Tilray Brands, Inc.’s (Nasdaq: TLRY; TSX: TLRY) acquisition of Hexo has bolstered ted the company’s market position during the quarter.
On Thursday, the company reported its financial results for the fourth quarter and fiscal year ended May 31. The company has grown significantly across all its segments, including cannabis, beverage alcohol, and distribution.
In the fourth quarter, Tilray’s net revenue increased by 20 per cent to $184 million, compared to $153 million in the prior year quarter. This growth in revenue can be attributed to several factors.
The company’s acquisition of HEXO substantially grew its cannabis market share in Canada to 13 per cent and also expanded its medical cannabis market position across Europe.
Each of Tilray’s reporting segments for cannabis, beverage alcohol, and distribution individually grew revenue by approximately $10 million in the fourth quarter, a growth of around 20 per cent compared to the prior year quarter.
The distribution gross margin rose 9 per cent in the quarter from -7 per cent in the prior year, reflecting a favourable product mix.
The company is working towards a seamless integration into its efficient platforms to drive both revenue and cost synergies while expanding product distribution in Canada and across international markets.
Despite ongoing challenges to cannabis market conditions in Canada, Tilray maintained its #1 cannabis market share position in FY 2023. The addition of HEXO’s high-growth brands to the Tilray portfolio significantly bolsters the company’s position supported by low-cost operations and complimentary distribution across all Canadian geographies.
Beer brands making strides
The company made substantial strides across its five craft-beverage brands including leaders SweetWater Brewing Company, Breckenridge Distillery and Montauk Brewing Company, growing revenue in its beverage alcohol segment by 33 per cent and adjusted gross profit by 24 per cent.
Tilray’s gross profit was $67 million, while adjusted gross profit was $68 million in the quarter. Gross margin was 36 per cent, while adjusted gross margin rose to 37 per cent from 33 per cent in the prior year quarter.
The company reported a net loss of $120 million in the fourth quarter compared to a net loss of $458 million in the prior year quarter. Adjusted net loss was $32 million in the fourth quarter compared to an adjusted net loss of $46 million in the prior year quarter.
Adjusted EBITDA rose 93 per cent to $22 million in the fourth quarter from $12 million in the prior year quarter. Operating cash flow was $44 million in the fourth quarter compared to -$21 million in the prior year quarter.
The company’s recent acquisition of HEXO has significantly bolstered its competitive positioning in Canada and across international markets, contributing to its revenue growth and operating efficiencies.
“The recent closing of the HEXO transaction has boosted our competitive positioning in Canada, the largest, federally legalized cannabis market in the world,” CEO Irwin D. Simon said.
“We are working towards a seamless integration into our efficient, built-to-last platforms as we leverage our deep CPG expertise and track record to drive both revenue and cost synergies while expanding product distribution in Canada and across international markets,” Simon added.
Tilray stock went up by 10.8 per cent to $2.83 on the Toronto Stock Exchange.