One of America’s largest pot companies, Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF), is posting record annual sales but turned less of a profit due to heavy spending.
On Wednesday, the Florida-headquartered firm released its earnings results for the fourth quarter and fiscal 2021 ended Dec. 31, with annual revenue up 80 per cent to US$938.4 million from US$521.5 million last year.
Gross profit for the year rose 60 per cent to US$566.1 million from US$386.4 million in 2020. But gross profit margin fell to 66 per cent from 75 per cent, which the company said was due to a “strategic diversification into new lower margin markets and channels.”
Net income dropped 70 per cent to US$18 million from US$63 million, which Trulieve attributed to one-time costs related to its US$2.1-billion acquisition of rival Harvest Health.
Adjusted earnings before interest, taxes, depreciation and amortization was US$384.6 million, up 48 per cent from US$260.1 million.
At the end of the year, the company had US$234 million in cash.
During the fourth quarter, sales rose sequentially by 36 per cent to US$305.3 million from US$224.1 million in the third quarter.
But gross profit margin fell to 43 per cent from 69 per cent.
Read more: Trulieve acquires Harvest, becomes largest cannabis operator in US
Read more: Trulieve adds another US$75M to massive debt facility
Quarterly net loss sank to negative US$71.5 million from income of US$18.6 million. And adjusted EBITDA inched up 3 per cent to US$100.9 million.
CEO Kim Rivers says 2021 was a phenomenal year for her company.
“Our team built upon our established track record of success, further expanding our distribution network through our hub strategy while setting the stage for continued growth,” she says in a statement.
“In 2022 we expect to deliver improved performance as our efforts to optimize assets and teams across our platform provide meaningful contributions to our results.”
Trulieve is giving 2022 revenue guidance of US$1.3 billion or higher, and adjusted EBITDA of at least US$450 million. Earlier this month, rival Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) reported annual 2021 revenue of US$1.2 billion.
In the fourth quarter, Trulieve added 58 dispensaries, including 49 acquired through Harvest and Purplemed. It also released its first environmental, social and governance report.
Company stock rose slightly on the news to $26.05 on the Canadian Securities Exchange.
Read more: Curaleaf posts record US$1.2B in sales for fiscal 2021