”

“The tough decision to eliminate roles has not been taken lightly. We’re extremely grateful to our past and current employees for their contributions,” Kennedy said.

Kennedy also noted that the company would focus on its international medical cannabis business, science and research, the domestic recreational market and Manitoba Harvest hemp foods, a  company it acquired last year for $420 million.

The company made its first shipment to Israel at the beginning of January through an agreement with Canndoc Ltd. a wholly-owned subsidiary of InterCure Ltd. (TASE: INCR), through its wholly-owned subsidiary, a Portugal Unipessoal Lda. Tilray has also agreed to purchase up to 5 tonnes of GMP certified whole flower from Canndoc beginning in mid-2020. If future Israeli regulations allow, the whole flower will be shipped to Tilray’s Portugal facility and turned into a GMP-certified finished product to distribute across Europe. Otherwise, the whole flower will be developed into finished medical cannabis and distributed as a Tilray-Canndoc branded GMP-certified finished product in Israel to further support local supply needs

The news comes just two weeks after the company named two strategic hires: Jon Levin as Chief Operating Officer, who was formerly with Revlon, and Michael Kruteck as Chief Financial Officer, who was formerly with Molson Coors and Pharmaca. Mark Castaneda, Tilray’s current CFO, will take on the role of Strategic Business Development and continue to advise the company and assist in Kruteck’s transition.


StaffStaffJanuary 14, 2020
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3min6640

Canadian-based cannabis company Tilray, Inc. (NASDAQ: TLRY) has turned to the mainstream corporate world for its latest hires. The company has appointed former Revlon employee Jon Levin as its Chief Operating Officer, who was formerly with Revlon, and former Molson Coors employee Michael Kruteck as Chief Financial Officer. The company said that Kruteck’s appointment will be effective immediately after filing the Annual Report on Form 10-K for the year ended December 31, 2019. Mark Castaneda, Tilray’s current CFO, will shift to the role of Strategic Business Development.

“We are thrilled to have these experienced leaders join our team as we continue to disrupt the global pharmaceutical, alcohol, CPG and functional food and beverage industries,” said Brendan Kennedy, Tilray CEO. “Jon and Michael come to Tilray with extensive expertise in their respective fields and we look forward to their contributions as we pioneer the future of cannabis and hemp around the world.  As CFO, Mark has led the company through its IPO and substantial growth in the past couple years and we thank him as he transitions to a new strategic role with the company.”

Kruteck, CFO, served multiple senior financial roles at Molson Coors Beverage Company and most recently as CFO for Pharmaca Integrative Pharmacy. With over 30 years of experience, Kruteck possesses a broad finance background with specific experience in financial and operational transformations, supply chain, corporate finance, and financial planning and analysis. Michael received his MBA from the Garvin School of International Management (Thunderbird) and his B.A. from the University of Colorado at Boulder.

Levin, COO, joins Tilray from Revlon where he most recently was General Manager, U.S. Mass Markets, responsible for the consumer products sold through major retailers in the United States. With 25 years of experience, Levin has general management knowledge in diverse industries including beauty and health, CPG and sporting goods. Prior to Revlon, he was the Executive Vice President, Sales, for Ferrara Candy Company, and had senior sales leadership positions with Nautilus, Wrigley and Acosta. Levin has a B.S. in Economics from Portland State University and a degree in Executive Management from Cornell University.


StaffStaffNovember 14, 2019
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4min5370

Republished with permission from Thinknum Alternative Data

by Joshua Fruhlinger

The blooming weed industry promised massive revenues, a nascent agrarian industry, a booming supply chain, and soaring local taxes. While it has delivered on all of those things in limited fashion, recent earnings calls from market leaders like Tilray ($NASDAQ:TLRY) have analysts and investors worried that we may be seeing an early floor — or at least normalization — of the industry’s ability to earn as prices settle and operational costs become reality.

Yesterday, Tilray reported a third-quarter net loss of almost $36 million, or 36 cents per chare. That’s up from last year when it reported losses of $19 million, or 20 cents per share. That said, revenue rose to $51.1 million from $10.1 million.

But skyrocketing losses are the focus of investors today, and they appear to have a lot to do with sinking weed prices. Tilray reported that the average price per gram of weed it sold sunk from $6.21 to $3.25.

Tilray isn’t alone here: The price of weed across the industry has been dropping, including at Tilray competitor OCS — Ontario Cannabis Store ($ONTARIOCANNABISSTORE) — where we have pricing data for the past few months.

At OCS, the price of 3.5- and 7.0-gram non-CBD products is showing a steady decline, mirroring that of Tilray and other companies in the space. Since August, the average price has dropped from $13 to $11.42.

While Tilray points to higher operational costs and the acquisition of Manitoba Harvest and Natura Naturals, declining prices will only continue to squeeze revenue and subsequent earnings.

The company has entered a bit of a hiring slowdown as it picks up the pieces as well – openings are down as much as 33% since last summer as the stock price inches to the $20 mark.

About the Data:

Thinknum tracks companies using the information they post online – jobs, social and web traffic, product sales and app ratings – and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.


Debra BorchardtDebra BorchardtNovember 12, 2019
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3min13940

Canadian-based Tilray, Inc. (Nasdaq: TLRY) reported that second-quarter revenue increased 371.1% to $45.9 (C$60.9) million versus last year’s $9.7 million. Tilray said that the increase in revenue was driven by the Manitoba Harvest acquisition, the legalization of the Canadian adult-use market, and growth in international medical markets, particularly in Europe. Excluding excise tax, revenue was $42.0 (C$55.8) million.

Net Losses Rise to $35 Million

The company delivered a net loss for the quarter of $35.1 million or $0.36 per share versus last year’s loss of $12.8 million or $0.17 per share. The adjusted net loss for the quarter was $31.2 million or $0.32 per share for the second quarter of 2019. The adjustments to the net loss are non-recurring acquisition-related charges and a non-recurring non-cash charge related to purchase accounting for the fair value of inventory. Adjusted EBITDA was a loss of $17.9 million compared to a loss of $4.7 million the prior-year period. The company said that the increased net loss and Adjusted EBITDA declines were primarily due to the increase in operating expenses related to growth initiatives, interest expense from our convertible notes, the addition of Manitoba Harvest and Natura businesses, and the expansion of international operations.

“We are pleased with our second-quarter results and strong business momentum,” said Brendan Kennedy, Tilray President, and Chief Executive Officer. “Our team has executed against our plan, with adult-use revenue nearly doubling in the second quarter compared to the first quarter and gross margin increasing sequentially for the second quarter in a row. As we continue to grow, we remain focused on our long-term strategic objectives and deploying capital to maximize stockholder value.”

Prices Fall

The average net selling price per gram decreased to $4.61 (C$6.12) versus last year’s $6.38 (C$8.36). The decrease was due to a reduced mix of higher-priced extract products and a greater mix of adult-use revenue, which are at lower prices per gram compared to other channels. Total kilogram equivalents sold more than tripled to 5,588 kilograms from 1,514 kilograms in the prior-year period.

 

 


William SumnerWilliam SumnerSeptember 11, 2019
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4min5560

It’s time for your Daily Hit of cannabis financial news for September 11, 2019.

Medicine Man Technologies

Medicine Man Technologies, Inc. (OTCQX: MDCL) has entered into a binding term sheet to acquire the cannabis operator Strawberry Fields for $31 million. The acquisition is comprised of $14 million in cash and $17 million in common stock, priced at $2.98 per share. “The integration of Strawberry Fields into our family of Colorado pioneers will be impactful,” said Andy Williams, Co-Founder and CEO of Medicine Man Technologies. “This transaction will provide our Company with low-cost cultivation assets located in Pueblo, a growing manufacturing facility, and branded products. In addition we will be acquiring four retail locations in Western and Southern Colorado, including a high yielding store that is a leader in that part of the state. Adding Strawberry Fields to our portfolio will strengthen our strategy to become the leading integrated cannabis operator of Colorado.”

Tilray

After the market close yesterday, Tilray Inc. (NASDAQ: TLRY) announced in an 8k-filing that it has selected Cowen and Company to sell up to $400 million in stock once an S-3 registration statement is effective, with any sales to be an “at-the-market offering.”

Vapen MJ

Vapen MJ Ventures (OTCQX:VAPNF) announced the appointment of Arizona Attorney Scott A. Hill to the company’s advisory board. Hill is a patent attorney and former stock broker licensed to practice law in the state of Arizona and in the United States District Court for the District of Arizona. “Scott was instrumental in successfully working with the USPTO for Vapen MJ’s utility patent for our Cannabinoid Inhaler without a heating element. Scott crafted the claim in the filing, which makes the recently granted patent as broad as possible,” commented Thai Nguyen, Founder and CEO of Vapen MJ.

Aurora Cannabis

Aurora Cannabis (NYSE: ACB) announced the release of its financial results for the fourth quarter, ending on June 30, 2019. Net revenue for the quarter rose by 61% to $94.6 million. The cost-per gram sold declined t0 $1.14. The gross margin was 58% and adjusted EBITDA was a loss of $11.7 million. “In 2019 Aurora took its place as the global leader in cannabis production, research, innovation, and international market development. We are executing on all our strategic priorities,” said Terry Booth, Aurora CEO. “Our best in class cultivation methods allow us to grow consistent, high-quality cannabis at scale.”



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