Vireo Growth (VREO) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue excluding discontinued operations and New York rose 6.2% year-over-year to $22.4 million, led by double-digit growth in Maryland and improved core market execution.

• Operational improvements included higher harvest yields and better flower quality, with "A" flower quality rising to 47.0%.

• Recently secured a $10 million convertible loan at a premium to market to support strategy execution and Minnesota adult-use launch.

• Focus remains on divesting New York assets and expanding hemp-derived beverage and gummy product distribution.

Financial highlights

• GAAP revenue for Q3 2024 was $25.2 million, up 2.0% year-over-year; revenue excluding discontinued ops and NY was $22.4 million, up 6.2%.

• GAAP gross profit declined 6.6% to $12.3 million; gross margin fell 450 bps to 49.0%.

• Operating income dropped 34.4% to $3.9 million; EBITDA decreased 19.4% to $5.7 million (22.5% margin).

• Net loss for Q3 was $4.9 million, a slight improvement from $5.2 million loss in Q3 2023.

• Nine-month revenue excluding discontinued ops and NY grew 28.1% year-over-year to $66.1 million.

Outlook and guidance

• Preparing for adult-use sales launch in Minnesota in 2025, with near-term inventory build expected to impact inventory turns.

• Continued execution of CREAM & Fire strategy, focusing on profitability and operational efficiency.