Verano Beats On Earnings, Misses On Revenue Estimates

Verano Holdings Corp. (CSE: VRNO) (OTCQX: VRNOF) announced its results for the third quarter ended September 30, 2021, with revenues of $207 million, which increased over the second quarter’s revenue of $199 million. Unfortunately, this missed the average analyst estimates by Yahoo Finance for revenue of $299 million. Still, this was almost double over last year’s $101 million for the same time period. The revenues are calculated on a pro forma, consolidated basis accounting for the AltMed acquisition as if completed on January 1, 2021. The average estimate for earnings was $0.24, which Verano easily beat by reporting earnings of $0.33 per share.

Verano’s net income, including the impact of biological assets, was $103.7 million. The company said that excluding the impact of biological assets, net income was $15 million in the third quarter of 2021 versus $32 million reported in the second quarter of 2021. Cash flow from operations was $68 million and free cash flow was $35 million. The third quarter adjusted EBITDA was $111 million or 54% of revenue compared to $81 million or 41% of revenues in the prior quarter. Third quarter EBITDA on an unadjusted basis was $107 million or 52% of revenues.

“Our third-quarter results demonstrated the company’s fundamental strengths, highlighted by our industry-leading bottom-line performance that included $111 million in adjusted EBITDA, or 54% of revenue, and 33% sequential growth in gross profit,” said George Archos, Verano CEO and Founder. “We’ve expanded the Verano platform considerably, adding vertically integrated operations in Connecticut ahead of the adult-use transition and adding depth in Pennsylvania, Nevada, and Florida. We believe that we’re positioning the Company well for long-term topline growth while targeting a low-40s EBITDA margin profile heading into 2022 and beyond.”

Since the quarter ended, Verano secured additional, non-dilutive liquidity to support further inorganic growth, upsizing its credit facility by $120 million while lowering its cost of capital. The restated credit agreement also provides the option for an additional $100 million term loan at the same non-dilutive rate. In November, Verano announced three accretive acquisitions in Connecticut, including two active dispensaries and one 217,000 square foot cultivation and a production facility. The company is comfortable with its current assets on a consolidated basis at $629 million, including cash and cash equivalents of $57 million.

As of the date of this earnings report, Verano has 89 operating dispensaries and 12 cultivation and production facilities.

Debra Borchardt

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


Leave a Reply

Your email address will not be published. Required fields are marked *

Choose Your News

Subscribe to the Green Market Report newsletter that gives you original content delivered straight to your inbox.

 Subscribe

We respect your privacy. See our privacy policy.


About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

@GreenMarketRpt – 1 hour

Cannabis Banking Bill Passage After Election Season Is ‘Likely’, Analyst Says

@GreenMarketRpt – 7 hours

SEC Charges Eight in Cannabis Stock Promotion Scheme

Back to Top

Choose Your News

Subscribe to the Green Market Report newsletter that gives you original content delivered straight to your inbox.

 Subscribe

We respect your privacy. See our privacy policy.