AWH Announces
Fourth Quarter and Full Year 2025 Results
Delivered
Q4 2025 and FY 2025 revenue of $120.5 million and $500.6 million
Expanded
Adjusted EBITDA Margin1 to 25.1% in Q4 2025 and 23.4% for
FY 2025
Maintained
strong liquidity with $85.7 million in cash and no
significant near-term debt
Retail
footprint reaches 48 locations as densification continues
NEW YORK, March 12, 2026
- Ascend
Wellness Holdings, Inc. (“AWH,”
“Ascend,” or the “Company”) (CSE: AAWH-U.CN) (OTCQX: AAWH), a multi-state,
vertically integrated cannabis operator, today reported its financial results
for the quarter and year ended December
31, 2025. Financial results are reported in accordance with U.S. generally accepted accounting principles (“GAAP”), and
all currency is in U.S. dollars.
Q4 & FY 2025 Business Highlights
·
Executed densification
strategy throughout 2025 with eight new dispensary openings, broadening market presence and
expanding retail footprint to 48 locations to date, including partner owned and
operated locations.
o Ascend opened its first social equity
partner store in Little Falls, New Jersey, with Mister Jones, LLC in Q4 2025. The
Company has also secured approval from the New Jersey Cannabis Regulatory
Commission for a second social equity partner store, which will be located in Eatontown, New Jersey and is expected to
begin operations in April 2026.
o In the first quarter of 2026 (“Q1
2026”), AWH opened its sixth Ohio store and an additional partner owned and operated
location in Illinois. Additionally, the Company closed an underperforming store
in Ann Arbor, Michigan.
o
The retail development pipeline includes 12 new locations,
which would bring the Company’s total owned and partner
owned and operated dispensaries to 60, pending regulatory approvals.
· Developed and launched a record 566
SKUs in FY 2025, including 146 in Q4 2025, surpassing an initial goal of 550
SKUs for the year, including:
o Debut of two new
brands: High Wired infused flower and Honor
Roll top quality pre-rolls made with 100% flower.
o Expansion of formats, flavors, and formulations
across nearly all product lines, including Effin’ effects-based gummies and vapes, High Wired sugar caps,
and Simply Herb disposable vapes, with many newly launched products ranking
among AWH’s top-selling SKUs for Q4 2025.
o Launch of Ozone Liquid Diamonds vape
and the ultra-limited Ozone King of Queen Cola.
o Following the
quarter, in Q1 2026, AWH unveiled a full-scale brand and quality transformation
of its flagship lifestyle brand Ozone, featuring a refreshed visual identity,
elevated product standards, innovative packaging, and enhanced consumer
engagement. The relaunch has begun in Illinois, Massachusetts, and New Jersey, with
other key markets to follow in the coming quarters. A variety of new products
will launch in tandem with Ozone’s evolution, including the brand’s first full-spectrum
gummies, as well as new macro-dose gummies and additional flower and vape
offerings.
- Maintained position among the
top three brand houses by both sales and units across Illinois,
Massachusetts, and New Jersey3 combined throughout FY 2025, reinforcing
market leadership with an expanded suite of products and brands.
· Delivered a fully integrated
e-commerce ecosystem, combining a redesigned shopping platform and app with
AI-driven personalization, Ascend Pay pay-by-bank functionality, and an
enhanced loyalty program, marking a key milestone in AWH’s customer-first
strategy.
o Sales through Ascend
Pay increased by 49.4% from the third quarter of 2025 (“Q3 2025”) to Q4 2025,
driven by a 51.5% increase in transactions and a 57.8% rise in units sold
through the pay-by-bank functionality across Ascend and partner owned and
operated retail locations.
o In Q4 2025, Ascenders Club loyalty
program total membership grew by 56% with active members
increasing by 23.7% sequentially. Loyalty members accounted for 88% of retail
transactions, which were up 16% for Ascend retail locations.
· Strengthened capital structure by
fully repaying the Company’s $60.0 million term loan through a $50.0 million
private placement of 12.75% Senior Secured Notes4 due 2029 and $10.0
million of cash on hand, completing its broader refinancing initiative in Q2
2025. AWH also secured $9.3 million in financing on three Ohio properties at a
competitive 8.5% interest rate maturing in September 2030, to support
disciplined growth and retail expansion.
· Successfully completed the normal
course issuer bid (“NCIB”) share buyback program (the “Buyback Program”).
o The Company repurchased and retired approximately
15.8 million shares at an average price of $0.32 per share5 since
the fourth quarter of 2024, when the Buyback Program was initiated.
Financial Highlights
Q4 2025:
·
Total net revenue was $120.5 million compared to $124.7 million in the third quarter of
2025 (“Q3 2025”).
o Retail revenue was $85.0 million
compared to $83.8 million in Q3 2025.
o Wholesale revenue was $35.5 million
compared to $41.0 million in Q3 2025.
· Net loss of $48.7 million, which includes a $17.0
million arbitration settlement expense (as detailed below), compared to
$25.8 million in Q3 2025.
·
Adjusted EBITDA1 was $30.2 million compared to $31.1
million in Q3 2025, representing Adjusted EBITDA Margin1 of 25.1%, a sequential increase of 20-basis
points.
FY 2025:
·
Total net revenue was $500.6 million compared to $561.6 million in full year 2024 (“FY 2024”).
o Retail revenue was $339.6 million
compared to $372.2 million in FY 2024.
o Wholesale revenue was $161.0 million
compared to $189.4 million in FY 2024.
·
Net loss of $118.2 million compared to $85.0 million in FY 2024.
·
Adjusted EBITDA1 was $116.9 million compared to $116.2
million in FY 2024, representing Adjusted EBITDA Margin1 of 23.4%.
·
Cash and cash equivalents of $85.7 million as of December 31, 2025.
Management Commentary
“2025 was a pivotal year for our
business, marked by strong progress across our strategic pillars of
densification, profitability, and sustainability,” said Sam Brill, Chief
Executive Officer & Director of AWH. “Our retail footprint expanded with eight
new locations, bringing the total to 48 to date and keeping us on track for our
60-store target by the end of 2026. Through disciplined execution, we exceeded
our $30 million annualized cost savings target and strengthened our capital
structure through a strategic refinancing that extends our debt obligations to 2029.
Improvements in Adjusted EBITDA margin reflect our
continued focus on optimizing product mix while maintaining prudent cost
management. Enhancements to product quality have enabled us to compete
effectively at compelling price points in a dynamic market, driving
profitability across our finished goods portfolio. This momentum will fuel our
2026 priorities, focused on advancing retail densification, enhancing our
retail model, and elevating our CPG platform to drive revenue per gram and
high-margin sales through disciplined pricing, expanded distribution, and brand
strength.”
“Our focus on CPG innovation drove meaningful
portfolio expansion in 2025, including the launch of two new category-leading
brands and a record number of SKUs,” said Frank Perullo, Founder, President
& Director of AWH. “High Wired quickly emerged as a top performer in the
infused flower category, ranking second in total sales and units in New Jersey,
and third overall in sales and units across Illinois, Massachusetts, and New
Jersey combined as of the end of Q4 2025. We optimized cultivation and
manufacturing, invested in automation, and achieved record yields and potency
levels to elevate quality and ensure the products reaching our customers are
among the best we have ever produced. The implementation of our e-commerce
platform and refreshed loyalty program has further enhanced customer
engagement, accelerated product discovery, and improved retention. Together,
these initiatives not only support competitive growth but establish a scalable
platform to deliver high-quality products in markets where customers are ready
to meet us.”
“In 2025, we strengthened our
financial flexibility and expanded liquidity to support long-term growth,” said
Roman Nemchenko, Chief Financial Officer of AWH. “By extending our debt profile
and securing mortgage arrangements in Ohio, we established a stable capital
foundation for disciplined expansion. With this platform in place, we are well
positioned to continue improving our margin profile and driving profitability
across the business. We entered 2026 with a robust balance sheet, a strong cash
balance of $85.7 million, and a clear strategy to scale thoughtfully, pursue
selective strategic M&A, and drive sustained value for our customers and
shareholders.”
Q4 2025 Financial Overview
Net revenue totaled $120.5 million for Q4 2025, representing a 3.4% sequential decline.
Retail revenue was $85.0 million, an increase of 1.4% sequentially. The increase was driven by the ongoing ramp-up of new stores and increased in-house production of higher-margin finished goods, resulting in retail sales accounting for approximately 70.5% of total net revenue. This growth was constrained by continued pricing pressures and increased competition in various markets, as higher unit volumes were offset by lower average selling prices, affecting same-store sales in most markets.
Third-party wholesale revenue was
$35.5 million, a 13.1% decrease from the prior quarter. The decline reflects
the increased focus on routing biomass toward higher-margin finished goods for
retail sales, alongside the ongoing impact of pricing pressures in Illinois and
New Jersey.
Q4 2025
gross profit was $45.1 million,
or 37.4% of revenue, as
compared to $43.6 million,
or 35.0% of revenue, in Q3
2025. Adjusted Gross Profit1 was $54.7 million, or 45.4% of revenue, for Q4 2025, as compared to $57.8 million, or 46.4% of revenue, for the prior
quarter. The decline in Adjusted Gross Profit1 was primarily driven
by overall lower sales and a 100-basis point sequential decrease in Adjusted
Gross Margin1. Adjusted Gross Margin1 was impacted
by market-wide seasonal discounting, which countered the improvements of
increased verticality and improved third-party product margins.
Total general and administrative (“G&A”) expenses for Q4 2025 were $45.3 million, or 37.6% of revenue, compared to $44.9 million, or 36.0% of revenue, for the prior quarter, reflecting costs related to new store expansions as the Company advances its densification strategy, and partially mitigated by ongoing cost discipline.
Net loss for Q4 2025 was $48.7 million, compared to $25.8 million in Q3 2025. The
change was primarily driven by higher G&A expenses, partially offset by ongoing
cost-control and efficiency efforts, as well as margin
profile expansion.
Adjusted EBITDA1 was $30.2 million in Q4 2025 compared to $31.1 million in Q3 2025, with an
Adjusted EBITDA Margin1 of 25.1%, a 20-basis point increase from the prior quarter. The
decrease reflects pricing pressures across several markets and a modest
increase in G&A expenses, while the margin expansion demonstrates the
benefits of the Company’s shift toward a more favorable product mix.
FY 2025 Financial Overview
Net revenue totaled $500.6 million for FY 2025, representing a 10.9% year-over-year decline.
Retail revenue was $339.6 million, an 8.8% decrease year-over-year, primarily due to ongoing pricing headwinds and reduced transaction volumes in several markets. The decrease was partially offset by the ongoing ramp-up of eight new stores opened during FY 2025.
Third-party wholesale revenue was
$161.0 million, a 15.0% decrease from the prior year, primarily resulting from continued
price compression across various markets and the aforementioned shift away from
wholesale bulk sales in the second half of the year, partially mitigated by an
increase in sales of larger format finished goods to close out the year.
FY 2025 gross profit was $169.7
million, or 33.9% of revenue, as compared to $184.2 million, or 32.8% of
revenue, in FY 2024. Adjusted Gross Profit1 was $220.0 million, or 43.9%
of revenue, as compared to $225.9 million, or 40.2% of revenue, in FY 2024. The
decrease reflects market-driven price softness, partially offset by a higher
vertical sales mix and improved margins on third-party products. Adjusted Gross
Margin1 benefitted from reduced exposure
to promotional cycles and disciplined pricing.
Total G&A expenses for FY 2025 were $169.7 million, or 33.9% of revenue, compared to $179.5 million, or 32.0% of revenue, for FY 2024. This reduction was driven by ongoing cost controls, partially offset by the continued execution of the Company’s retail expansion initiatives.
Net loss for FY 2025 was $118.2 million, compared to $85.0 million for FY 2024. The current year
was impacted by higher interest expense but
benefitted from margin profile improvements and continued cost-saving and
operational efficiency initiatives.
Adjusted EBITDA1 was $116.9 million in FY 2025, compared to $116.2 million in FY 2024, with an Adjusted
EBITDA Margin1 of 23.4%.
The improvement was largely attributed to a
reduction in G&A expenses and a shift toward a higher-margin finished goods product mix, partially impacted by ongoing
price compression.
Balance Sheet
Cash and cash equivalents as of December 31, 2025, were $85.7 million and Net Debt6
was $215.8 million. Net
cash flows from operating activities were $16.3 million during Q4 2025.
The Company invested a total of $26.0 million
in capital expenditures during FY 2025, allocated to retail network expansion,
facility upgrades and improvements, and automation projects across its footprint.
As of Q4
2025, the Company reserved $17.0 million related to the settlement of an
arbitration matter. Additional information regarding the matter is available in
the Company’s Form 8-K filed on February 13, 2026. The matter has been fully
resolved in Q1 2026.
Outlook
Looking ahead to Q1 2026, the
Company expects a low to mid-single digit decline in topline revenue,
reflecting post-holiday consumer softness, ongoing pricing headwinds, and
weather-related closures across several markets during the early part of the
quarter. Despite these pressures, Adjusted EBITDA Margin 1 is
expected to remain in the low-20% range. The Company is cautiously optimistic
that the impact of continued price compression is anticipated to be partially
offset by the commercialization of higher-margin SKUs, new store openings, and
continued increases in direct-to-consumer vertical sales.
1
Measure is a non-GAAP financial measure.
Please see “Non-GAAP Financial Information and Definitions” below and
“Reconciliations of Non-GAAP Financial Measures (Unaudited)” at the end of this
press release.
2
Includes both Company-owned and retail partner
locations.
3
Source: BDSA
4
The Notes form part of the same series of
the $250 million aggregate principal amount of the Company's 12.75%
senior secured notes due 2029, of which $235 million aggregate
principal amount was issued on July 16, 2024 and $15
million aggregate principal amount was issued on January 13, 2025.
The Notes were issued at a price of 97.5% of face value pursuant to and
governed by a trust indenture entered into as
of July 16, 2024, as amended and supplemented by a first supplemental
indenture dated as of January 13, 2025.
5
Under the Buyback Program, the Company was
eligible to repurchase up to the lesser of: (i)
10,215,690 shares of the Company’s Class A common stock (“Common Shares”); and
(ii) $2.25 million worth of Common Shares, in the open market. Total shares
repurchased includes 11 million shares repurchased
in a private transaction in Q4 2024.
6
Net Debt is a non-GAAP financial measure
defined as total debt, net of unamortized deferred financing costs of ~$301.5 million,
less cash and cash equivalents of $85.7 million as of December 31, 2025. Please
see “Non-GAAP Financial Information” below.
Earnings Conference Call
The Company will hold a conference call today, Thursday, March 12,
2026, at 5:00 PM ET, to discuss
its fourth quarter and full year 2025 results.
The call can
be accessed by dialing 1-888-699-1199, and a live audio webcast will be
available at this
link. The webcast will also be archived for replay via the Investor
Relations section of the AWH website at https://awholdings.com/investors. A telephone replay will be available by calling 1-888-660-6345
with replay code 66620# until midnight ET on Thursday, March 19, 2026.
About Ascend Wellness Holdings, Inc.
AWH is a vertically integrated cannabis operator with assets in
Illinois, Maryland, Massachusetts, Michigan, New Jersey, Ohio, and
Pennsylvania. AWH owns and operates state-of-the-art cultivation facilities,
growing award-winning strains and producing a curated selection of products for
retail and wholesale customers. AWH produces and distributes its in-house Ozone,
Simply Herb, High Wired, Honor Roll, Royale, and Effin’
branded products. For more information about AWH, visit www.awholdings.com.
Non-GAAP Financial Information and
Definitions
This press release includes
certain non-GAAP financial measures as defined by the U.S. Securities and Exchange Commission (“SEC”).
Reconciliations of these non-GAAP financial measures to the most directly
comparable financial measure calculated and presented in accordance with GAAP
are included in the financial schedules attached to this press release or in
other information contained herein. This information should be considered as supplemental in nature and not as a
substitute for, or superior to, any measure of performance prepared in
accordance with GAAP.
Adjusted EBITDA/Margin and Adjusted Gross Profit/Margin are non-GAAP financial measures. Please see “Reconciliations of Non-GAAP Financial Measures (Unaudited)” at the end of this release.
We define Net Debt as total debt, net of unamortized deferred financing costs, less cash and cash equivalents, which components are disclosed in the Company’s Selected Condensed Consolidated Balance Sheet Information (Unaudited) included in the financial schedules attached to this press release under the captions “Current portion of debt, net,” “Long-term debt, net,”, and “Cash and cash equivalents.” We believe this measure is an important indicator of the Company’s ability to service its long-term debt obligations. This non-GAAP financial measure should not be considered in isolation of, or as a substitute for, the most directly comparable GAAP financial measures as an indicator of operating performance or liquidity and may not be comparable to similarly titled measures provided by other companies.
Cautionary
Note Regarding Forward-Looking Information
This news release contains
forward-looking information and forward-looking statements (collectively,
“forward-looking statements”) within the meaning of applicable U.S. and
Canadian securities laws, which may include, but are not limited to, the plans,
intentions, expectations, estimates, and beliefs of the Company. Words such as
“expects”, “continue(s)”,
“may”, “will”,
“anticipates”, and “intends” or similar expressions
are intended to identify forward-looking statements. Without limiting the
generality of the preceding statement, all statements in this press release
relating to estimated and projected revenue, expectations regarding production
capacity, anticipated capital expenditures, expansion, profit, product demand,
margins, costs, cash flows, sources of capital, growth rates, potential
acquisitions, closing dates for transactions, regulatory approvals, future
facility openings, and future financial and operating results are
forward-looking statements.
We caution investors that any such forward-looking statements are based on the Company’s current projections and expectations about future events and financial trends, the receipt of all required regulatory approvals, and on certain assumptions, estimates and analysis made by the Company in light of the experience of the Company and its perception of historical trends, current conditions, and expected future developments and other factors that management believes are appropriate.
Forward-looking statements involve
and are subject to assumptions and known and unknown risks, uncertainties, and
other factors which may cause actual events, results, performance, or
achievements of the Company to be materially different from future events,
results, performance, and achievements expressed or implied by forward-looking
statements herein. Such factors include, without limitation, the risks and
uncertainties identified in the Company’s most recently filed Annual Report on
Form 10-K, as updated in subsequently filed Quarterly Reports on Form 10-Q, as
applicable, and in the Company’s other reports and filings with the applicable
Canadian securities administrators on its profile on SEDAR+ at www.sedarplus.ca
and the SEC on its profile on EDGAR at www.sec.gov. Readers are cautioned that the foregoing list
of factors is not exhaustive. Although the Company believes that any
forward-looking statements herein are reasonable, in light of the use of
assumptions and the significant risks and uncertainties inherent in such
statements, there can be no assurance that any such forward-looking statements
will prove to be accurate, and accordingly readers are advised to rely on their
own evaluation of such risks and uncertainties and should not place undue
reliance upon such forward-looking statements. Any forward-looking statements
herein are made as of the date hereof, and except as required by applicable
laws, the Company assumes no obligation and disclaims any intention to update
or revise any forward-looking statements herein or to update the reasons that
actual events or results could or do differ from those projected in any
forward-looking statements herein, whether as a result of new information,
future events or results, or otherwise, except as required by applicable laws.
No securities regulator nor the Canadian Securities Exchange has reviewed,
approved, or disapproved the content of this press release.
Preliminary Financial Metrics
This press release contains certain
preliminary financial metrics for the fourth quarter and full year 2025. Financial
metrics contained in this press release are preliminary and represent the most
current information available to the Company’s management, as financial closing
procedures for the three months and year ended December 31, 2025 are not yet complete. The Company’s actual
consolidated audited financial statements for such period will be filed with
the SEC on its profile on EDGAR at www.sec.gov
and with the applicable Canadian securities administrators
on its profile on SEDAR at https://www.sedarplus.ca/. The final results for such periods may
differ materially from the financial metrics summarized in this press release as a result of the completion of normal quarter-end
and year-end accounting procedures, audit adjustments, and other developments
that may arise prior to the filing of the Company’s consolidated financial
statements. Although
the Company believes the expectations reflected in this press release are based
upon reasonable assumptions, the Company can give no assurance that actual
results will not differ materially from these
expectations.
Company:
Frank Perullo
Founder, President & Director
Investor Relations & Media
Inquiries:
MATTIO Communications
AWH@mattio.com
IR@awholdings.com
|
|
Three Months Ended |
|
Year Ended |
||||
|
(in thousands, except per share amounts) |
2025 |
|
2024 |
|
2025 |
|
2024 |
|
Revenue, net |
$ 120,546 |
|
$ 136,006 |
|
$ 500,581 |
|
$ 561,599 |
|
Cost of goods sold |
(75,420) |
|
(89,135) |
|
(330,901) |
|
(377,389) |
|
Gross profit |
45,126 |
|
46,871 |
|
169,680 |
|
184,210 |
|
Operating expenses |
|
|
|
|
|
|
|
|
General
and administrative expenses |
45,297 |
|
40,773 |
|
169,692 |
|
179,476 |
|
Settlement
expense |
17,000 |
|
— |
|
17,000 |
|
— |
|
Total
operating expenses |
62,297 |
|
40,773 |
|
186,692 |
|
179,476 |
|
Operating (loss) profit |
(17,171) |
|
6,098 |
|
(17,012) |
|
4,734 |
|
|
|
|
|
|
|
|
|
|
Other (expense)
income |
|
|
|
|
|
|
|
|
Interest
expense |
(15,484) |
|
(11,709) |
|
(51,294) |
|
(45,263) |
|
Other
income (expense), net |
189 |
|
(391) |
|
1,491 |
|
707 |
|
Total
other expense |
(15,295) |
|
(12,100) |
|
(49,803) |
|
(44,556) |
|
Loss before income
taxes |
(32,466) |
|
(6,002) |
|
(66,815) |
|
(39,822) |
|
Income tax expense |
(16,237) |
|
(10,789) |
|
(51,378) |
|
(45,172) |
|
Net loss |
$ (48,703) |
|
$ (16,791) |
|
$ (118,193) |
|
$ (84,994) |
|
|
|
|
|
|
|
|
|
|
Net loss per share
attributable to Class A and Class B stockholders of Ascend Wellness Holdings,
Inc. — basic and diluted |
$ (0.24) |
|
$ (0.08) |
|
$ (0.58) |
|
$ (0.40) |
|
Weighted-average common shares outstanding — basic and
diluted |
202,071 |
|
213,329 |
|
203,477 |
|
212,433 |
|
|
Three Months Ended |
|
Year Ended |
||||
|
(in thousands) |
2025 |
|
2024 |
|
2025 |
|
2024 |
|
Net cash provided by operating activities |
$ 16,316 |
|
$ 35,166 |
|
$ 38,053 |
|
$ 73,292 |
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Additions to capital assets |
(6,894) |
|
(5,024) |
|
(26,009) |
|
(22,534) |
|
Investments in notes receivable |
(64) |
|
— |
|
(349) |
|
(600) |
|
Collection of notes receivable |
82 |
|
82 |
|
4,427 |
|
8,427 |
|
Proceeds from sale of assets |
— |
|
— |
|
27 |
|
11 |
|
Acquisition of businesses, net of cash acquired |
(2,437) |
|
— |
|
(11,882) |
|
(9,800) |
|
Purchases of intangible assets |
(7,450) |
|
(2,250) |
|
(11,950) |
|
(12,700) |
|
Net cash used in investing activities |
(16,763) |
|
(7,192) |
|
(45,736) |
|
(37,196) |
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Proceeds from issuance of debt |
— |
|
— |
|
72,412 |
|
217,413 |
|
Repayments of debt |
(26) |
|
— |
|
(61,988) |
|
(215,786) |
|
Debt issuance costs |
(25) |
|
(535) |
|
(487) |
|
(7,193) |
|
Repayments of finance leases |
(447) |
|
(526) |
|
(1,842) |
|
(892) |
|
Proceeds from exercise of stock options |
80 |
|
— |
|
140 |
|
175 |
|
Taxes withheld under equity-based compensation plans, net |
— |
|
(1,187) |
|
— |
|
(6,247) |
|
Repurchase of common stock and warrants |
(731) |
|
(2,751) |
|
(2,311) |
|
(2,751) |
|
Payment of contingent consideration |
— |
|
— |
|
(819) |
|
(4,842) |
|
Distributions to non-controlling interests |
— |
|
— |
|
— |
|
(227) |
|
Net cash (used in) provided by financing activities |
(1,149) |
|
(4,999) |
|
5,105 |
|
(20,350) |
|
Net (decrease) increase in cash, cash equivalents, and restricted cash |
(1,596) |
|
22,975 |
|
(2,578) |
|
15,746 |
|
Cash, cash equivalents, and restricted cash at beginning of period |
87,272 |
|
65,279 |
|
88,254 |
|
72,508 |
|
Cash, cash equivalents, and restricted cash at end of period |
$ 85,676 |
|
$ 88,254 |
|
$ 85,676 |
|
$ 88,254 |
|
|
December 31, |
||
|
(in thousands) |
2025 |
|
2024 |
|
Cash and cash
equivalents |
$ 85,676 |
|
$ 88,254 |
|
Inventory |
84,707 |
|
89,552 |
|
Other current assets |
38,566 |
|
51,570 |
|
Property and
equipment, net |
382,402 |
|
260,461 |
|
Operating lease
right-of-use assets |
47,063 |
|
139,067 |
|
Intangible assets,
net |
196,072 |
|
205,502 |
|
Goodwill |
58,453 |
|
49,599 |
|
Other non-current
assets |
14,990 |
|
16,426 |
|
Total Assets |
$ 907,929 |
|
$ 900,431 |
|
|
|
|
|
|
Current
portion of debt, net |
$ 10,368 |
|
$ 72,692 |
|
Other current
liabilities |
98,641 |
|
71,849 |
|
Long-term debt, net |
291,104 |
|
214,421 |
|
Operating lease
liabilities, non-current |
60,546 |
|
267,221 |
|
Finance lease
liabilities and other lease financing liabilities, non-current |
261,913 |
|
20,121 |
|
Other non-current
liabilities |
231,974 |
|
182,326 |
|
Total stockholders’
(deficit) equity |
(46,617) |
|
71,801 |
|
Total Liabilities and Stockholders’
Equity (Deficit) |
$ 907,929 |
|
$ 900,431 |
We define “Adjusted Gross Profit” as
gross profit excluding non-cash inventory costs, which include depreciation and
amortization included in cost of goods sold, equity-based compensation included
in cost of goods sold, and other non-cash inventory adjustments. We define
“Adjusted Gross Margin” as Adjusted Gross Profit as a percentage of net
revenue. Our “Adjusted EBITDA” is a non-GAAP measure used by management that is
not defined by GAAP and may not be comparable to similar measures presented by
other companies. We define “Adjusted EBITDA Margin” as Adjusted EBITDA as a
percentage of net revenue. Management calculates Adjusted EBITDA as the
reported net loss, adjusted to exclude: income tax expense, other (income)
expense, interest expense, depreciation and amortization, depreciation and
amortization included in cost of goods sold, non-cash inventory adjustments,
equity-based compensation, equity-based compensation included in cost of goods
sold, start-up costs, start-up costs included in cost of goods sold,
transaction-related and other non-recurring expenses, gain or loss on sale of
assets, and litigation settlement. Accordingly, management believes that
Adjusted EBITDA provides meaningful and useful financial information, as this
measure demonstrates the operating performance of the business. The tables
below provide reconciliations of these non-GAAP measures to the most comparable
GAAP financial measure. Non-GAAP financial measures may be considered in
addition to the results prepared in accordance with GAAP, but they should not
be considered a substitute for, or superior to, GAAP results. The Company’s
presentation of these financial measures may not be comparable to similar
non-GAAP measures used by other companies. These financial measures are
intended to provide additional information to investors regarding the Company’s
performance.
The following table presents Adjusted Gross Profit for the quarter and year ended December 31, 2025 and 2024:
|
|
|
Three Months Ended |
|
Year Ended |
||||
|
($ in thousands) |
|
2025 |
|
2024 |
|
2025 |
|
2024 |
|
Gross Profit |
|
$ 45,126 |
|
$ 46,871 |
|
$ 169,680 |
|
$ 184,210 |
|
Depreciation and amortization included in cost of goods sold |
|
7,275 |
|
8,547 |
|
32,484 |
|
31,178 |
|
Equity-based compensation included in cost of goods sold |
|
315 |
|
882 |
|
1,946 |
|
7,659 |
|
Non-cash
inventory adjustments(1) |
|
1,979 |
|
636 |
|
15,862 |
|
2,859 |
|
Adjusted Gross Profit |
|
$ 54,695 |
|
$ 56,936 |
|
$ 219,972 |
|
$ 225,906 |
|
Adjusted Gross Margin |
|
45.4% |
|
41.9% |
|
43.9% |
|
40.2% |
(1)
Consists of write-offs of expired products, obsolete
packaging, and net realizable value adjustments related to certain inventory
items.
The following
table presents Adjusted EBITDA for the quarter and year ended December 31, 2025 and 2024:
|
|
|
Three
Months Ended December 31, |
|
Year
Ended December 31, |
||||
|
($ in thousands) |
|
2025 |
|
2024 |
|
2025 |
|
2024 |
|
Net loss |
|
$ (48,703) |
|
$ (16,791) |
|
$ (118,193) |
|
$ (84,994) |
|
Income tax expense |
|
16,237 |
|
10,789 |
|
51,378 |
|
45,172 |
|
Other (income) expense, net |
|
(189) |
|
391 |
|
(1,491) |
|
(707) |
|
Interest expense |
|
15,484 |
|
11,709 |
|
51,294 |
|
45,263 |
|
Depreciation and amortization |
|
20,529 |
|
17,468 |
|
73,530 |
|
66,157 |
|
Non-cash inventory adjustments(1) |
|
1,979 |
|
636 |
|
15,862 |
|
2,859 |
|
Equity-based compensation |
|
487 |
|
2,414 |
|
3,097 |
|
18,480 |
|
Start-up costs(2) |
|
4,336 |
|
856 |
|
13,044 |
|
3,185 |
|
Transaction-related and other non-recurring expenses(3) |
|
3,885 |
|
2,740 |
|
12,136 |
|
20,746 |
|
(Gain) loss on sale of assets |
|
(800) |
|
27 |
|
(745) |
|
16 |
|
Litigation settlement |
|
17,000 |
|
— |
|
17,000 |
|
— |
|
Adjusted EBITDA |
|
$ 30,245 |
|
$ 30,239 |
|
$ 116,912 |
|
$ 116,177 |
|
Adjusted EBITDA Margin |
|
25.1% |
|
22.2% |
|
23.4% |
|
20.7% |
(1)
Consists of write-offs of expired products, obsolete
packaging, and net realizable value adjustments related to certain inventory
items.
(2)
One-time costs
associated with acquiring real estate, obtaining licenses and permits, and
other costs incurred before commencement of operations at certain locations, as
well as incremental expenses associated with the expansion of activities at our
cultivation facilities that are not yet operating at scale, other expenses
resulting from delays in regulatory approvals, and other related one-time or
non-recurring expenses, as applicable. The three months and year ended December
31, 2025 include $3,162 and $9,855, respectively,
of unallocated overhead expenses at certain cultivation facilities resulting
from rebalancing of overhead expenses from cost of goods sold to general and
administrative expenses based on overhead allocations relative to production
output at those locations.
(3)
Other
non-recurring expenses including legal and professional fees associated with
litigation matters, potential acquisitions, other regulatory matters, and other
reserves or one-time expenses, including certain non-recurring professional
fees and severance expenses associated with certain strategic initiatives. The three months and year ended
December 31, 2025 each include a benefit of $1,250 related to a consideration adjustment for a
prior acquisition and a net benefit of $927 and $647,
respectively, related to fair value adjustments associated with acquisition
earn-outs. The year ended
December 31, 2025 includes
approximately $1,100 of expenses associated with term loans that were issued
during the year. The year
ended December 31, 2024 includes a reserve of $5,447 related to certain
amounts associated with a previous transaction, a reserve of $2,083 and a $984 discount that are associated with a
long-term receivable, approximately $3,600 of expenses associated with our 2024 debt refinancing, and
$630 related to an
acquisition earn-out.