Trulieve Cannabis Posts 24% Profit Increase As Demand For Cannabis Soars

LOS ANGELES– On Wednesday, Trulieve Cannabis Corp (TRUL.CD) announced a 24 percent increase in fourth-quarter adjusted core profit, owing to high demand for cannabis.

Trulieve’s stock was trading at C$26.48, up 2.3 percent.

The findings come as a cannabis decriminalization bill is set to be voted on in the United States House of Representatives this week, sparking renewed investment interest in the sector.

“Clearly, we would all like to see federal change, and the American people are certainly supportive,” Kim Rivers, the company’s CEO, told Reuters.

She did clarify, though, that the industry has not been pushed by the need for a legislative shift.

“This is a state-by-state operation, and what’s going on at the state level is having a bigger influence on our businesses and people’s access to cannabis right now than what’s going on at the federal level,” Rivers continued.

Trulieve, which has operations in 11 states including Arizona, Florida, and Pennsylvania, reported an 81 percent increase in fourth-quarter sales to $305.3 million, driven by its $2.1 billion purchase of medical cannabis producer Harvest Health.

Revenue for the full year 2022 is expected to be in the range of $1.3 billion to $1.4 billion, with adjusted core earnings in the range of $450 million to $500 million, according to the business.

According to industry research firm BDSA, cannabis sales in the United States are expected to reach $46 billion by 2026, when states like New York and New Jersey open up.

Margin and profit margins remain tight, prompting calls from investors and analysts for consolidation to increase profitability through scale savings.

Trulieve Cannabis lost $71.5 million in the quarter ending Dec. 31, compared to a profit of $3 million the year before.

The company incurred $73.3 million in non-recurring fair value inventory step-up and acquisition charges, largely related to the Harvest purchase.