Rubicon Organics (ROMJ) Q4 2024 earnings summary

Executive summary

• Achieved record net revenue of CAD 48.7 million for 2024, up 21% year-over-year, and CAD 14.2 million in Q4, up 42% from Q4 2023.

• Adjusted EBITDA reached CAD 4 million for 2024 (including CAD 900,000 one-time ERP costs); Q4 Adjusted EBITDA was CAD 1.6 million (including CAD 250,000 ERP costs).

• Achieved three consecutive quarters of profit from operations and three years of positive Adjusted EBITDA.

• Expanded production capacity by over 40% with the acquisition of the Hope, BC facility and executed the first international shipment to Poland.

• Maintained leading market share in premium cannabis categories, including flower, pre-rolls, vapes, edibles, and topicals.

Financial highlights

• Gross profit for 2024 was CAD 15.3 million before fair value adjustments, with a gross margin of 36% in Q4, up from 25% in Q1.

• Net profit from operations in Q4 was CAD 292,000, marking the third consecutive profitable quarter.

• Operating cash flow for 2024 was CAD 3.4 million, with Q4 contributing CAD 2.3 million; free cash flow for 2024 was CAD 1.9 million.

• Cash and cash equivalents at year-end were CAD 9.9 million; working capital was just under CAD 20 million.

• Inventory expense to cost of sales increased to 43% in 2024 due to price pressure and product mix.

Outlook and guidance

• Forecasting growth in both net revenue and Adjusted EBITDA for 2025, with Adjusted EBITDA impacted by pre-revenue costs from the Hope facility.

• Hope facility expected to add 4,500 kg annual capacity (40% increase), with full benefits in 2026 and incremental 3,000 kg production anticipated.

• Plan to secure an additional 2,000 kg of third-party contract supply in 2025.

• Continued focus on domestic market leadership, brand trust, and innovation, with international expansion in a test-and-learn phase.