Canadian cannabis producer Tilray reported an annual loss of $336 million (422 million Canadian dollars) for its fiscal year ended May 31, capping off a transformative year in which the company closed a reverse-merger with Aphria and bought U.S. brewer SweetWater Brewing Co.
The financial data include four weeks of results flowing from the merger with Aphria, which closed May 3.
Tilray attributed its annual net loss to transaction costs from the Aphria deal plus a $170 million unrealized loss on convertible debentures.
On a quarterly basis, net revenue increased 16% over the previous three-month period to $142 million, helping the company post net income of $33.6 million.
However, cannabis sales ($53.7 million) accounted for only 38% of overall net revenue.
Besides cannabis, British Columbia-based Tilray’s revenue consisted of:
- Distribution ($66.7 million, or 47% of sales).
- Beverage alcohol ($16 million, or 11% of sales).
- Wellness ($5.8 million, or 4% of sales).
Adjusted EBITDA, a measure of profitability, was $12.3 million during the fourth quarter.
Distribution revenue, which comes from the company’s CC Pharma subsidiary in Germany, declined from the previous quarter.
Tilray said business operations in Germany were shut down for three days in July due to flooding, which will have an impact of up to $4 million.
Free cash flow increased to $3.3 million.
In a conference call with analysts to discuss the quarter, CEO Irwin Simon said Tilray is aiming to achieve $4 billion in sales by the end of 2024.
He said the forecast includes expected sales in the United States of up to $1.5 billion.
Irwin outlined two paths to possible expansion in the U.S.
The first route is alcohol and food goods, which could be converted to THC and CBD products once legalization in the U.S. happens.
“Alongside that, (Tilray) would be looking at optionality and investments in (multi-state operators) that make sense, that strategically align with Tilray, and look to acquire or merge with them 100% once legalization does happen,” he said.
Irwin said the company needs to remain flexible to compete against smaller producers.
“We have to remain nimble, flexible and entrepreneurial. If not, a lot of the little guys will nibble at us,” he said.
Shares of Tilray trade on the Nasdaq as TLRY.