Trulieve Archives - Page 2 of 3 - Green Market Report

Debra BorchardtApril 13, 2021
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Florida-based Trulieve Cannabis Corp .  (OTCQX: TCNNF) is continuing its expansion efforts and the latest state to plant its flag is West Virginia. Trulieve has acquired Solevo Wellness West Virginia LLC (“Solevo”) and its three West Virginia dispensary permits for $650,000. Solevo was awarded two permits in Morgantown and one in Parkersburg in January 2021 as part of the West Virginia application process.

“This acquisition enables Trulieve to broaden and solidify our position in the newly created West Virginia market. Solevo was granted three dispensaries as part of the application process entered by the company before becoming part of the Trulieve family. Adding Solevo to our production and dispensary permits, as well as our recently announced definitive agreement to acquire Mountaineer Holdings and its cultivation and dispensary permits, will create a fully vertical presence in the state with nine dispensaries,” said Kim Rivers, CEO of Trulieve. “We look forward to providing the highest level of cannabis products and customer experience through authentic and reciprocal relationships to West Virginia patients.”

West Virginia Has  A Long Way To Go

West Virginia is currently a medical-only state and at this time residents can only register for access to medical marijuana. The state still needs to partner with a testing lab before any products will be available for sale. Patients have to have approval from a doctor and so far, only 30 physicians in the state are eligible to approve a person for medical marijuana. It was four years ago that medical marijuana was legalized in the state, but patients still can’t get it. The state has managed to issue licenses for growers, processors, and dispensaries.

Recently legislators were unable to pass a law decriminalizing adult-use cannabis as fears of such a move meant full legalization.

Matt Simon, a senior legislative analyst for the Marijuana Policy Project, told The Center Square, “Patients in West Virginia have been waiting a long time for safe, legal access to medical cannabis. It has been nearly four years since Gov. Justice signed the medical cannabis bill into law, and there’s no reason the rollout should have taken this long. Other states have been able to implement similar programs in a fraction of the time it has taken West Virginia. Still, the fact that dispensaries have finally been licensed and patients are finally able to register for the program is an important step forward. We look forward to the day that patients will finally be able to obtain medical cannabis from dispensaries in West Virginia.”


StaffApril 9, 2021
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FRANKLIN SQUARE, NY -April 9, 2021 /AxisWire/ With the 50th anniversary of ‘420’ just around the corner, Trulieve, Florida’s largest chain of medical marijuana treatment centers, is celebrating one year of collaboration with celebrity country music band “The Bellamy Brothers.”

In 2020, Trulieve created a new brand called the “Old Hippie Stash.” The Bellamy Brothers David and Howard hand selected attributes for three stains of medical cannabis.

The three strains of medical marijuana available only at Trulieve are “Reggae Cowboy,” “Afterglow,” and “Big Love.” The Reggae Cowboy and Big Love strains are Sativa hybrids, while Afterglow is a straight Indica to promote relaxation and can help with pain relief.

Valda Coryat, Trulieve’s Chief Marketing Officer, along with David and Howard Bellamy (The Bellamy Brothers) were interviewed by Lori Reese of MarijuanaDoctors.com via Zoom. The live interview shares a candid discussion that fans will want to hear. From life on the “Honky Tonk Ranch” to the changing role of medical cannabis as an alternative medicine. The award-winning musical duo also talks about the country music talents that were lost due to COVID-19, and their songs about the pandemic, including “Rednecks Looking for Paychecks” and “No Country Music for Old Men.” A tribute to Kenny Rogers, Charlie Pride, and other legendary country crooners.

The one-year anniversary of the “Old Hippie Stash” is April 9th. The Bellamy Brothers and Trulieve are celebrating by giving away 15 gift boxes for fans. Participants (USA only and 21-years of age and older) can enter on the MarijuanaDoctors.com blog post about the interview: https://www.marijuanadoctors.com/blog/bellamy-brothers-1st-anniversary-interview/

Winners will be randomly selected and announced by MarijuanaDoctors.com on Facebook, on Monday April 12th.

—————————————-

MarijuanaDoctors.com is America’s original online resource for medical cannabis information — Since 2010! Patients who want to get their medical card can find practitioners in each of the thirty-six states where medical marijuana is legal. Find a doctor & get your card. Learn if telemedicine medical card health evaluations are available in your state, at MarijuanaDoctors.com.

Contact:

Vincent B. Donadio

Marketing Director

Marijuana Doctors

donadio@marijuanadoctors.com

(516) 217-2712


StaffApril 9, 2021
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In 2020, Trulieve created a new brand called the “Old Hippie Stash.” The Bellamy Brothers David and Howard hand selected attributes for three stains of medical cannabis.

With the 50th anniversary of ‘420’ just around the corner, Trulieve, Florida’s largest chain of medical marijuana treatment centers, is celebrating one year of collaboration with celebrity country music band “The Bellamy Brothers.”

The three strains of medical marijuana available only at Trulieve are “Reggae Cowboy,” “Afterglow,” and “Big Love.” The Reggae Cowboy and Big Love strains are Sativa hybrids, while Afterglow is a straight Indica to promote relaxation and can help with pain relief.

Valda Coryat, Trulieve’s Chief Marketing Officer, along with David and Howard Bellamy (The Bellamy Brothers) were interviewed by Lori Reese of MarijuanaDoctors.com via Zoom. The live interview shares a candid discussion that fans will want to hear. From life on the “Honky Tonk Ranch” to the changing role of medical cannabis as an alternative medicine. The award-winning musical duo also talks about the country music talents that were lost due to COVID-19, and their songs about the pandemic, including “Rednecks Looking for Paychecks” and “No Country Music for Old Men.” A tribute to Kenny Rogers, Charlie Pride, and other legendary country crooners.

The one-year anniversary of the “Old Hippie Stash” is April 9th. The Bellamy Brothers and Trulieve are celebrating by giving away 15 gift boxes for fans. Participants (USA only and 21-years of age and older) can enter on the MarijuanaDoctors.com blog post about the interview: https://www.marijuanadoctors.com/blog/bellamy-brothers-1st-anniversary-interview/

Winners will be randomly selected and announced by MarijuanaDoctors.com on Facebook, on Monday April 12th.

 


Debra BorchardtApril 5, 2021
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Florida-based Trulieve Cannabis Corp.  (OTCQX: TCNNF) is making a big move in Pennsylvania with the acquisition of Keystone Shops from Anna Holdings LLC in a deal valued at $60 million. Keystone has locations in PhiladelphiaDevon, and King of Prussia. The deal consists of $40 million in Trulieve stock and $20 million in cash.

Kim Rivers, Trulieve CEO said in a statement, “Trulieve continues to bolster our national expansion efforts with acquisitions that both complement our current portfolio and strengthen our long-term strategy. The Keystone Shops are located in a densely populated area of Pennsylvania and with their staff’s knowledgeable and customer-centric approach to patients, these dispensaries are valuable additions to our Pennsylvania portfolio.”

The acquisition will add three fully operational dispensaries in the Philadelphia area to Trulieve’s retail footprint of 83 dispensaries nationally. It will also expand Trulieve’s footprint in Pennsylvania, the fifth most populated and limited-license state, adding to Trulieve’s existing operations in Pennsylvania. At this time, the state is only legal for medical marijuana, while the neighboring state of New Jersey will begin selling adult-use cannabis as early as this year. It is anticipated that once New Jersey begins these sales, it could steall sales from Pennsylvania residents.

Just a few weeks ago Trulieve reported annual revenue of $521.5 million for 2020, representing year-over-year growth of 106%. For the full year, the company reported a net income of $63.0 million resulting in full-year earnings per share of $0.53 on a fully diluted basis.

Pennsylvania Holdings

In November, Trulieve completed the acquisition of PurePenn LLC and Pioneer Leasing & Consulting LLC, which the company refers to collectively as PurePenn, and (ii) Keystone Relief Centers, LLC, which is known as Solevo Wellness. PurePenn operates cannabis cultivation and manufacturing facilities in the Pittsburgh, Pennsylvania area and currently wholesales the PurePenn and Moxie brands to 100% of the operating dispensaries in Pennsylvania. As of December 31, 2020, PurePenn has 35,000 square feet of cultivation space, which the company said it plans to expand to 90,000 square feet in the first half of 2021. Solevo Wellness operates three medical marijuana dispensaries with approximately 16,000 square feet of retail space, each with six points of sale, in the Pittsburgh, Pennsylvania area.

Pennsylvania Market

Pennsylvania licenses three different types of marijuana organizations: dispensaries, grower-processors, and clinical registrants. A clinical registrant license allows the license holder to grow, process, and dispense medical marijuana in conjunction with an accredited medical school. The Commonwealth’s Medical Marijuana Act authorized the Department of Health to issue up to 25 grower-processor licenses and 50 dispensary licenses. The Department of Health is authorized to license up to eight clinical registrants and has licensed seven thus far. The Department of Health has the discretion to expand the number of dispensary and grower-processor permits as necessary.

No person may own more than five individual dispensary permits. A permit may be used to dispense medical marijuana at up to three locations as approved by the Department. Pennsylvania issued 27 dispensary licenses during Phase I of its medical marijuana program. Applicants were allowed to apply to operate up to three dispensary locations in a given region. Ten licensees obtained approval to open three locations, five licensees obtained approval to open two locations, and the remaining twelve licensees gained approval to open one location.

During Phase II, Pennsylvania issued 23 dispensary licenses, with four licensees obtaining approval to open two locations and fifteen obtaining approval to open one location (none obtained approval to open three locations). Notable competitors include Columbia Care, GTI, Curaleaf and Harvest who controls 12 dispensaries.  According to Arcview/BDS Analytics, the Pennsylvania market is expected to grow to $770 million by the end of 2025, a CAGR of 10.6%, from 2019.

 


Debra BorchardtMarch 23, 2021
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Trulieve Cannabis Corp. (OTCQX: TCNNF) announced revenue grew 111% to $168.4 million for the fourth quarter ending December 2020 versus last year’s revenue of $79.7 million for the same time period. This beat the average analyst estimate for $162 million according to Yahoo Finance. Trulieve‘s net income fell 75% to $3 million for the quarter versus $12.2 million for the same time period in 2019. 

For the full year, Trulieve delivered revenue of $521.5 million, representing year-over-year growth of 106%. For the full year, the company reported a net income of $63.0 million resulting in full-year earnings per share of $0.53 on a fully diluted basis. Absent the revaluation of our debt warrants, an impact of $42.7 million for the year, adjusted net income would have been $105.7 million resulting in earnings per share of $0.89 on a fully diluted basis, which beat estimates by $0.38.

“2020 was a year of foundational growth that sets the stage for what we expect will be an exciting and transformational year of national expansion. We had an excellent fourth quarter with strong financial performance capping off our highest annual revenue, net income and Adjusted EBITDA year to date. Our results reflect the outstanding work we’ve accomplished as a company and our focus on continuous improvement. Our full-year Adjusted EBITDA in 2020 was nearly equal to our prior year revenue,” stated Kim Rivers, Trulieve CEO.

Trulieve also reported that its 2020 Adjusted EBITDA of $251.0 million, was a year-over-year growth of 99%. The adjusted EBITDA of $78.2 million in the fourth quarter was an increase of 19% from the third quarter. The company delivered $99.6 million in cash flows from operations for the year.

Outlook

Based on Trulieve’s markets, current regulations, and foreseeable store growth, the company estimates 2021 revenues in the range of $815 million to $850 million, and $355 million to $375 million in adjusted EBITDA. Guidance for 2021 incorporates a full year of operations from Trulieve’s  Pennsylvania operations, continued growth in Florida as well as the Company’s Massachusetts, Connecticut, and California locations.

Operational Highlights

The company listed the following operational achievements in a statement:

  • Approved to start growing plants at our Tier 9 facility in Holyoke by the Cannabis Control Commission in Massachusetts.
  • Expanded national footprint in the Northeast with closings of the acquisition of Solevo Wellness, adding three operational dispensaries in Pennsylvania, and PurePenn, a cultivator and processor supplying wholesale product to 100% of dispensary operations in the state.
  • Entered a 6 th state with the award of a processor permit by the West Virginia Office of Medical Cannabis and four dispensary permits subsequent to year-end. Announced a Definitive Agreement for the acquisition of Mountaineer Holding, LLC, a West Virginia company that holds a cultivation permit and two dispensary permits, resulting in a vertical platform.
  • Opened 11 new retail dispensaries in the fourth quarter, ending the year with 75 stores in the U.S. Added over 200,000 square feet of cultivation facilities during 2020, ending the year with almost 2 million square feet of cultivation facilities, to support this explosive growth of new stores.
  • Ended 2020 with a 49% market share in oil and 53% market share in flower in the state of Florida and achieved record flower and oil sales at the end of December, selling 93.7M mgs of oil and 36,330 ounces, or over one ton of flower.

Debra BorchardtNovember 17, 2020
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Florida-based Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) reported revenue of $136.3 million for the third-quarter ending September 30, 2020. This was a 13% sequential increase over the second quarter and topped the Yahoo Finance analyst estimate for revenue of $131 million. Trulieve also delivered a positive net income of $17.4 million, or $0.15 per diluted share, easily beating the Yahoo Finance analyst estimate of $0.22.

“Following an outstanding quarter, industry-leading profitability, and our recent entry into two additional states in the northeast, Trulieve has never been better positioned for the future.  Our third quarter was especially memorable because we introduced the long-awaited edibles product lines to our offerings and announced our acquisitions in Pennsylvania, where we see tremendous growth potential. Just last week the Pennsylvania acquisitions closed, and we were awarded a processor license in West Virginia. We also recently achieved our 2020 goal of opening 68 stores nationwide and expect our strong growth to continue,” stated Kim Rivers, Trulieve CEO.

The company also reported GAAP adjusted EBITDA of $65.8 million and has a solid cash position with cash and cash equivalents of $193.4 million as of September 30, 2020. Operating expenses rose by 15% to $37.9 million.

Year-to-date the company has reported roughly $352 million in revenue. Trulieve said during its last earnings release that it was forecasting 2020 revenue to be in the range of $465 million to $485 million. This puts the fourth quarter on target to deliver roughly $150 million in revenue and it would only have to report approximately $113 million to meet the low end of that estimated range. 

Expansion

While Trulieve is known for its large footprint in the state of Florida, the company has been on a push to expand into other states. The recent acquisitions of PurePenn LLC and Solevo Wellness, which closed on November 12, 2020, have helped the company plant its flag in Pennsylvania. It was also awarded a processor permit in West Virginia. Trulieve opened nine stores in the third quarter and recently achieved its 2020 goal of 68 stores nationwide.

“We want to thank the Office of Medical Cannabis for their comprehensive and thoughtful approach during this process, and we look forward to building a positive relationship with the state of West Virginia,” said Kim Rivers, CEO of Trulieve. “We are truly excited to be entering a sixth state. As a processor, we look forward to bringing our Trulieve brand to West Virginia through wholesale opportunities, partnering with other companies to bring their products to market in the state, and executing on our strategic vision to be the leading customer-focused cannabis brand in the United States, with depth in the markets we choose to operate in. Our plan is to be operational as soon as possible to provide access to the patients in West Virginia.”

The stock was lately trading at $26.95, near the top end of its year high of $27.79.

 


Debra BorchardtAugust 12, 2020
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Trulieve Cannabis Corp.  (CSE: TRUL) (OTCQX: TCNNF) reported revenue of $120.8 million, a 26% sequential increase for the second quarter ending June 30, 2020. It was an increase of 109% over last year’s second quarter and beat the average analyst’s estimates of $106 million according to Yahoo Finance.

Trulieve also reported a net income of $6.6 million for the second quarter, which was considerably lower than last year’s net income of $57.5 million for the same time period. Last year’s income from operations was $87 million versus this year’s $37 million. The fair value adjustment of $93 million for the 2020 second quarter was also much higher than last year’s adjustment of $21 million on the $57 million in revenues. 

The earnings per share were $0.06, which missed the analyst’s estimates of $0.16. There are five analysts covering the stock with an average price target of $23.47. The stock closed yesterday at $20.50.

“Once again our financial results reflect our exceptional ability to grow our business quarter over quarter, through continued organic expansion of our retail footprint, while maintaining industry-leading profitability. We are pleased to be able to demonstrate strong financial performance in revenue, adjusted EBITDA and free cash flow while pivoting our business to meet the changing behaviors and needs due to COVID,” stated Kim Rivers, Trulieve CEO. “Looking ahead, we are excited about the second half of the year and will continue focusing on execution and expansion.  We anticipate exceeding our goal of 68 stores and will continue our strong growth in Florida.  Massachusetts is getting closer to completion and we are excited to enter that market in 2021.  And, we believe the M&A pipeline and application processes underway will present new opportunities for expansion. Lastly, we are moving quickly down the path toward registering with the SEC and SOX compliances.”

Expenses did rise dramatically from last year’s $16 million to this year’s $36 million. Investors should be aware that for the six months ending June 30, 2020 and the year ended December 31, 2019, property and equipment
purchases from J.T. Burnette (CEO Kim River’s husband) consisted of construction-related services, totaled $35,942,463 and $46,381,877, respectively. the filing stated that “As of June 30, 2020, and December 31, 2019, $7,416,380 and $6,463,125 was included in accounts payable. The use of the Supplier was reviewed and approved by the independent
members of the Company’s board of directors, and all invoices are reviewed by the office of the Company’s general counsel.”

Big Cash Cushion

Trulieve is sitting comfortably on a big cash cushion. It has achieved a free cash flow of $39.6 million. The company also has cash and cash equivalents of $150.3 million as of June 30, 2020.

Raised Guidance

Trulieve has raised its full-year 2020 financial guidance. The company said it expects results to materially exceed previously issued revenue and adjusted EBITDA guidance ranges, driven principally by continued market share gains and operating leverage. The company is raising its guidance as follows:

In millions

Previous Guidance

Updated Guidance

Revenue

$380.0 – $400.0

$465.0 – $485.0

Adjusted EBITDA

$140.0 – $160.0

$205.0 – $225.0


Debra BorchardtApril 8, 2020
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Florida-based Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) delivered its financial results for the three and 12 months ending December 31, 2019. Revenue rose 13% and 146% respectively for those time periods and the company reaffirmed its guidance.

Trulieve is one of the few cannabis companies that is reporting net income versus its competitors who have mostly reported huge net losses. The stock was lately selling at $9.85, above its year’s low of $5.74 and below the 52-week high of $16.01. 

Fourth Quarter Results

Trulieve reported revenue of $79.7 million, which was an increase of 13% on a sequential quarter-to-quarter basis and a 122% increase over the same time period in 2018. Operating expenses increased by 30% sequentially to $23 million and 124% over the same time period in 2018. The company delivered a net income of $45 million for the quarter and noted that it has a 50% market share in the state of Florida.

“Our fourth-quarter results reflect our strong brand and customer loyalty, which were key factors in our success for the year. We continued to grow our footprint in Florida and made significant strides building out the infrastructure needed to maximize efficiencies and achieve economies of scale,” stated Kim Rivers, Trulieve CEO.

The company also stated that it opened seven additional dispensaries in Florida in the fourth quarter and now has 44 stores nationwide as of December 31, 2019. Trulieve also increased total current cultivation capacity to approximately 1.7 million square feet and has plans to continue indoor cultivation build-out at Jefferson County, FL location to match expected demand.

Full Year 2019

For the full-year 2019, Trulieve reported revenues of $252 million, a 146% increase over 2018’s revenue of $102 million. Net income for the year was $178 million. The company’s MD&A stated, “The (Florida) state registry
which approves and maintains the status of the medical cannabis license holders reached approximately
300,000 active patients during the fourth quarter of 2019. Trulieve’s statewide retail and home delivery
presence along with its broad product mix of over 300 SKUs were the main reasons for the continued
market growth.”

The company said it has cash and cash equivalents of $91 million at the end of 2019.

COVID

Rivers went on to say, “Despite recent developments surrounding COVID-19 and the uncertainty in the global economy, we see strong medical cannabis demand in our target markets and expect to continue maintaining our over 50% market share in Florida.  Our solid foundation and cash position enable us to monitor opportunities that meet our disciplined criteria and we remain optimistic about expansion in 2020.”

However, within the filing the company gave itself an out saying, “The ultimate extent of the impact of any epidemic, pandemic or other health crisis on the Corporation’s business, financial condition and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of such epidemic, pandemic or other health crisis and actions taken to contain or prevent their further spread, among others. These and other potential impacts of an epidemic, pandemic or other health crisis, such as COVID-19, could therefore materially and adversely affect the Corporation’s business,
financial condition and results of operations.”

 


StaffDecember 19, 2019
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Trulieve Cannabis Corp. (OTC: TCNNF) was being touted as the most promising of cannabis stocks. Its earnings reports put competitors to shame as the company delivered impressive net incomes and others instead struggled with net losses. This week a short-seller report has accused the company of being a fraud and that comes a week after the company faced fire over unwanted texts.

On Thursday, the company announced the appointment of two new advisors to the board of directors. Susan Thronson was a Senior Vice President of Global Marketing for Marriott International, leading Marriott’s worldwide integrated marketing strategy and execution for its 15 hotel brands. Ms. Thronson formerly served as a director of Angie’s List, an internet service company, and SONIC Drive-In, an operator of an American drive-in fast-food restaurant chain based in Oklahoma City, Oklahoma.

Thomas Millner served as CEO of Cabela’s, a direct marketer and specialty retailer of outdoor recreation merchandise, for nearly a decade.  Prior to Cabela’s, Mr. Milner spent 14 years as president and CEO of North Carolina’s Remington Arms Company, an American manufacturer of firearms and ammunition.

The stock tumbled on the news of the Grizzly Report but began to recover as others stepped up to defend the company. The stock fell from a close of $11.91 on Monday to $10.40 on Tuesday but was lately trading at $10.84.

Grizzly Research Report

The report called out the company for a variety of bad behaviors and questioned the earnings. The report said, “The company’s profitability is largely reliant on paper-gains, namely mark up on biological assets. Real cash flow has been in fact negative. We saw the company’s low-quality production, which makes us highly suspicious of the mark-ups that are far bigger than in for any other peer.”

It went on to say, “While almost all others are operating at a net loss during the examined horizon, Trulieve (using its
biological assets mark-ups), was able to consistently achieve positive net income with an astounding net
profit margin of as high as 99%. Upon closer inspection, we realize that at any given time, Trulieve holds an abnormally large amount of biological assets. Biological assets should typically be used to support revenue. However, we are seeing that Trulieve’s biological assets utilization efficiency is relatively low compared to peers. In other words, for every dollar in biological assets, Trulieve is able to generate the least amount of dollar sales. This
strongly suggests that the mark-up on these assets is overstated.”

The report did not shy away from its harsh words and allegations. It concluded, “CEO Kim Rivers and her husband JT Burnette are at the very center of a political crime ring the FBI has subpoenaed, and we have shown the multiple previously unknown connections between Trulieve and Burnette. We expect serious consequences for CEO Kim Rivers and Trulieve. They have been crooks then, and they are crooks now. We think Trulieve is absolutely uninvestible.”

Here’s a summary of the allegations:

  • Low quality cultivation facilities that could lead to poor products
  • Accusations that the CEO Kim River’s husband JT Burnette is involved in an FBI probe
  • Accusations that Burnette is Trulieve’s main construction partner
  • Alleges that Trulieve is not being truthful about its lenders and takes out small loans from insiders even as it suggests it has plenty of cash
  • Alleges that Trulieve is marking up the product to portray profitability

Trulieve Responds

While Trulieve, didn’t answer the accusations one-by-one it did release a response via a press release.  CEO Kim Rivers said, “We ask that our investors be aware that the Report reflects the opinions of an acknowledged short seller, whose sole interest is in profiting from a decline in the price of the Company’s shares. I have full confidence in our management team and their abilities to continue to serve our customers without being distracted by these baseless allegations. Trulieve reserves all of its rights to take appropriate legal action against those responsible for the Report.”

She went on to say, “Trulieve sells high quality flower, cultivated in our indoor facilities, and was recently recognized by an award from the Cannabis Business Association of having the best flower in Florida. We stand behind the quality of our products and have a long-standing no-questions-asked return policy.  Trulieve set a record for flower sales in Florida just last week, capturing over 51% of the market.”

Stifel Research

Stifel Director of Research Robert Fagen gave a fuller response to the Grizzly report. He addressed the FBI suggestion saying, “Kim Rivers’ involvement in the FBI investigation surrounding the activities of the Tallahassee CRA and its allocation of public funds has been well documented in TRUL’s disclosure since it went public.” The comment also noted that Trulieve paid for an independent review that determined the risk was not enough to keep Rivers from acting as CEO.

Fagen also noted that Burnette’s relationship as the main construction partner is not new information. “While we acknowledge the large amounts of equipment purchases by TRUL from an affiliated entity do not provide the best optics, we fail to see how this activity is technically illegal in light of public disclosures. It is rather a conflict of interest in our view.”

With regard to the accusation of poor quality products, Stifel reminded readers that the majority of the plants grown in the facility were intended for extraction purposes, which typically use a lower quality flower. He also pointed out that Trulieve has facilities for devoted to higher quality flower. “We would remind investors a major reason TRUL has maintained its disproportionately high market share is due to its high product quality, driving its strong repeat business.”

Finally, Fagen addressed the alleged paper-gains on the books by noting that an IFRS requirement forces the company to account for the product a certain way. “The concept that TRUL should be scrutinized for reporting gross margin in excess of revenue or large net income based on non-cash biological asset gains is rankly ridiculous in our view,” said Fagen.

Stifel did concede that Burnette’s relationship isn’t the company’s greatest attribute, but overall the Trulieve has been compliant in its disclosures. Stifel also pointed out that Trulieve’s competition is beginning to divert some of their capital away from the state as they tire of Truelives’s market share growth.

Unwanted Texts

It’s been a tough month for Trulieve. Mats Jaslow filed a class-action lawsuit last week claiming Trulieve is spamming its customers and followers with thousands of incessant texts. He claims the promotional tactic and its frequency violates the Telephone Consumer Protection Act, which aims to reduce the number of nuisance calls from businesses. Cannabis companies often turn to text messaging as a way to communicate with customers since many forms of advertising aren’t allowed.


Debra BorchardtNovember 19, 2019
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Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) released its financial results for the third quarter of 2019 ending September 30, 2019, with revenue of $70.7 million, an increase of 22% sequentially and an increase of 150% yearo-over-year. This beat analyst estimates by $5.09M.

The company also delivered a net income of $60.3 million for the quarter, which was higher than the second quarter’s net income of $57.5 million.

“Our third-quarter results reflect our continued customer loyalty, growth, and leadership position. Trulieve’s strong brand, wide-ranging access to stores, and authentic customer experience have resonated with our customers and patients,” stated Kim Rivers, Trulieve CEO. “The third quarter was also successful in further strengthening our position in our existing markets as well as preparing for new market entry. We continue to build operational efficiencies and financial discipline to ensure a solid foundation, cash reserves, and the right tools at our disposal to expand our footprint. Looking ahead, this is an exciting time as we execute on our strategic vision to be one of the top-performing cannabis companies in North America.”

Adjusted EBITDA increased from $31.6 million in Q2 2019 to $36.9 million at September 30, 2019.

The company also stated that gross profits after net gains on biological asset transformation for the quarter was $110.1 million, up $74.3 million or 208%, from $35.8 million for 2018 for the same time period. “This increase was driven by an increased gain on biological assets and increased retail sales. Additionally, because the corporation was growing more plants as of September 30, 2019 than it was as of September 30, 2018, there are more plants undergoing transformation and therefore more gain.”

Expenses Increase As More Locations Open

Total expenses for the three months ended September 30, 2019, was $20.6 million, an increase of $12.3 million or
147%, from $8.3 million for the three months ended September 30, 2018, which is mainly due to scaling of
the business.

Trulieve said the increase in total expenses was due to an increase of retail, sales and marketing expenses
which for the quarter which was $14.7 million, up to $8.2 million or 125%, from $6.5 million for 2018. Retail, sales and marketing expenses as a percentage of revenue were 21% for the quarter, as compared to 23% for the quarter 2018. “The overall increase in retail, sales and marketing expenses was due to the opening of additional dispensary locations and the associated costs including payroll and insurance.”

The stock was lately trading at $11.30, above its 52-week low of $6.68, but below its year high of $16.23.

 


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Happy Friday! Here’s the week’s top news all bundled up in one quick Marijuana Money: December 2, 2021

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