Curaleaf Reports Record Second Quarter 2021 Results

 
 

- Second quarter 2021 Revenue (1) of $312 million , up 20% sequentially and 166% YoY  

 

- Second quarter 2021 Adjusted EBITDA margin of 28% on core U.S. operations, up 400 bps QoQ  

 

- Second quarter 2021 Adjusted EBITDA (1) of $84 million , up 35% sequentially and 201% YoY  

 

- Closed acquisition of EMMAC, Europe's largest vertically integrated cannabis company  

 

  WAKEFIELD, Mass. , Aug. 9, 2021 /PRNewswire/ -- Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) ("Curaleaf" or the "Company") , a leading international provider of consumer products in cannabis, today reported its financial and operating results for the second quarter ended June 30, 2021 . All financial information is provided in U.S. dollars unless otherwise indicated.

 

 
                                                                         
 

   Second Quarter 2021 Financial Highlights   

 
 

   ($ thousands, except per share amounts)   

 
 
 

   Q2 2021   

 
 
 

   Q1 2021   

 
 

   % qoq
Change
 
 

 
 
 

   Q2 2020   

 
 

   % yoy
Change
 
 

 
 

  Total Revenue  

 
 

  $  

 
 

  312,205  

 
 

  $  

 
 

  260,320  

 
 

  20%  

 
 

  $  

 
 

  117,480  

 
 

  166%  

 
 

  Gross profit before impact of biological assets  

 
 

  $  

 
 

  155,238  

 
 

  $  

 
 

  128,467  

 
 

  21%  

 
 

  $  

 
 

  60,636  

 
 

  156%  

 
 

  Gross profit on cannabis sales (1)(2)  

 
 

  $  

 
 

  154,527  

 
 

  $  

 
 

  128,030  

 
 

  21%  

 
 

  $  

 
 

  42,735  

 
 

  262%  

 
 

  Gross margin on cannabis sales (1)(2)  

 
 
 

  49.6%  

 
 
 

  49.3%  

 
 
 
 

  42.9%  

 
 
 

  Adjusted EBITDA (1)  

 
 

  $  

 
 

  84,372  

 
 

  $  

 
 

  62,625  

 
 

  35%  

 
 

  $  

 
 

  27,994  

 
 

  201%  

 
 

  Net income (loss) attributable to Curaleaf Holdings Inc.  

 
 

  $  

 
 

  (7,240)  

 
 

  $  

 
 

  (17,211)  

 
 
 

  $  

 
 

  (2,029)  

 
 
 

  Net income (loss) per share – basic and diluted  

 
 

  $  

 
 

  (0.01)  

 
 

  $  

 
 

  (0.03)  

 
 
 

  $  

 
 

  (0.00)  

 
 
 
 
 
      
 
 
 

  (1)  

 
 

  See "Non-IFRS Financial and Performance Measures" below for more information regarding Curaleaf's use of Non-IFRS financial measures and other reconciliations.  

 
 

  (2)  

 
 

  Cannabis sales excludes Management Fee Income  

 
 
 

 

 
 
             
 

   Earnings Call: Monday, August 9, 2021, at 5:00 P.M. ET   

 
 

  Conference ID # is 1222509  

 
 

  Replay ID # is 10158196  

 
 
 

  U.S. Live Call: 1 (888) 317 6003  

 
 

  U.S. Replay: 1 (877) 344 7529  

 
 

  International Live Call (Toll): 1 (412) 317 6061  

 
 

  International Replay (Toll): 1 (412) 317 0088  

 
 

  Canadian Live Call: 1 (866) 284 3684  

 
 

  Canadian Replay: 1 (855) 669 9658  

 
 
 

  The teleconference will be available for replay starting at approximately 7:00 P.M. ET  

 
 

  on August 9, 2021 and will end at 7:00 P.M. ET on August 16, 2021  

 
 
 

  Boris Jordan , Executive Chairman of Curaleaf commented, "July saw the introduction of the most comprehensive cannabis reform ever proposed at the Federal level. Combined with U.S. state-level liberalization and the significant investments we are making in cultivation, production and distribution, Curaleaf is creating a strong foundation for future growth. Nearer-term this includes the expansion of New York , New Jersey and Connecticut from medical to adult-use markets representing a potential new $8 billion annual addressable market opportunity. Longer-term, our acquisition of EMMAC and establishment of Curaleaf International this quarter marks our entry into Greater Europe , with a population of 750 million representing a potential market size twice that of the United States ."

 

  Joe Bayern , Chief Executive Officer of Curaleaf stated, "Curaleaf continues to make excellent progress in terms of executing our U.S. strategy to achieve unrivaled scale and reach, and our record second quarter results reflect this. Our leading positions in cultivation and distribution are driving some of the strongest revenue growth rates in the sector, while our scale and focus on cost efficiency are delivering Adjusted EBITDA margin expansion as promised. Looking ahead, our strategic investments in innovation and technology will deliver processing advantages and consumer-focused product differentiation to fuel our growth into 2022 and the years beyond."

 

  Second Quarter Highlights  

 
  • Revenue reached $312 million , increasing 20% sequentially and 166% YoY.
  •  
  • U.S. operations reported revenue of $307 million , 18% growth QoQ, within our guidance range.
  •  
  • Gross margin reached approximately 50%, an increase of 669 basis points YoY, driven by higher yields at existing cultivation facilities and new state-of-the-art facilities coming online.
  •  
  • SG&A expense reached $88 million . Excluding Curaleaf International, SG&A expense represented 26.4% of revenue, a sequential improvement of 435 basis points driven by operating efficiencies.
  •  
  • Adjusted EBITDA reached $84 million , up 201% YoY, and equivalent to a margin of 27.0%. Excluding Curaleaf International, the margin expanded 400 basis points sequentially to 28.1%.
  •  
  • Successfully closed the acquisition of EMMAC, Europe's largest vertically integrated independent cannabis company, which has formed the foundation of our Curaleaf International business.
  •  
  • In May, agreed to acquire Los Suenos, a 66-acre outdoor grow in Colorado .
  •  
  • Brought online nearly 250 thousand square feet of flower canopy during the first half of the year, with a further 40 thousand square feet planned for the second half of 2021.
  •  
  • Opened five new stores in Illinois , Pennsylvania , New Jersey , and Maine bringing total retail locations to 107.
  •  
  • Launched a long-term strategic partnership with Rolling Stone to leverage our Select brand and operating experience in Nevada .
  •  

  Post Second Quarter Highlights  

 
  • Opened a medical dispensary in Wells, Maine , bringing total retail dispensaries to 108 as of today.
  •  
  • Launched B. Noble pre-roll brand partnership in Maryland and Massachusetts .
  •  

  Financial Results for the Second Quarter Ended June 30, 2021   

 

Total revenue increased by 166% year-over-year to $312 million during the second quarter of 2021, compared to $117 million in the second quarter of 2020. Excluding international operations, total revenue was $307 million .

 
 
                                      
 

   Revenue   

 
 

   ($ thousands)   

 
 
 
 
 

   Q2 2021   

 
 
 

   Q1 2021   

 
 
 

   Q2 2020   

 
 

  Retail revenue  

 
 

  $  

 
 

  222,147  

 
 

  $  

 
 

  187,677  

 
 

  $  

 
 

  66,275  

 
 

  Wholesale revenue  

 
 
 

  89,347  

 
 
 

  72,206  

 
 
 

  33,304  

 
 

  Management fee income  

 
 
 

  711  

 
 
 

  437  

 
 
 

  17,901  

 
 

  Total Revenue  

 
 

  $  

 
 

  312,205  

 
 

  $  

 
 

  260,320  

 
 

  $  

 
 

  117,480  

 
 
 

During the second quarter we opened five new dispensaries including two in Pennsylvania , one in Illinois , a second location in New Jersey and the first adult-use store in Maine , reaching 107 dispensaries as of quarter end.

 

Retail revenue reached $222 million , sequential growth of 18.4% and year-over-year growth of 235%. Strong growth in our retail operation was primarily driven by new customer acquisition and an increase in repeat customers. Retail revenue represented 71% of total revenue.

 

Wholesale revenue grew 23.7% sequentially and 168% year-over-year to reach $89 million and represented 29% of total revenue. Strong growth in our wholesale operation was driven by the addition of new accounts and an increase in sales productivity.

 
 
                               
 

   Gross Profit on Cannabis Sales   

 
 

   ($ thousands)   

 
 
 
 
 

   Q2 2021   

 
 
 

   Q1 2021   

 
 
 

   Q2 2020   

 
 

  Retail and wholesale revenue  

 
 

  $  

 
 

  311,494  

 
 

  $  

 
 

  259,883  

 
 

  $  

 
 

  99,579  

 
 

  Cost of goods sold  

 
 
 

  156,967  

 
 
 

  131,853  

 
 
 

  56,844  

 
 

  Gross profit on cannabis sales  

 
 

  $  

 
 

  154,527  

 
 

  $  

 
 

  128,030  

 
 

  $  

 
 

  42,735  

 
 
 

Gross profit was $155 million for the second quarter of 2021, compared to $43 million in the second quarter of 2020. Gross profit margin reached 49.6%, equivalent to a year-over-year increase of 669 basis points. The margin gain was primarily due to increased operating capacity coming online as well as efficiency gains in cultivation and processing.

 
 
                                                                  
 

   Net Income / (Loss)   

 
 

   ($ thousands)   

 
 
 
 
 

   Q2 2021   

 
 
 

   Q1 2021   

 
 
 

   Q2 2020   

 
 

  Total Revenue  

 
 

  $  

 
 

  312,205  

 
 

  $  

 
 

  260,320  

 
 

  $  

 
 

  117,480  

 
 

  Gross profit  

 
 
 

  184,495  

 
 
 

  125,462  

 
 
 

  81,227  

 
 

  Income (Loss) from operations  

 
 
 

  51,886  

 
 
 

  20,627  

 
 
 

  21,691  

 
 

  Total other income (expense), net  

 
 
 

  (19,026)  

 
 
 

  (17,893)  

 
 
 

  (9,993)  

 
 

  Income tax benefit (expense)  

 
 
 

  (42,624)  

 
 
 

  (37,843)  

 
 
 

  (13,534)  

 
 

  Net loss  

 
 
 

  (9,764)  

 
 

  $  

 
 

  (17,211)  

 
 
 

  (1,836)  

 
 

  Less: Net income (loss) attributable to non-controlling interest  

 
 
 

  (2,524)  

 
 
 

  

 
 
 

  193  

 
 

  Net loss attributable to Curaleaf Holdings, Inc.  

 
 

  $  

 
 

  (7,240)  

 
 
 

  (17,211)  

 
 

  $  

 
 

  (2,029)  

 
 
 

For the second quarter of 2021, net loss attributable to Curaleaf Holdings, Inc. was $7 million , compared to a net loss of $17 million in the first quarter of 2021. The net result this quarter was impacted by higher stock-based compensation and one-time charges related to the acquisition of EMMAC (now Curaleaf International) as well as earnings dilution from the consolidation of EMMAC, which contributed with a net loss of approximately $8 million .

 
 
                                                                         
 

   Adjusted EBITDA   

 
 

   ($ thousands)   

 
 
 
 
 

   Q2 2021   

 
 
 

   Q1 2021   

 
 
 

   Q2 2020   

 
 

  Net income (loss)  

 
 

  $  

 
 

  (9,764)  

 
 

  $  

 
 

  (17,211)  

 
 

  $  

 
 

  (1,836)  

 
 

  Interest expense, net  

 
 
 

  21,330  

 
 
 

  20,623  

 
 
 

  9,916  

 
 

  Income tax expense  

 
 
 

  42,624  

 
 
 

  30,708  

 
 
 

  13,534  

 
 

  Depreciation and amortization (1)  

 
 
 

  35,030  

 
 
 

  30,155  

 
 
 

  17,869  

 
 

  Share-based compensation  

 
 
 

  18,370  

 
 
 

  4,907  

 
 
 

  4,833  

 
 

  Other (income) expense  

 
 
 

  (2,304)  

 
 
 

  (415)  

 
 
 

  77  

 
 

  Change in fair value of biological assets  

 
 
 

  (29,257)  

 
 
 

  (12,347)  

 
 
 

  (20,591)  

 
 

  One time charges (2)  

 
 
 

  8,343  

 
 
 

  6,206  

 
 
 

  4,192  

 
 

  Adjusted EBITDA  

 
 

  $  

 
 

  84,372  

 
 

  $  

 
 

  62,625  

 
 

  $  

 
 

  27,994  

 
 
 
 
      
 
 
 

  (1)  

 
 

  Depreciation and amortization expense in Q2 2021, Q1 2021, and Q2 2020 include amounts charged to cost of goods sold on the statement of profits and losses.  

 
 

  (2)  

 
 

  One time charges in Q2 2021 include expenses related to the acquisition of EMMAC.  

 
 
 

Adjusted EBITDA was a record $84 million for the second quarter of 2021, compared to $28 million for the second quarter of 2020. The year-over-year increase was primarily driven by strong revenue growth and increased operating leverage. Adjusted EBITDA margin expanded 320 basis points year-over-year to reach 27.0%. Excluding Curaleaf International, the margin expanded 400 basis points sequentially and 423 basis points year-over-year to 28.1%.

 

  Balance Sheet and Liquidity  

 

As of June 30, 2021 , the Company had $334 million of cash and $338 million of outstanding debt net of unamortized debt discounts.

 

  Capital Expenditures  

 

During the second quarter of 2021, Curaleaf invested $41.9 million net in capital expenditures, focused on cultivation, processing, and selective retail expansion in strategic markets.

 

  Shares Outstanding  

 

As of June 30, 2021 and March 31, 2021 , our weighted average shares outstanding amounted to 701,668,932 and 682,041,420 shares, respectively.

 

As of June 30, 2021 and March 31, 2021 , our issued and outstanding SVS and MVS shares amounted to 703,260,526 and 686,409,852 shares, respectively.

 

  Non-IFRS   Financial and Performance Measures  

 

In this press release Curaleaf refers to certain non-IFRS financial measures such as "Gross Profit on Cannabis Sales" and "Adjusted EBITDA". These measures do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other issuers. The Company defines "Gross Profit on Cannabis Sales" as retail and wholesale revenues less cost of goods sold. "Adjusted EBITDA" is defined by Curaleaf as earnings before interest, taxes, depreciation and amortization less share-based compensation expense and one-time charges related to business development, acquisition, financing and reorganization costs. Curaleaf considers these measures to be an important indicator of the financial strength and performance of our business. We believe the adjusted results presented provide relevant and useful information for investors because they clarify our actual operating performance, make it easier to compare our results with those of other companies and allow investors to review performance in the same way as our management. Since these measures are not calculated in accordance with IFRS, they should not be considered in isolation of, or as a substitute for, our reported results as indicators of our performance, and they may not be comparable to similarly named measures from other companies. The following tables provide a reconciliation of each of the non-IFRS measures to its closest IFRS measure.

 
 
                                                                                                                                                                                                                                                                                                                                                                                                                                            
 

   Consolidated Statements of Financial Position   

 

   ($ thousands)   

 
 
 
 
 
 

   June 30,   

 
 
 

   December 31,   

 
 
 
 
 

   2021   

 
 
 

   2020   

 
 
 
 
 

 

 

   Unaudited   

 
 
 

 

 

   Audited   

 
 

   Assets   

 
 
 
 
 
 
 
 
 

  Current assets:  

 
 
 
 
 
 
 
 
 

  Cash  

 
 
 
 

  $  

 
 

  333,791  

 
 
 

  $  

 
 

  73,542  

 
 

  Accounts receivable  

 
 
 
 
 

  49,672  

 
 
 
 

  28,830  

 
 

  Inventory, net  

 
 
 
 
 

  304,648  

 
 
 
 

  197,991  

 
 

  Biological assets  

 
 
 
 
 

  64,263  

 
 
 
 

  46,210  

 
 

  Assets held for sale  

 
 
 
 
 

  31,877  

 
 
 
 

  58,504  

 
 

  Prepaid expenses and other current assets  

 
 
 
 
 

  21,282  

 
 
 
 

  10,140  

 
 

  Current portion of notes receivable  

 
 
 
 
 

  

 
 
 
 

  2,645  

 
 

  Total current assets  

 
 
 
 
 

  805,533  

 
 
 
 

  417,862  

 
 

  Deferred tax asset  

 
 
 
 
 

  6,266  

 
 
 
 

  5,528  

 
 

  Notes receivable  

 
 
 
 
 

  2,602  

 
 
 
 

  2,000  

 
 

  Property, plant and equipment, net  

 
 
 
 
 

  306,573  

 
 
 
 

  242,855  

 
 

  Right-of-use assets, net  

 
 
 
 
 

  285,549  

 
 
 
 

  267,168  

 
 

  Intangible assets, net  

 
 
 
 
 

  1,116,716  

 
 
 
 

  797,401  

 
 

  Goodwill  

 
 
 
 
 

  583,250  

 
 
 
 

  470,144  

 
 

  Investments  

 
 
 
 
 

  23,493  

 
 
 
 

  16,264  

 
 

  Prepaid acquisition consideration  

 
 
 
 
 

  

 
 
 
 

  132,234  

 
 

  Other assets  

 
 
 
 
 

  24,711  

 
 
 
 

  35,135  

 
 

  Total assets  

 
 
 
 

  $  

 
 

  3,154,693  

 
 
 

  $  

 
 

  2,386,591  

 
 
 
 
 
 
 
 
 
 

   Liabilities and Shareholders' Equity   

 
 
 
 
 
 
 
 
 

  Current liabilities:  

 
 
 
 
 
 
 
 
 

  Accounts payable  

 
 
 
 

  $  

 
 

  42,957  

 
 
 

  $  

 
 

  47,043  

 
 

  Accrued expenses  

 
 
 
 
 

  59,672  

 
 
 
 

  57,475  

 
 

  Income tax payable  

 
 
 
 
 

  63,384  

 
 
 
 

  79,649  

 
 

  Current portion of lease liability  

 
 
 
 
 

  18,312  

 
 
 
 

  15,710  

 
 

  Current portion of notes payable  

 
 
 
 
 

  1,706  

 
 
 
 

  6,500  

 
 

  Current contingent consideration liability  

 
 
 
 
 

  9,155  

 
 
 
 

  

 
 

  Liabilities held for sale  

 
 
 
 
 

  7,077  

 
 
 
 

  7,181  

 
 

  Other current liabilities  

 
 
 
 
 

  13,083  

 
 
 
 

  6,568  

 
 

  Total current liabilities  

 
 
 
 
 

  215,346  

 
 
 
 

  220,126  

 
 

  Deferred tax liability  

 
 
 
 
 

  340,358  

 
 
 
 

  226,465  

 
 

  Notes payable  

 
 
 
 
 

  336,452  

 
 
 
 

  285,001  

 
 

  Lease Liabilities  

 
 
 
 
 

  293,190  

 
 
 
 

  270,495  

 
 

  Non-controlling interest redemption liability  

 
 
 
 
 

  129,066  

 
 
 
 

  2,694  

 
 

  Contingent consideration liability  

 
 
 
 
 

  29,106  

 
 
 
 

  1,898  

 
 

  Other long term liability  

 
 
 
 
 

  4,098  

 
 
 
 

  3,698  

 
 

  Total liabilities  

 
 
 
 
 

  1,347,616  

 
 
 
 

  1,010,377  

 
 
 
 
 
 
 
 
 
 

  Shareholders' equity:  

 
 
 
 
 
 
 
 
 

  Share capital  

 
 
 
 
 

  2,267,167  

 
 
 
 

  1,754,412  

 
 

  Treasury shares  

 
 
 
 
 

  (5,208)  

 
 
 
 

  (5,208)  

 
 

  Reserves  

 
 
 
 
 

  (239,265)  

 
 
 
 

  (177,744)  

 
 

  Accumulated other comprehensive income (deficit)  

 
 
 
 
 

  2,180  

 
 
 
 

  

 
 

  Accumulated deficit  

 
 
 
 
 

  (219,098)  

 
 
 
 

  (194,645)  

 
 

  Total Curaleaf Holdings, Inc. shareholders' equity  

 
 
 
 
 

  1,805,776  

 
 
 
 

  1,376,815  

 
 

  Redeemable non-controlling interest  

 
 
 
 
 

  (129,066)  

 
 
 
 

  (2,694)  

 
 

  Non-controlling interest  

 
 
 
 
 

  130,367  

 
 
 
 

  2,093  

 
 

  Total shareholders' equity  

 
 
 
 
 

  1,807,077  

 
 
 
 

  1,376,214  

 
 

  Total liabilities and shareholders' equity  

 
 
 
 

  $  

 
 

  3,154,693  

 
 
 

  $  

 
 

  2,386,591  

 
 
 

 

 
 
                                                                                                                                                                                                                      
 

   Consolidated Statements of Profits and Losses   

 

   ($ thousands, except for share and per share amounts)   

 
 
 
 
 

   Three Months Ended   

 
 
 
 

   June, 30   

 
 
 
 

   2021   

 
 
 

   2020   

 
 
 
 

 

 

   Unaudited   

 
 
 

 

 

   Unaudited   

 
 

  Revenue:  

 
 
 
 
 
 
 
 

  Retail and wholesale revenue  

 
 
 

  $  

 
 

  311,494  

 
 
 

  $  

 
 

  99,579  

 
 

  Management fee income  

 
 
 
 

  711  

 
 
 
 

  17,901  

 
 

  Total revenue  

 
 
 
 

  312,205  

 
 
 
 

  117,480  

 
 

  Cost of goods sold  

 
 
 
 

  156,967  

 
 
 
 

  56,844  

 
 

  Gross profit before impact of biological assets  

 
 
 
 

  155,238  

 
 
 
 

  60,636  

 
 

  Realized fair value amounts included in inventory sold  

 
 
 
 

  (81,803)  

 
 
 
 

  (22,423)  

 
 

  Unrealized fair value gain on growth of biological assets  

 
 
 
 

  111,060  

 
 
 
 

  43,014  

 
 

  Gross profit  

 
 
 
 

  184,495  

 
 
 
 

  81,227  

 
 

  Operating expenses:  

 
 
 
 
 
 
 
 

  Selling, general and administrative  

 
 
 
 

  87,959  

 
 
 
 

  40,466  

 
 

  Share-based compensation  

 
 
 
 

  18,370  

 
 
 
 

  4,833  

 
 

  Depreciation and amortization  

 
 
 
 

  26,280  

 
 
 
 

  14,237  

 
 

  Total operating expenses  

 
 
 
 

  132,609  

 
 
 
 

  59,536  

 
 

  Income (Loss) from operations  

 
 
 
 

  51,886  

 
 
 
 

  21,691  

 
 

  Other income (expense):  

 
 
 
 
 
 
 
 

  Interest income  

 
 
 
 

  278  

 
 
 
 

  3,573  

 
 

  Interest expense  

 
 
 
 

  (12,269)  

 
 
 
 

  (11,357)  

 
 

  Interest expense related to lease liabilities  

 
 
 
 

  (9,339)  

 
 
 
 

  (2,132)  

 
 

  Other income (expense)  

 
 
 
 

  2,304  

 
 
 
 

  (77)  

 
 

  Total other income (expense), net  

 
 
 
 

  (19,026)  

 
 
 
 

  (9,993)  

 
 

  Income (Loss) before provision for income taxes  

 
 
 
 

  32,860  

 
 
 
 

  11,698  

 
 

  Income tax benefit (expense)  

 
 
 
 

  (42,624)  

 
 
 
 

  (13,534)  

 
 

  Net loss  

 
 
 
 

  (9,764)  

 
 
 
 

  (1,836)  

 
 

  Less: Net income (loss) attributable to non-controlling interest  

 
 
 
 

  (2,524)  

 
 
 
 

  193  

 
 

  Net loss attributable to Curaleaf Holdings, Inc.  

 
 
 

  $  

 
 

  (7,240)  

 
 
 

  $  

 
 

  (2,029)  

 
 

  Loss per share attributable to Curaleaf Holdings, Inc. – basic and diluted  

 
 
 

  $  

 
 

  (0.01)  

 
 
 

  $  

 
 

  (0.00)  

 
 

  Weighted average common shares outstanding – basic and diluted  

 
 
 
 

  701,668,932  

 
 
 
 

  533,192,806  

 
 
 

 

 

 

 
 
                                                                                                                                                                                                                      
 

   Consolidated Statements of Profits and Losses   

 

   ($ thousands, except for share and per share amounts)   

 
 
 
 
 

   Six Months Ended   

 
 
 
 

   June, 30   

 
 
 
 

   2021   

 
 
 

   2020   

 
 
 
 

 

 

   Unaudited   

 
 
 

 

 

   Unaudited   

 
 

  Revenue:  

 
 
 
 
 
 
 
 

  Retail and wholesale revenue  

 
 
 

  $  

 
 

  571,377  

 
 
 

  $  

 
 

  176,635  

 
 

  Management fee income  

 
 
 
 

  1,148  

 
 
 
 

  37,342  

 
 

  Total revenue  

 
 
 
 

  572,525  

 
 
 
 

  213,977  

 
 

  Cost of goods sold  

 
 
 
 

  288,820  

 
 
 
 

  100,856  

 
 

  Gross profit before impact of biological assets  

 
 
 
 

  283,705  

 
 
 
 

  113,121  

 
 

  Realized fair value amounts included in inventory sold  

 
 
 
 

  (150,717)  

 
 
 
 

  (43,613)  

 
 

  Unrealized fair value gain on growth of biological assets  

 
 
 
 

  192,321  

 
 
 
 

  79,761  

 
 

  Gross profit  

 
 
 
 

  325,309  

 
 
 
 

  149,269  

 
 

  Operating expenses:  

 
 
 
 
 
 
 
 

  Selling, general and administrative  

 
 
 
 

  168,052  

 
 
 
 

  86,324  

 
 

  Share-based compensation  

 
 
 
 

  23,277  

 
 
 
 

  9,334  

 
 

  Depreciation and amortization  

 
 
 
 

  48,392  

 
 
 
 

  26,924  

 
 

  Total operating expenses  

 
 
 
 

  239,721  

 
 
 
 

  122,582  

 
 

  Income (Loss) from operations  

 
 
 
 

  85,588  

 
 
 
 

  26,687  

 
 

  Other income (expense):  

 
 
 
 
 
 
 
 

  Interest income  

 
 
 
 

  366  

 
 
 
 

  6,419  

 
 

  Interest expense  

 
 
 
 

  (24,420)  

 
 
 
 

  (21,849)  

 
 

  Interest expense related to lease liabilities  

 
 
 
 

  (17,899)  

 
 
 
 

  (4,290)  

 
 

  Other income (expense)  

 
 
 
 

  2,719  

 
 
 
 

  2,529  

 
 

  Total other income (expense), net  

 
 
 
 

  (39,234)  

 
 
 
 

  (17,191)  

 
 

  Income (Loss) before provision for income taxes  

 
 
 
 

  46,354  

 
 
 
 

  9,496  

 
 

  Income tax benefit (expense)  

 
 
 
 

  (73,332)  

 
 
 
 

  (26,783)  

 
 

  Net loss  

 
 
 
 

  (26,978)  

 
 
 
 

  (17,287)  

 
 

  Less: Net income (loss) attributable to non-controlling interest  

 
 
 
 

  (2,524)  

 
 
 
 

  (170)  

 
 

  Net loss attributable to Curaleaf Holdings, Inc.  

 
 
 

  $  

 
 

  (24,454)  

 
 
 

  $  

 
 

  (17,117)  

 
 

  Loss per share attributable to Curaleaf Holdings, Inc. – basic and diluted  

 
 
 

  $  

 
 

  (0.04)  

 
 
 

  $  

 
 

  (0.03)  

 
 

  Weighted average common shares outstanding – basic and diluted  

 
 
 
 

  691,909,375  

 
 
 
 

  520,446,921  

 
 
 

 

 
 
                                                                                                                                                                                                                                                                                                                 
 

   Consolidated Statements of Cash Flows   

 

   ($ thousands, except for share and per share amounts)   

 
 
 
 
 

   Six Months Ended   

 
 
 
 

   June, 31   

 
 
 
 

   2021   

 
 
 

   2020   

 
 
 
 

 

 

   Unaudited   

 
 
 

 

 

   Unaudited   

 
 

   Cash flows from operating activities:   

 
 
 
 
 
 
 
 

  Net loss  

 
 
 

  $  

 
 

  (26,978)  

 
 
 
 

  (17,287)  

 
 

  Adjustments to reconcile loss to net cash provided (used) in operating activities:  

 
 
 
 
 
 
 
 

  Depreciation and amortization  

 
 
 
 

  65,037  

 
 
 
 

  34,983  

 
 

  Share-based compensation  

 
 
 
 

  23,277  

 
 
 
 

  10,852  

 
 

  Non-cash interest expense  

 
 
 
 

  19,477  

 
 
 
 

  5,633  

 
 

  Unrealized gain on changes in fair value of biological assets  

 
 
 
 

  (192,349)  

 
 
 
 

  (79,761)  

 
 

  Realized fair value amounts included in inventory sold  

 
 
 
 

  150,717  

 
 
 
 

  43,613  

 
 

  (Gain)/loss on sale of property, plant and equipment  

 
 
 
 

  (740)  

 
 
 
 

  

 
 

  Deferred taxes  

 
 
 
 

  8,250  

 
 
 
 

  6,503  

 
 

  Accounts receivable  

 
 
 
 

  (12,046)  

 
 
 
 

  8,522  

 
 

  Biological assets  

 
 
 
 

  29,294  

 
 
 
 

  26,852  

 
 

  Inventories  

 
 
 
 

  (100,800)  

 
 
 
 

  (46,197)  

 
 

  Prepaid expenses and other current assets  

 
 
 
 

  (13,240)  

 
 
 
 

  1,299  

 
 

  Other assets  

 
 
 
 

  (1,137)  

 
 
 
 

  (1,442)  

 
 

  Accounts payable  

 
 
 
 

  (4,516)  

 
 
 
 

  4,614  

 
 

  Income taxes payable  

 
 
 
 

  (15,377)  

 
 
 
 

  21,803  

 
 

  Accrued expenses  

 
 
 
 

  (7,996)  

 
 
 
 

  1,827  

 
 

  Net cash provided by (used in) operating activities  

 
 
 
 

  (79,127)  

 
 
 
 

  21,814  

 
 

   Cash flows from investing activities:   

 
 
 
 
 
 
 
 

  Purchases of property, plant and equipment, net  

 
 
 
 

  (73,342)  

 
 
 
 

  (51,511)  

 
 

  Proceeds from sale of entity  

 
 
 
 

  24,884  

 
 
 
 

  

 
 

  Payments made on completion on acquisitions  

 
 
 
 

  

 
 
 
 

  (51,188)  

 
 

  Cash acquired from acquisitions  

 
 
 
 

  12,891  

 
 
 
 

  

 
 

  Amounts advanced for notes receivable, net of payments received  

 
 
 
 

  2,038  

 
 
 
 

  (14,100)  

 
 

  Net cash used in investing activities  

 
 
 
 

  (33,529)  

 
 
 
 

  (116,799)  

 
 

   Cash flows from financing activities:   

 
 
 
 
 
 
 
 

   Proceeds from senior unsecured notes   

 
 
 
 
 
 
 
 

  Cash received from financing agreement  

 
 
 
 

  54,599  

 
 
 
 

  185,723  

 
 

  Proceeds from sale leaseback  

 
 
 
 

  19,947  

 
 
 
 

  

 
 

  Debt issuance costs  

 
 
 
 

  (681)  

 
 
 
 

  

 
 

  Lease liability payments  

 
 
 
 

  (25,130)  

 
 
 
 

  (11,164)  

 
 

  Proceeds from minority interest investment in Curaleaf International  

 
 
 
 

  86,957  

 
 
 
 

  

 
 

  Principal payments on notes payable  

 
 
 
 

  (6,093)  

 
 
 
 

  

 
 

  Exercise of stock options  

 
 
 
 

  2,667  

 
 
 
 

  879  

 
 

  Issuance of common shares, net of issuance costs  

 
 
 
 

  240,569  

 
 
 
 

  

 
 

  Net cash provided by financing activities  

 
 
 
 

  372,835  

 
 
 
 

  175,438  

 
 

   Net change in cash   

 
 
 
 

  260,179  

 
 
 
 

  80,453  

 
 

  Cash at beginning of period  

 
 
 
 

  73,542  

 
 
 
 

  42,310  

 
 

  Effect of exchange rate on cash  

 
 
 
 

  70  

 
 
 
 

  

 
 

  Cash at end of period  

 
 
 

  $  

 
 

  333,791  

 
 
 

  $  

 
 

  122,763  

 
 
 

  About Curaleaf Holdings
Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) ("Curaleaf") is a leading international provider of consumer products in cannabis with a mission to improve lives by providing clarity around cannabis and confidence around consumption. As a high-growth cannabis company known for quality, expertise and reliability, the Company and its brands, including Curaleaf and Select, provide industry-leading service, product selection and accessibility across the medical and adult-use markets. In the United States , Curaleaf currently operates in 23 states with 108 dispensaries, 22 cultivation sites and over 30 processing sites, and employs over 5,000 team members. Curaleaf International is the largest vertically integrated cannabis company in Europe with a unique supply and distribution network throughout the European market, bringing together pioneering science and research with cutting-edge cultivation, extraction and production. Curaleaf is listed on the Canadian Securities Exchange under the symbol CURA and trades on the OTCQX market under the symbol CURLF. For more information, please visit https://ir.curaleaf.com .

 
 
                                
 

   Curaleaf IR Twitter Account   

 
 

   https://twitter.com/Curaleaf_IR   

 
 
 
 

   Investor Toolkit   

 
 

   https://ir.curaleaf.com/investor-toolkit   

 
 
 
 

   Investor Relations Website   

 
 

   https://ir.curaleaf.com/   

 
 
 
 

   Contact Information   

 
 
 
 

   Investor Contact:   

 
 
 

  Curaleaf Holdings, Inc.  

 
 
 

  Carlos Madrazo, SVP Head of IR & Capital Markets  

 
 
 

   ir@curaleaf.com   

 
 
 
 
 

   Media Contact:   

 
 
 

  Curaleaf Holdings, Inc.  

 
 
 

  Tracy Brady, VP of Corporate Communications  

 
 
 

   media@curaleaf.com   

 
 
 

  Disclaimer  

 

This press release contains "forward-looking information" and "forward-looking statements" within the meaning of Canadian securities laws and United States securities laws ("forward-looking statements"). Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based on management's current beliefs, expectations or assumptions regarding the future of the business, plans and strategies, operational results and other future conditions of the Company. In addition, the Company may make or approve certain statements in future filings with Canadian securities regulatory authorities, in press releases, or in oral or written presentations by representatives of the Company that are not statements of historical fact and may also constitute forward-looking statements. All statements, other than statements of historical fact, made by the Company that address activities, events or developments that the Company expects or anticipates will or may occur in the future are forward-looking statements, including, but not limited to, statements preceded by, followed by or that include words such as "assumptions", "assumes", "guidance", "outlook", "may", "will", "would", "could", "should", "believes", "estimates", "projects", "potential", "expects", "plans", "intends", "anticipates", "targeted", "continues", "forecasts", "designed", "goal", or the negative of those words or other similar or comparable words and includes, among others, information regarding: its outlook for and expected operating margins, capital allocation, free flow cash and other financial results; growth of its operations via expansion, for the effects of any transactions; expectations for the potential benefits of any transactions; statements relating to the business and future activities of, and developments related to, the Company after the date of this press release, including such things as future business strategy, competitive strengths, goals, expansion and growth of the Company's business, operations and plans; expectations that planned acquisitions will be completed; expectations regarding cultivation and manufacturing capacity; expectations regarding receipt of regulatory approvals; expectations that licenses applied for will be obtained; potential future legalization of adult-use and/or medical cannabis under U.S. federal law; expectations of market size and growth in the U.S. and the states in which the Company operates; expectations for other economic, business, regulatory and/or competitive factors related to the Company or the cannabis industry generally; and other events or conditions that may occur in the future. Forward-looking statements may relate to future financial conditions, results of operations, plans, objectives, performance or business developments. These statements speak only as at the date they are made and are based on information currently available and on the then current expectations. Holders of securities of the Company are cautioned that forward-looking statements are not based on historical facts but instead are based on reasonable assumptions and estimates of management of the Company at the time they were provided or made and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, as applicable, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements, including, but not limited to, risks and uncertainties related to: the available funds of the Company and the anticipated use of such funds; the availability of financing opportunities; legal and regulatory risks inherent in the cannabis industry; risks associated with economic conditions, dependence on management and currency risk; risks relating to U.S. regulatory landscape and enforcement related to cannabis, including political risks; risks relating to anti-money laundering laws and regulation; other governmental and environmental regulation; public opinion and perception of the cannabis industry; risks related to contracts with third-party service providers; risks related to the enforceability of contracts; reliance on the expertise and judgment of senior management of the Company, and ability to retain such senior management; risks related to proprietary intellectual property and potential infringement by third-parties; the concentrated voting control of the Company's Chairman and the unpredictability caused by the capital structure; risks relating to the management of growth; increasing competition in the industry; risks inherent in an agricultural business; risks relating to energy costs; risks associated to cannabis products manufactured for human consumption including potential product recalls; reliance on key inputs, suppliers and skilled labor; cybersecurity risks; ability and constraints on marketing products; fraudulent activity by employees, contractors and consultants; tax and insurance related risks; risks related to the economy generally; risk of litigation; conflicts of interest; risks relating to certain remedies being limited and the difficulty of enforcement of judgments and effect service outside of Canada ; risks related to future acquisitions or dispositions; sales by existing shareholders; limited research and data relating to cannabis; as well as those risk factors discussed under "Risk Factors" in the Company's Annual Management, Discussion and Analysis dated March 11, 2021 , and in the Company's Annual Information Form dated April 28, 2021 , and as described from time to time in documents filed by the Company with Canadian securities regulatory authorities. The purpose of forward-looking statements is to provide the reader with a description of management's expectations, and such forward-looking statements may not be appropriate for any other purpose. In particular, but without limiting the foregoing, disclosure in this press release as well as statements regarding the Company's objectives, plans and goals, including future operating results and economic performance may make reference to or involve forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. A number of factors could cause actual events, performance or results to differ materially from what is projected in the forward-looking statements. You should not place undue reliance on forward-looking statements contained in this press release. Such forward-looking statements are made as of the date of this press release. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement.

 

This news release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about the Company's prospective results of operations, production and production efficiency, commercialization, revenue and cash on hand, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set second in the above paragraph. FOFI contained in this document was approved by management as of the date of this document and was provided for the purpose of providing further information about the Company's future business operations. The Company disclaims any intention or obligation to update or revise any FOFI contained in this document, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. The financial information reported in this news release is based on unaudited management prepared financial statements for the quarter ended June 30, 2021 . Accordingly, such financial information may be subject to change. Financial statements for the period will be released and filed under the Company's profiles on SEDAR at www.sedar.com no later than August 12, 2021 . All financial information contained in this news release is qualified in its entirety with reference to such unaudited financial statements. While the Company does not expect there to be any material changes, to the extent that the financial information contained in this news release is inconsistent with the information contained in the Company's unaudited financial statements, the financial information contained in this news release shall be deemed to be modified or superseded by the Company's unaudited financial statements. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation for purposes of applicable securities laws.

 

Neither the Canadian Securities Exchange nor its Regulation Service Provider has reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.

 

 Cision View original content: https://www.prnewswire.com/news-releases/curaleaf-reports-record-second-quarter-2021-results-301351384.html  

 

SOURCE Curaleaf Holdings, Inc.

 
 

News Provided by PR Newswire via QuoteMedia

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Consumption habits are changing as edibles, vaping and THC beverages gain traction, especially among younger users, and cannabis companies are adapting their offerings to meet shifting demand.

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Consumption methods evolving post-legalization

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While smoking remains the dominant method of cannabis consumption, a recent report from the Centers for Disease Control and Prevention highlights the growing popularity of edibles, vaping and dabbing.

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A separate study published by the American Medical Association and funded in part by the Canadian Institutes of Health Research also points to how product preferences have changed among Canadian users since legalization in 2018.


The study indicates that while the use of flower, cannabis concentrates, oil, tinctures and topicals has decreased during that time, the use of vape cartridges, edibles and beverages has increased.

Edibles and beverages were legalized in Canada in late 2019, and Truss Beverage was one of the first players to introduce cannabis-infused drinks. Truss was a joint venture formed by Molson Coors Canada (TSX:TPX.A,TSX:TPX.B) and HEXO, a cannabis company that has since been acquired by Tilray Brands (TSX:TLRY,NASDAQ:TLRY).

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A 2023 Gallup poll reveals a two decade decline in alcohol consumption, particularly among younger adults, suggesting a shift towards more health-conscious lifestyles within this demographic.

Craft beer production declined by 4 percent year-on-year in 2024, according to data collected by the Brewers Association. This marked the largest drop in the industry's history, excluding the pandemic. For small, independent craft breweries, 2024 marked the third consecutive year of declining production. A drop in the number of operating small breweries last year provides further evidence of this trend, with 501 closures in 2024 versus 434 openings.

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Hemp market growth despite regulatory uncertainty

The burgeoning hemp industry is another segment of the expanding cannabis market.

The legalization of industrial hemp — defined as cannabis with a THC concentration of 0.3 percent or less — through the 2018 Farm Bill led to initial investment and optimistic projections for CBD wellness products and various industrial applications. The sector’s rapid evolution also brought the rise of hemp-derived intoxicating cannabinoids, creating a market that presented both opportunities and complexities for participants.

However, after an initial boom, a lack of infrastructure and clearly defined regulations for CBD, as well as state-level variations and market oversupply, ultimately contributed to a quick retraction.

2024 was a pivotal year for the US hemp industry, as the hemp-related provisions of the 2018 Farm Bill — originally set to expire in September 2023, but extended to December 31, 2024 — created an urgent need to address critical issues like THC limits and the regulation of novel hemp-derived cannabinoids. A major point of contention was the proposed shift from defining hemp based on Delta-9 THC concentration (0.3 percent or less) to “total THC,” which includes THCA.

This change had the potential to significantly impact farmers and processors, as many hemp varieties that are compliant under the Delta-9 THC rule could exceed the 0.3 percent limit when THCA is included.

Various bills and amendments were proposed in 2024 as part of the Farm Bill discussions, each with different approaches to regulating hemp. Separate regulatory frameworks for industrial hemp and hemp grown for cannabinoids were suggested, and many states took their own action, leading to a patchwork of regulations and even outright bans.

Despite challenges, data from the US Department of Agriculture suggests signs of recovery.

The department's annual National Hemp Report from 2024 points to an 18 percent increase in industrial hemp production value between 2022 and 2023, with output growth seen in specific sectors like floral (18 percent), fiber (133 percent) and seed hemp (414 percent). The 2025 report from the Department of Agriculture indicates further expansion, with notable increases observed in both acreage (up 64 percent from 2023) and value (46 percent).

The 2024 Farm Bill ultimately did not pass, and right now the hemp industry is operating under a temporary extension of the 2018 Farm Bill under the American Relief Act of 2025, signed into law on December 21, 2024.

The 2018 Farm Bill is now set to expire on September 30, 2025.

While analysts for Markets and Markets project that the North American hemp industry will grow at a CAGR of 22.4 percent and ultimately reach a valuation of US$30.24 billion by 2029, the future of the industry will be heavily influenced by the outcome of the ongoing Farm Bill discussions.

US cannabis legalization remains stalled

Although there is clear demand for cannabis products, the now-defunct rescheduling process in the US is likely to continue casting a shadow of uncertainty over the industry's long-term trajectory.

Legal and procedural delays, including allegations of improper conduct and bias within the US Drug Enforcement Administration (DEA), led to hearing cancellations, and the new administration of US President Donald Trump has brought leadership changes to key agencies like the DEA and the Department of Justice.

Terry Cole, who Trump nominated to be DEA administrator on February 11, has a history of opposing cannabis legalization in the country. Similarly, Pam Bondi, Trump’s pick to lead the justice department, staunchly opposed a movement to legalize medical cannabis during her tenure as Florida’s attorney general.

While there have been bipartisan efforts in Congress to end federal cannabis prohibition and establish regulations for eventual legalization, the DEA’s actions and statements indicate a potential stall or reversal of progress.

In addition to that, new research is adding complexity to the debate.

A study published in the American Journal of Psychiatry this past March highlights an association between the use of high-potency cannabis strains and increased risks of psychosis, a factor that may not have been fully considered by the Department of Health and Human Services. As stronger cannabis strains become more widely available, a reassessment of their potential health risks may be required.

Investor takeaway

While the cannabis industry holds promise for growth and innovation, investors must remain acutely aware of the regulatory uncertainties and market volatility that will undoubtedly shape its trajectory in the years to come.

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Meagen Seatter, hold no direct investment interest in any company mentioned in this article.

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