Vireo Health International, Inc. (CSE: VREO)(OTCQX: VREOF) reported financial results for its first quarter ended March 31, 2021 . Total revenue increased 8.8% to $13.2 million over last year’s $12.1 million and includes the former subsidiaries in Pennsylvania. This beat analyst estimates from Yahoo Finance for revenue of $12.4 million. Vireo trimmed its net losses slightly to $7.0 million versus a net loss of $7.5 million in the 2020 first quarter. The company said that the improvement in net loss was primarily the result of the gain on the divestiture of its former affiliate, Ohio Medical Solutions, Inc.
“Our first-quarter results are consistent with the trends from last quarter. We continued to see double-digit sequential revenue growth excluding our former Pennsylvania subsidiaries, and substantial improvement in our gross margin due to our focus on operational efficiencies,” said Chairman and Chief Executive Officer, Kyle Kingsley , M.D. “Wholesale performance in Maryland was temporarily impacted by the move to our recently-completed 110,000 square foot cultivation facility in Massey , but our increased scale in this market will drive stronger revenue growth and profitability in the second half of the year.”
Vireo said that excluding contributions from Pennsylvania, revenue would have increased 29.8%. Retail revenue excluding Pennsylvania increased 33.7% to $10.4 million in the firat quarter and reflected growth in each of its retail markets. Wholesale revenue, excluding Pennsylvania increased by 17.4% to $2.8 million, driven by strong growth in the Arizona market.
Dr. Kingsley continued, “The phase two expansion projects we discussed last quarter in Arizona and Maryland are underway, and our teams are now aggressively focused on finalizing our expansion plans in New York . The recent passage of adult-use legislation in New York and New Mexico has improved our outlook for both of these markets, and further potential for regulatory change at local and federal levels could meaningfully impact the trajectory of our performance. We are excited by all the growth opportunity we see across our core markets, and look forward to sharing more details on our long-term outlook at our upcoming Investor Day events which we plan to announce in the coming weeks.”
After The Quarter Ended
On April 14 , the company finished its planned expansion of its cultivation and processing facility in New Mexico, which is now operating following the receipt of regulatory approval. The company also announced that two recently completed retail dispensaries in Albuquerque and Las Cruces are ready to open, pending regulatory approval. Once approved, Vireo will have four operating dispensaries in the state of New Mexico .
On April 29 , launched medical cannabis flower in the state of New York . The ground flower line is being sold in 3.5-gram and 7-gram jars and will be expanded to feature indica, sativa, and hybrid strains such as Killer Kush, Wedding Cake, and a Kosher-approved Tangie Kush. The new line of ground flower will be available at all four of the Company’s dispensaries in New York and via Home Delivery.