Debra Borchardt
Ascend Wellness Holdings Inc. (CSE: AAWH.U) (OTCQX: AAWH) reported its financial results for the three months ending June 30, with gross revenue increasing to $151 million, up 28.4% year-over-year and 7.0% quarter-over-quarter.
The company reported net revenue of $122 million. Ascend said in its earnings presentation that it remained on track to generate cash from operations for the 2023 fiscal year.
The company reported net income of $0.8 million during the quarter, an improvement over the net loss of $21.2 million for the same time period last year. It was also a sequential improvement over the first quarter’s net loss of $18.5 million.
“I am proud of the company for achieving another quarter of record revenue and cash generation, fueled by growth across both our retail and wholesale businesses,” said Abner Kurtin, executive chairman. “We were able to deliver a meaningful 26% revenue increase compared to last year and an 8% increase compared to the prior quarter.”
Retail Detail
Total retail revenue in the second quarter of 2023 grew by 8.6% sequentially to $89.9 million and increased retail sales by 19% year-over-year. The company said the improvement was driven by the full quarter benefit of the dispensaries in New Bedford, Massachusetts, and Century, Michigan, the opening of the Tinley Park, Illinois, dispensary, and the acquisition of four dispensaries in Maryland.
Ascend reported that this was the third quarter in a row with more than a million transactions. In addition, 48% of retail revenue was generated from products Ascend produces. The company said it had a successful start of adult-use sales in Maryland when it integrated, re-branded, and flipped four dispensaries from medical only in a matter of weeks.
“With the team’s strong performance in the quarter, we remain optimistic about the future of the business and continue to see substantial growth across all areas, particularly in our retail outlet model.,” CEO John Hartmann said. “As we expand our presence into Maryland’s adult-use market and closely monitor Ohio’s upcoming recreational cannabis ballot, we are confident in Ascend’s continued success and potential for further growth.”
The company noted in its presentation that it expects to open an additional four stores in 2023 and another four stores in 2024.
“Our dedication to producing cash flow is evident as we generated nearly $8 million in cash from operations, excluding the receipt of the ERTC, and approached being free cash flow positive for the quarter,” CFO Dan Neville added. “Further, we remain on track to generate cash from operations for the full year, marking a significant milestone in the Company’s journey to self-sufficiency.”
