Weekly Wrapup: Beyond the headlines for the week ended May 31, 2019

Our heads are spinning from the glut of earnings reports this week, but we’re happy to close out May with an even clearer view of how some of the largest public cannabis companies in the United States are performing.

Here’s a recap of the top newsmakers and deals that caught our eyes here at Investor Intelligence this week – plus a look at what we’ll be watching for next week.

Paving a path to profitability: Not a day went by this week that we didn’t learn something new about the operations and performance of major multistate cannabis firms in the U.S.

Big names – Acreage, Cresco Labs, Curaleaf, Green Thumb, Harvest Health, MedMen, Trulieve and so on and so on – reported earnings for the quarter ended March 31.

Here’s a quick snapshot of the top takeaways:

  • Florida-based Trulieve Cannabis Corp. continues to lead in revenues and profits among multistate public cannabis operators. The firm reported revenue for the first quarter of $44.5. million and more than doubled its profit to $14.7 million.
  • Profitability has continued to elude many other public cannabis firms – including Acreage Holdings, Curaleaf and others – with most citing investment in rapid nationwide expansion as their critical expense.
  • Scrutiny on spending is increasing among investors as they look for metrics to benchmark the rapid growth against returns. Perhaps one clear signal of this is MedMen’s move this week to slash executive salaries as the company logged another quarter of multimillion-dollar losses ($63.1 million, to be exact) in its fiscal third quarter. To curb administrative expenses, the firm said it was cutting the annual salaries of CEO Adam Bierman and President Andrew Modlin to $50,000 apiece. Bierman had been earning $1.5 million a year.

Curated with you in mind: Other top stories worth your time

  • Retail sales of medical and recreational cannabis in the United States are on pace to eclipse $12 billion by the end of 2019 – an increase of roughly 35% over 2018 – and could rise as high as $30 billion by 2023, according to exclusive projections from the 2019 edition of the Marijuana Business Factbook.
  • Marijuana businesses and investors seeking higher returns and more potential are looking beyond Canada’s relatively small and highly regulated market, analysts covering the still-nascent industry say.

Next Week:

  • Coming your way Monday: Investment Opportunity Assessment: U.S. Hemp. Investments in hemp are surging after the passage of the U.S. Farm Bill. This report will arm you with the key market metrics and geographic considerations investors like you should know as you size up opportunities as they unfold.

As always, please feel free to email me directly at [email protected] with your thoughts on what you value most from your subscription and what more you would like to see. Looking forward to hearing from you!

With that, enjoy the weekend!

Sincerely,

Lisa Bernard-Kuhn

Editor, Investor Intelligence