Harvest Health and Recreation Q1 revenue Doubles to $89 Million – New Cannabis Ventures
5 min read
Harvest Health & Recreation Inc. reports financial results for the first quarter of 2021 First quarter revenue was $ 88.8 million, up 101% from the first quarter of 2020 and 27% from the previous quarter’s Adjusted EBITDA for the fourth Quarter 2020 was $ 26.9 million in the first quarter. This represents an increase of 196% from $ 9.1 million in the fourth quarter of 2020. 2021 Revenue target increased to at least $ 400 million
PHOENIX, May 10, 2021 / PRNewswire / – Harvest Health & Recreation Inc. (“Harvest” or the “Company”) (CSE: HARV, OTCQX: HRVSF), a vertically integrated cannabis company and multi-state operator in the United States . The financial and operating results for the first quarter of 2021 were released today. All financial information is presented in US dollars unless otherwise stated.
Financial results for the first quarter of 2021
Total revenue for the first quarter was $ 88.8 million, up 101% from $ 44.2 million in the first quarter of 2020 and up 27% from $ 69.9 million in the fourth quarter of 2020 first quarter was $ 47.9 million. compared to $ 18.1 million in the first quarter of 2020 and $ 31.3 million in the fourth quarter of 2020. Gross profit margin was 53.9% for the first quarter, compared with 41.0% in the first quarter of 2020 and 44.8 % for the fourth quarter of 2020 2020. Net loss before non-controlling interests was $ 23.0 million for the first quarter compared to $ 7.4 million for the fourth quarter of 2020. Adjusted EBITDA for the first quarter was $ 26.9 million compared to $ 9 . $ 1 million in the fourth quarter of 2020.
For more information on the use of non-GAAP financial measures and the reconciliation of non-GAAP financial measures, see the supplementary information.
Business highlights of the first quarter of 2021
On January 22, 2021, Harvest recorded the first recreational cannabis sales in the state of Arizona at its Scottsdale location. On January 22nd, Harvest began serving adult customers in addition to medical patients in all 15 pharmacies. On January 25, 2021, Harvest announced the completion of a sale-leaseback transaction with Innovative Industrial Properties, Inc. Harvest sold a 292,000 square foot facility for $ 23.8 million. Harvest will operate the cultivation and processing facility and expects tenant improvements of up to $ 10.8 million. On February 22, 2021, Harvest announced the sale of two medical marijuana dispensaries in Bismarck and Williston, North Dakota, for an insignificant amount of money. On March 11, 2021, Harvest opened a new pharmacy in Whitehall, Pennsylvania. On March 15, 2021, Harvest announced the resolution of its dispute with Falcon International, Inc. Under the settlement terms, Harvest now owns a 10% stake in Falcon and has received a ten year warrant to purchase up to 20% of the company’s shares at an exercise price of $ 1.91 per share. As of March 31, 2021, Harvest owned, operated, or managed 37 retail locations in six states, including 15 open pharmacies in Arizona.
Recent developments
Harvest opened two new medical retail pharmacies in Florida on May 5th and 6th in Olympia Heights and West Palm Beach. On May 7, 2021, Harvest announced that an agreement had been reached on the AGRiMED Industries Producer / Processor Committee of PA, LLC. On May 10, 2021, Trulieve announced the proposed acquisition of Harvest. It is expected that each Harvest shareholder will receive 0.117 Trulieve shares for each Harvest share for a total of approximately $ 2.1 billion. The implied price per Harvest share is $ 4.79, a 34% premium over the closing price of Harvest stock on May 7, 2021.
outlook
Harvest increases its revenue target for full year 2021 to at least $ 400 million. Reported gross margins are expected to be at or above 50% and are expected to continue to fluctuate from quarter to quarter.
Management comment
Our results for the first quarter show the benefits of meeting key milestones such as the launch of recreational sales in Arizona.
CEO Steve White
We are focused on our top operational and financial priorities in 2021 as we build on that positive momentum.
Conference call & webcast
Harvest Health and Recreation Inc. will host a conference call and audio webcast with Chief Executive Officer Steve White on Monday, May 10, 2021 at 8:00 a.m. Eastern Time.
Registration for this event is required. Please use this link to register: http://www.directeventreg.com/registration/event/4832288
After registration, an email confirmation will be sent with dial-in details and unique conference call codes. The registry remains open during the call. However, we recommend that you register in advance in order to access the event.
The first quarter results will be available at: https://investor.harvesthoc.com/financials/default.aspx
The live webcast and replay of the conference call are available at: https://investor.harvesthoc.com/financials/default.aspx
Use of non-GAAP financial measures
This press release contains certain non-GAAP financial measures as defined by the SEC. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are provided below. This information should be viewed as a supplement, and not as a substitute for or superiority to any GAAP measure of performance. Our management uses the Adjusted EBITDA to evaluate our operating performance and trends, and to make planning decisions. Our management believes that Adjusted EBITDA helps identify underlying trends in our business that might otherwise be masked by the effects of the items we excluded. Accordingly, we believe that Adjusted EBITDA provides investors and others with useful information to understand and evaluate our operating results, improve their general understanding of our past performance and future prospects, and provide greater visibility into key financials generated by our Management can be used in its financial and operational decision-making.
Reconciliation of non-GAAP financial measures
The table below reconciles net income (loss) for the periods indicated with Adjusted EBITDA.
About Harvest Health & Recreation Inc.
Harvest Health & Recreation Inc., headquartered in Tempe, Arizona, is a vertically integrated cannabis company and multi-state operator. Since 2011, Harvest has been committed to expanding its retail and wholesale presence in the United States, purchasing, manufacturing and selling cannabis products for patients and consumers, and providing services to retail pharmacies. Through organic licensing gains, service agreements, and targeted acquisitions, Harvest has built an operational footprint that spans multiple states. US Harvest’s mission is to make life better through the goodness of cannabis. We hope that you will join us on our journey: https://harvesthoc.com
Facebook: @HarvestHOC
Instagram: @HarvestHOC
Twitter: @HarvestHOC
Original press release
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