Cannabis operator Tilray trims loss to $46 million in quarter on record sales

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Canadian cannabis producer Tilray Brands trimmed its loss to $46.2 million (61.6 million Canadian dollars) in the second quarter of its 2024 fiscal year on the back of record net sales.

Tilray reported second-quarter revenue of $193.8 million, a 34.4% improvement year-over-year – and in line with analysts’ expectations.

Revenue grew across all of the Leamington, Ontario- and New York-based company’s key operating segments, according to a Tuesday news release.

Cannabis sales in the quarter ended Nov. 30 were $67.1 million, a significant jump from 2023’s same quarter cannabis sales of $49.9 million.

Tilray’s distribution business experienced a revenue jump 12% year-over-year to $67.2 million in the quarter.

The wellness business saw the smallest increase in sales, growing 2.2% year-over-year to $12.9 million in the quarter.

Net revenue in the beverage alcohol segment more than doubled, to $46.5 million, compared to the same quarter last year, mainly through corporate acquisitions.

Tilray said it is now the fifth-largest craft beer brewer in the United States, citing “expected rankings” based on the Brewers Association’s annual report for 2022.

Adjusted EBITDA (interest, taxes, depreciation and amortization), a measure of comparative profitability, was $10.1 million in the second quarter, a slight decrease compared to the previous year’s quarter.

“We grew revenue, enhanced our capital structure, and realized operating synergies while strengthening Tilray Brands’ position as the #1 cannabis operation and brand portfolio in Canada by sales volume and market share, the European market leader in medical cannabis, and the leader in branded hemp products,” CEO Irwin Simon said in a statement.

For the fiscal year ending in May 2024, Tilray reiterated its adjusted EBITDA target of $68 million to $78 million.

Tilray also said it continues to expect to generate positive adjusted free cash flow in its 2024 fiscal year.

However, the company again changed its definition of adjusted free cash flow.

In the latest version of the definition, Tilray said adjusted free cash flow now excludes integration costs related to its September 2023 acquisition of eight beer and beverage brands from Anheuser-Busch.

Adjusted free cash flow for the second quarter was negative $18.4 million.

Free cash flow for the same quarter – without any adjustments – was negative $36.2 million.

Cash and cash equivalents as of Nov. 30 amounted to $143.4 million.

The company’s shares trade as TLRY on the Nasdaq and Toronto Stock Exchange.