Verano Delivers Solid Earnings As Expansion Efforts Heat Up

Verano Holdings Corp.  (OTCQX: VRNOF) announced its financial results for the first quarter ended March 31, 2021. Verano noted that its revenue was reported on a pro forma basis as if the AltMed acquisition were completed on January 1, 2021. With that in mind, the first quarter of 2021 revenues increased 117% from the first quarter of 2020 to $143 million. Unfortunately, this missed the Yahoo Finance average analyst estimate for revenues of $160 million.

Net income in the quarter, including the impact of biological assets, was $126 million versus $72 million in the first quarter of 2020. Excluding the impact of biological assets, net income was $8 million in the first quarter of 2021. The earnings per share were net income per share – basic were $ 0.48 and net income per share – diluted was $ 0.27, easily beating the average estimate for $0.12 per share.

“Our strong first-quarter performance was foundational in nature and sets the tone for what we expect to be a transformational year. We anticipate considerable quarter-over-quarter growth in 2021 as we begin to realize the impact of accretive acquisitions we’ve made over the last few months, in addition to broad expansion of cultivation capacity and organic retail growth,” said George Archos, Verano CEO and Founder. “We’ve expanded our retail footprint and production capacity in core markets where we’ve identified substantial near- and long-term upside.”

Verano’s first quarter 2021 EBITDA on an unadjusted basis was $60 million or 42% of revenues, and Adjusted EBITDA was $75 million or 52% of revenues. As of March 31, 2021, the company’s current assets on a pro forma consolidated basis were $549 million, including cash and cash equivalents of $112 million.

Verano’s Expansion Efforts

Verano has completed the acquisitions of Territory, Emerald, and Local Joint, all in Arizona, giving it the third-largest retail footprint in the state with six active storefronts plus two cultivation facilities. In first quarter 2021, the company brought four new dispensaries online in as many states. In April, Verano opened its second of three planned Zen Leaf dispensaries in New Jersey, where the expansion of its 120,000 sq. ft. cultivation facility is underway in anticipation of the onset of adult use sales in the state.

In addition to that, the company completed acquisitions of TerraVida and The Healing Center, adding six dispensaries in Pennsylvania – three in the Philadelphia metroplex and three in the Pittsburgh metroplex – and also acquired a permit for the development of three additional dispensaries in the state. Verano also announced it has entered into agreements for the acquisitions of Agri-Kind and Agronomed Biologics in Pennsylvania, which are expected to add an active and completely built-out, state-of-the-art 62,000 sq. ft. indoor grow facility, in addition to further developing the Company’s vertically integrated footprint with a permit for six new dispensaries and a second cultivation and production facility.

Money For Growth

Last week, Verano filed for an offering to raise C$1.2 billion during a 25 month period. Verano said at the time that it expects to file a supplement to qualify the issuance of Class A subordinate voting shares upon the exercise of special warrants previously issued on a private placement basis which raised gross proceeds of approximately C$100 million.

“The filing of a base shelf prospectus supports our growth strategy by providing us with the flexibility to access capital as future opportunities arise,” said Archos. “We’ve been assertive in the M&A arena, demonstrating strong capital stewardship through several accretive transactions. Collectively, these acquisitions have expanded our footprint considerably, adding depth in Illinois and Pennsylvania while unlocking high-growth markets in both Florida and Arizona. We anticipate that we will continue to deliver added shareholder value through strategic capital allocation in the months and years ahead.”


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 *

Get the latest cannabis news delivered right to your inbox

The Morning Rise

Unpack the industry with the daily cannabis newsletter for business leaders.

 Sign up

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


Recent Tweets

Back to Top

Get the latest cannabis news delivered right to your inbox

The Morning Rise

Unpack the industry with the daily cannabis newsletter for business leaders.