Ayr Wellness Inc. (CSE: AYR.A, OTCQX: AYRWF), a vertically integrated U.S. multi-state cannabis operator (MSO) constituent in the rebalanced munKNEE American Cannabis MSO Index, reported its Q3 financial report for the period ended September 30, 2023, last Thursday and the results are presented below in U.S. dollars with Q3 being compared to Q2.
Q3 Financial Summary ($ in millions, excl. margin items)
Cash on Hand: $72.8M
David Goubert, President & CEO, said:
- [W]e will remain focused on our liquidity and working capital as we further optimize inventory levels and align production with demand across our markets.
- We expect the execution of our objectives to position us for revenue growth, adjusted EBITDA margin expansion and free cash flow generation in 2024.”
Q3 Operational Highlights
- Reported Q3 retail transactions up 21% year-over-year on same-store basis.
- Announced agreement to acquire third Ohio dispensary license.
- Announced three-year exclusive licensing and retail agreement to bring Kiva Confections to AYR’s 62+ Florida dispensaries.
- Added Michael Warren to the Company’s Board of Directors.
- Changed expense allocation methodology resulting in an expense reclassification from SG&A to COGS that resulted in a 300bps reduction in adjusted gross margin in Q3.
Due to the modest sequential revenue decline in the third quarter, coupled with the temporary cultivation setback in Florida that will impact fourth quarter revenue by approximately $4-6 million, the Company no longer anticipates growth for the second half of 2023 over first half levels. The Company now expects revenue to be essentially flat in the fourth quarter compared to the third quarter, and to maintain an adjusted EBITDA margin of 25% in the fourth quarter.
Ayr’s stock price:
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