Curaleaf Holdings, Inc. Reports Strong Q1 2023 Results, Exceeding Revenue Expectations
LOS ANGELES– Curaleaf Holdings, Inc, a global provider of consumer products in the cannabis industry, announced its financial and operating results for the first quarter ended March 31, 2023. The company’s performance exceeded expectations, demonstrating substantial revenue growth and a focus on responsible growth strategies.
During the first quarter of 2023, Curaleaf achieved a year-over-year revenue increase of 14%, reaching $336.5 million, surpassing the company’s projected low double-digit growth. Notably, adjusted gross margin stood at 48%, while adjusted EBITDA margin reached 22%. The company also reported $116 million in cash on its balance sheet and generated $31 million in operating cash flow from continuing operations during the quarter.
Curaleaf’s Executive Chairman, Boris Jordan, expressed satisfaction with the strong start to 2023 and emphasized the company’s strategic investments both domestically and internationally. Jordan highlighted the company’s optimistic outlook for robust growth in the coming years, particularly as cannabis adoption accelerates across Europe. He emphasized Curaleaf’s strong financial position, ample cash reserves, and ongoing investments that position the company for years of market share expansion.
Matt Darin, Chief Executive Officer of Curaleaf, emphasized the company’s focus on profitability and responsible growth. Darin highlighted their efforts to optimize operational efficiencies, drive margin improvements, achieve operating leverage, and generate cash. Curaleaf aims to strengthen its brand portfolio, innovate new products, and deliver exceptional retail experiences for its customers.
Operational highlights for the first quarter of 2023 included exceeding the expense reduction plan by $20 million, resulting in anticipated cost savings and improved inventory positions. Curaleaf also opened three additional dispensaries in Florida, bringing the total to 58 in the state. The company strategically closed operations in California, Colorado, and Oregon to enhance efficiency. Additionally, Curaleaf expanded its product offerings, launching the flavor-forward cannabis edibles brand called JAMS in Arizona and Florida. The company extended the reach of its Grassroots, Find, and B Noble brands to New Jersey and Florida, while also commencing adult-use cannabis sales in Connecticut.
Following the first quarter, Curaleaf accomplished significant milestones, including the acquisition of Deseret Wellness in Utah, which added three additional stores, bringing the total to four in a market of 15. The company continued its retail expansion in Florida, opening two additional stores and increasing its nationwide retail operations to a total of 152 stores as of May 17, 2023. Curaleaf achieved record-breaking sales on April 20, led by New Jersey, where sales marked a remarkable 77% increase compared to the previous year, making it the highest sales day in New Jersey’s history. Additionally, the company launched a new mobile app and loyalty program, garnering 1.9 million members to date. Curaleaf further expanded its Grassroots brand to Florida.
Curaleaf’s total revenue for the first quarter of 2023 reached a record $336.5 million, with retail revenue accounting for $273 million, representing 81% of the total revenue. Wholesale revenue stood at $62.1 million, comprising 18% of total revenue. The company’s net loss attributable to Curaleaf Holdings, Inc. was $54.4 million for the quarter, mainly attributed to reduced gross margin rates due to price compression.
As of March 31, 2023, Curaleaf held a cash position of $115.8 million and had outstanding debt net of unamortized debt discounts amounting to $593.8 million. The company invested $26 million, net, in capital expenditures during the first quarter, primarily focused on cultivation, processing, and selective retail expansion in strategic markets.
Curaleaf’s strong financial performance and growth strategies position the company favorably within the rapidly evolving cannabis industry. The company’s commitment to responsible and profitable growth, along with ongoing product innovation and expansion efforts, demonstrates its dedication to delivering value to its stakeholders.
Curaleaf will host a conference call on May 17, 2023, at 5:00 P.M. ET to discuss its first-quarter earnings results. Interested individuals can access the call by dialing the provided numbers and using the conference ID. A replay of the conference call will be available for a limited period.
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