Trulieve Earnings + Call Notes
Trulieve Earnings + Call Notes
$303.4M Revs; est. $293.7M
$107M AEBITDA; est. $90.6M
$181.6M GP; est. $162.8M
$49.8M OI; est. $43.9M
59.8% GM; est. 55.4%
($12M) NI; est. ($18.5M)
($0.04) EPS; est. ($0.09)
$71.3m CFFO
$45m FCF
Call Notes
3rd consecutive quarter of top line growth / margin expansion.
FL recent polling showed supports in mid-upper 60s for A/U. đź‘€
To date, campaign received ~70 public endorsements from a wide range of bipartisan voices.
Launching at 3 A/U locations in OH today.
Believe could reach over $2b in annual sales.
Expect TCNNF brands to be on shelves by year end due to partnership w/ tier 1 processor.
3 additional retail locations planned in OH for early ’25.
21 affiliated dispensaries in PA.
Believe could reach over $4b in annual sales.
Last month celebrated 8 year anniversary of first TCNNF sale.
^ also first medical sale in FL.
Rev/margins beat guidance.
Revenue increased to $303, up 2% QoQ and 8% YoY.
Strong retail performance offset by higher 4/20 promo, seasonal headwinds in AZ, and refreshed loyalty program.
$107m aEBITDA / 35% margin, exceeded expectations.
^ driven by higher GM + cost controls.
3% increase in traffic, offset by 1% decrease in basket.
Sold over 11.5m branded products in Q2, up 4% QoQ.
Realizing softer conditions across the retail portfolio in Q3.
200 stores nationwide.
Rebranded all OH AZ retail locations to TCNNF brand.
Yields, potency, COGS at Jefferson facility remain at peak performance levels.
^ outperforming plan by double digits.
Expanding value focused brand offerings across markets.
Improved web platform launched in Q2.
Refreshed loyalty program rolled out in early June.
Fully stackable points able to be redeemed across all markets.
Exceeding goal in all markets.
80% of members have made at least 1 purchase since opting in.
In April, rolled out machine learning for basket analysis / customer messaging.
Last week completed a significant upgrade to SAP platform.
Infrastructure announcements to increase in back half of ’24.
GM will continue to fluctuate QoQ.
34% SG&A margin, in line w/ Q1.
aEBITDA up $1m to $107m; 35% margin.
To date received $115m refund checks, $2m received in Q2.
If 280e were to be removed, would have positive net income for Q1 / Q2.
$71m CFFO, $26m CAPEX, $45m FCF.
Anticipate Q3 revs to be down mid-single digits from Q2, up mid-single digits YoY.
Contributions from store openings + OH, offset by seasonal headwinds in AZ + FL.
Increasing FY target to at least $250m CFFO and CAPEX of $100m. đź‘€
On track to open at least 25 stores in ’24. 👀
A/U in FL would represent the largest conversion in cannabis history.
Market could reach $6b in sales.
In ’23, sold 135% more flower than the average store in FL.
86% of retail network serving medical patients.
Positioned well for future A/U markets (incl FL PA).
Some unforeseen positive influence on GM.
Jeffco was firing on all cylinders, also had some legacy capacity brought back online that outperformed fairly significantly during the quarter.
Internal assumptions have to do w/ yield, very strain specific.
Depends on how that plays out from a customer preference perspective.
Product mix a large contributor to GM QoQ.
Going to continue being a leader for FL A/U initiative.
Continuing to work w coalitions / additional companies + supporters.
Feel in a great posture in B/S to continue to invest into FL A/U campaign, extraordinary high ROI on those dollars.
Supporting growth initiatives across the portfolio.
^ investing in retail in OH, store build outs.
Some softer traffic in markets w/ summer seasonality.
Seeing some shift in consumer preferences with a bit more shifting towards value. đź‘€
Saw some trading up at beginning of Q2, dropped off throughout Q2.
AZ a core market.
Needs to be an important market.
Saw some positives during the quarter.
Adoption rate of loyalty program was very exciting (allows consumer data capture / marketing to a wider audience), now a unified platform in AZ.
AZ as a whole in statewide data seeing some pressure.
TCNNF market share increasing as AZ continues downward trend.
AZ very seasonal, Q3 w/ the most seasonality pressure, then rebalancing into Q4/Q1.
Internal brands performing well in PA.
Built data in PA to be very tuned into customers, have adjusted product mix to their shifting demand over time.
CAPEX a result of a few things.
Have an opportunity to invest additional dollars in OH for A/U conversion, will be investing there (3 additional stores opening hopefully “very very” early ’25) + additional capacity across the portfolio (brought some legacy capacity online to support current states).
OH cultivation agreement will track as a VIE.
Very comfortable w/ cash position.
Important to fully execute against current opportunities.
A mistake in business to take eye off of what’s in front of you, to chase a shiny object.
Don’t think there are any opportunities today that won’t exist past Nov 5th.
Important to focus on FL A/U finish line.
Want to remain opportunistic on M&A front, but largest opportunity in cannabis sector (FL A/U) is in front of TCNNF.
Focused on realizing that first.
Two express locations open currently.
Performing at / above expectations, depending on the metric.
Will incorporate more of this style of store into the portfolio, where it makes sense.
Markets w/o seasonal pressure still seeing consistent purchasing patterns.
Not seeing seasonal weakness across entire portfolio in uniform way that would point to a macro shift showing up in consumer patterns. đź‘€
Phenomenal job in driving down costs over the last year.
Guiding to mid-50s GM (unchanged QoQ).
Opportunity through partnership to have an additional 2 retail locations in OH in the future.
five-year weekly chart
/end
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CB1 has a position and nothing contained herein should be considered advice.
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