TerrAscend Reports First Quarter Net Sales of USD $53.4 Million and Adjusted EBITDA of USD $22.6 Million

 
 

  -- Raises full year 2021 guidance for Net Sales to exceed USD $300 million and Adjusted EBITDA to exceed USD $128 million   2  

 

  -- Substantial cash balance of USD $234 million provides ample support for future growth initiatives  

 

TerrAscend Corp. ("TerrAscend" or the "Company") (CSE: TER) (OTCQX: TRSSF), a leading North American cannabis operator, today reported financial results for its first quarter ending March 31 2021.

 

  First Quarter 2021 Financial Highlights
( Unless otherwise stated, all results are in U.S. dollars)    2  

 
  •   Net Sales increased 106% to $53.4 million compared to $25.9 million in Q1 2020.
  •  
  •   Adjusted Gross Profit   Margin   3 increased to 65% compared to 45% in Q1 2020.
  •  
  •   Adjusted EBITDA increased more than five-fold to $22.6 million compared to $3.7 million in Q1 2020.
  •  
  •   Adjusted EBITDA   Margin   1 was 42% compared to 14% in Q1 2020.
  •  
  •   Cash Flow From Operations was $13.3 million compared to a loss of $0.8 million in Q1 2020.
  •  
  •   Cash balance of $234 million at quarter end to support future growth initiatives.
  •  

  Management Commentary  

 

"In Q1, we drove strong revenue growth, margin expansion and cash generation by continued focus on operational excellence, disciplined cost control and effective allocation of capital," said Jason Wild , Executive Chairman of TerrAscend. "I'm pleased with the strong results our team has delivered to begin the year."

 

Mr. Wild added, "Looking ahead to the rest of the year, there are strong operational tailwinds helping our business as we continue to see the benefits from recently completed cultivation expansions, and the addition of retail locations in New Jersey , Pennsylvania and Maryland ."

 

  First Quarter 2021 Operational Highlights  

 
  • Completed 80,000 square foot indoor cultivation and manufacturing facility in New Jersey
  •  
  • Received permit allowing for extraction, processing, and manufacturing in New Jersey
  •  
  • Raised $175 million in an oversubscribed non-brokered private placement in January 2021
  •  
  • Agreed to settlement and termination of offtake agreement with PharmHouse for an immaterial amount
  •  

  Subsequent Events  

 
  • Announced and completed Pennsylvania dispensary acquisition of Keystone Canna Remedies ('KCR')
  •  
  • Completed Maryland grower processor acquisition of HMS Health
  •  
  • Opened largest Apothecarium dispensary on East Coast in Maplewood, New Jersey
  •  

  Financial Summary of Q1 2021 and Comparative Periods  

 
 
                                                    
 

   (In millions of U.S. Dollars)   

 
 

   Q1   

 

   2021   

 
 

  Q4  

 

  2020  

 
 

  Q1  

 

  2020  

 
 

  Net Sales  

 
 

   53.4   

 
 

  49.6  

 
 

  25.9  

 
 

   QoQ increase   

 
 

    8%    

 
 

   30%   

 
 

   N/C   

 
 

   YoY increase   

 
 

    106%    

 
 

   154%   

 
 

   N/C   

 
 

  Gross profit before gain on fair value of biological assets  

 
 

   34.9   

 
 

  27.5  

 
 

  11.6  

 
 

  Adjusted Gross profit 3  

 
 

   34.9   

 
 

  29.7  

 
 

  11.6  

 
 

   % of Net Sales   

 
 

    65%    

 
 

   60%   

 
 

   45%   

 
 

  General & Administrative Expense  

 
 

   15.8   

 
 

  11.6  

 
 

  10.9  

 
 

   % of Net Sales   

 
 

    30%    

 
 

   23%   

 
 

   42%   

 
 

  Adjusted EBITDA  

 
 

   22.6   

 
 

  19.6  

 
 

  3.7  

 
 

   Adjusted EBITDA % of Net Sales   

 
 

    42%    

 
 

   40%   

 
 

   14%   

 
 

  Net income / (loss)  

 
 

   (12.7)   

 
 

  (87.8)  

 
 

  (10.3)  

 
 

  Cash Flow from Operations  

 
 

   13.3   

 
 

  18.6  

 
 

  (0.8)  

 
 
 
 
         
 
 
 

  1.  

 
 

  Adjusted EBITDA and the respective margin are Non-IFRS measures. Please see discussion and reconciliation of Non-IFRS measures below.  

 
 

  2.  

 
 

  Beginning in Q1 2021 the Company began reporting financial results in US dollars. Conversion of previous guidance in Canadian dollars uses an average CAD/USD FX rate of 1.26598 for Q1 2021, 1.34490 for Q1 2020 and 1.34150 for Q4 2020.  

 
 

  3.  

 
 

  Adjusted Gross profit and the respective margin are Non-IFRS measures and are calculated before the impact from biological assets. The 4Q 2020 result excludes $2.3 million of one-time non-cash inventory impairment in Canadian operations.  

 
 

  N/C – Not Comparable  

 
 
 

Net Sales increased 106% to $53.4 million in the first quarter of 2021, as compared to $25.9 million in the first quarter of 2020. This strong year over year growth was driven by cultivation capacity expansions in Pennsylvania , New Jersey , and California as well as five new dispensary openings during 2020. Net Sales increased 8% quarter-over-quarter driven by a full quarter of capacity expansion in Pennsylvania and the initial ramp up of the operations in New Jersey .

 

Adjusted gross margin, before gain on fair value of biological assets, was 65% in the first quarter of 2021 compared to 45% in the first quarter of 2020 and 60% in the fourth quarter of 2020. The 500 basis point improvement quarter-over-quarter in adjusted gross margin to 65% is due to greater mix of higher margin sales from Pennsylvania and the initial ramp of retail and wholesale operations in New Jersey.

 

G&A expense was $15.8 million , representing 30% of Net Sales in the first quarter of 2021, a decrease from 42% of Net Sales in the first quarter of 2020. Sequentially, G&A expense increased from 23% in the fourth quarter of 2020. Approximately half of the increase was related to one-time legal and severance costs while the remainder was related to planned investments in personnel, systems and other capabilities to enable future growth.

 

Adjusted EBITDA was $22.6 million in the first quarter of 2021 compared to $3.7 million in the first quarter of 2020.  Adjusted EBITDA margin in the first quarter of 2021 was 42% compared to 14% in the first quarter of 2020 and 40% in the fourth quarter of 2020.

 

Net loss for the first quarter of 2021 was $12.7 million , largely impacted by a loss on fair value of warrants of $5 million and an unrealized foreign exchange loss of $3 million , along with income tax expense of $10 million , financing, and other expenses of $7 million , share based compensation of $4 million and depreciation and amortization, inclusive of depreciation and amortization in cost of goods sold, of $4 million .

 

Cash and cash equivalents were $234 million as of March 31, 2021 , compared to $59 million as of December 31 , 2020 demonstrating the strong balance sheet position to support the Company's growth initiatives. The Company raised net proceeds of $173.4 million in January in an oversubscribed non-brokered private placement and received $9 million of proceeds from warrant and option exercises during the quarter.  Cash from operations was positive $13 million for the quarter while free cash flow, after $8 million of capex spending, was positive $5 million for the quarter. This is the second consecutive quarter in which the Company generated a positive free cash flow.

 

As of May 19, 2021 , there were 319 million shares outstanding on a fully diluted basis. Fully diluted shares outstanding include approximately 184 million common shares, 14 million common share equivalent preferred shares, 39 million exchangeable non-voting shares, and 82 million warrants and options. Basic shares outstanding on an as converted basis are approximately 237 million. The warrants and options had a weighted average strike price of C$4.90 on March 31, 2021 .

 

  2021 Outlook  

 

TerrAscend is raising full year guidance and expects Net Sales to exceed USD $300 million versus previous guidance of USD $290 million and Adjusted EBITDA to exceed USD $128 million versus previous guidance of USD $122 million .

 

In Pennsylvania , the Company will benefit from increased cultivation capacity completed in late 2020, as well as, the recent acquisition of KCR, which increased its dispensary footprint to six locations.

 

In New Jersey , sales from the Company's 40,000 square foot greenhouse and 80,000 square foot indoor cultivation facilities are expected to ramp up throughout 2021. TerrAscend's Phillipsburg, New Jersey dispensary achieved its first full quarter of sales in the first quarter of 2021, a second dispensary opened in Maplewood on May 7   th , and the Company plans to open a third dispensary later this summer.

 

In Maryland , the Company will benefit from the contribution of the recently acquired HMS Maryland business.

 

In California , the Company will benefit from a full quarter of sales from the recently expanded State Flower cultivation facility which has increased annual production capacity of super-premium craft flower by 500%. The Company's California retail footprint will benefit from the two Apothecarium locations in Berkeley and Capitola which opened in the second half of 2020. Both locations continue to ramp up and the overall business continues to recover from the easing of COVID restrictions in the state.

 

In Canada , the Company expects to see positive contributions to sales and profits with its newly streamlined product portfolio and optimized cost structure.

 

Finally, the Company remains on track to become a U.S. filer with the United States Securities and Exchange Commission (SEC) by the end of 2021 and is preparing to meet the requirements necessary for its securities to be traded on a national U.S. exchange should such an event become permissible by U.S. law.

 

  Conference Call  

 

TerrAscend will host a conference call today, May 19, 2021 , to discuss these results. Jason Wild , Executive Chairman, Keith Stauffer , Chief Financial Officer and Greg Rochlin , Chief Executive Officer of Northeast operations will host the call starting at 8:30 a.m. Eastern time . A question-and-answer session will follow management's presentation.

 
 
               
 

   CONFERENCE CALL DETAILS   

 
 
 
 

  DATE:  

 
 

  Wednesday, May 19 th , 2021  

 
 

  TIME:  

 
 

  8:30 a.m. Eastern Time  

 
 

  WEBCAST:  

 
 

   Click to Access   

 
 

  DIAL-IN NUMBER:  

 
 

  1-888-664-6392  

 
 

  CONFERENCE ID:  

 
 

  88025412  

 
 

  REPLAY:  

 

 

 
 

  (416) 764-8677 or (888) 390-0541
Available until 12:00 midnight Eastern Time Wednesday, June 2 nd , 2021
 

 

  Replay Code: 025412  

 
 
 

Financial results and analyses are available on the Company's website ( www.terrascend.com ) and SEDAR ( www.sedar.com ).

 

   The Canadian Securities Exchange ("CSE") has neither approved nor disapproved the contents of this news release. Neither the CSE nor its Market Regulator (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.   

 

  About TerrAscend  

 

TerrAscend is a leading North American cannabis operator with vertically integrated operations in Pennsylvania , New Jersey , and California , licensed cultivation and processing operations in Maryland and licensed production in Canada . TerrAscend operates an award-winning chain of The Apothecarium dispensary retail locations as well as scaled cultivation, processing, and manufacturing facilities on both the East and West coasts. TerrAscend's best-in-class cultivation and manufacturing practices yield consistent, high-quality cannabis, providing industry-leading product selection to both the medical and legal adult-use market. The Company owns several synergistic businesses and brands, including The Apothecarium, Ilera Healthcare, Kind Tree, Prism, State Flower, Valhalla Confections, and Arise Bioscience Inc. For more information, visit www.terrascend.com .

 

  Non-IFRS Measures, Reconciliation and Discussion  

 

Certain financial measures in this news release are non-IFRS measures, including, Adjusted Gross Profit and Adjusted EBITDA. These terms are not defined by IFRS and, therefore, may not be comparable to similar measures provided by other companies. These metrics have no direct comparable IFRS financial measure. Such information is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. For more information, please see "Non-IFRS Financial Measures" in the Company's Interim MD&A available on www.sedar.com .

 

Adjusted Gross Profit and the associated margin are non-IFRS measures which management uses to evaluate the performance of the Company's business as it reflects its ongoing profitability. The Company believes that certain investors and analysts use this measure to evaluate a company's ability to service debt and to meet other payment obligations or as a common measurement to value companies in certain industries. The Company measures Adjusted Gross Profit as Gross Profit / (loss) less the cost of a one-time inventory impairment at its Canadian operation in the fourth quarter of 2020. The associated margin is Adjusted Gross Profit as a percentage of Net Sales.

 

Adjusted EBITDA and the associated margin are non-IFRS measures which management uses to evaluate the performance of the Company's business as it reflects its ongoing profitability. The Company believes that certain investors and analysts use this measure to evaluate a company's ability to service debt and to meet other payment obligations or as a common measurement to value companies in certain industries. The Company measures Adjusted EBITDA as EBITDA less unrealized gain on changes in fair value of biological assets and other income plus fair value changes in biological assets included in inventory sold, impairments, restructuring costs, purchase accounting adjustments, transaction costs, share based compensation, revaluation of warrants and derivatives liabilities, unrealized loss on investments or foreign exchange, settlement costs related to contractual disputes, and other one-time non-recurring items. The associated margin is Adjusted EBITDA as a percentage of Net Sales.

 

  Caution Regarding Cannabis Operations in the United States   

 

Investors should note that there are significant legal restrictions and regulations that govern the cannabis industry in the United States . Cannabis remains a Schedule I drug under the US Controlled Substances Act, making it illegal under federal law in the United States to, among other things, cultivate, distribute, or possess cannabis in the United States . Financial transactions involving proceeds generated by, or intended to promote, cannabis-related business activities in the United States may form the basis for prosecution under applicable US federal money laundering legislation.

 

While the approach to enforcement of such laws by the federal government in the United States has trended toward non-enforcement against individuals and businesses that comply with medical or adult-use cannabis programs in states where such programs are legal, strict compliance with state laws with respect to cannabis will neither absolve TerrAscend of liability under US federal law, nor will it provide a defense to any federal proceeding which may be brought against TerrAscend. The enforcement of federal laws in the United States is a significant risk to the business of TerrAscend and any proceedings brought against TerrAscend thereunder may adversely affect TerrAscend's operations and financial performance.

 

  Forward Looking Information  

 

This news release contains "forward-looking information" within the meaning of applicable securities laws. Forward-looking information contained in this press release may be identified by the use of words such as, "may", "would", "could", "will", "likely", "expect", "anticipate", "believe, "intend", "plan", "forecast", "project", "estimate", "outlook" and other similar expressions, and include statements with respect to future revenue and profits. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management in light of management's experience and perception of trends, current conditions and expected developments, as well as other factors relevant in the circumstances, including assumptions in respect of current and future market conditions, the current and future regulatory environment, and the availability of licenses, approvals and permits.

 

Although the Company believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because the Company can give no assurance that they will prove to be correct. Actual results and developments may differ materially from those contemplated by these statements. Forward-looking information is subject to a variety of risks and uncertainties that could cause actual events or results to differ materially from those projected in the forward-looking information. Such risks and uncertainties include, but are not limited to, current and future market conditions; risks related to federal, state, provincial, territorial, local and foreign government laws, rules and regulations, including federal and state laws in the United States relating to cannabis operations in the United States ; and the risk factors set out in the Company's most recently filed MD&A, filed with the Canadian securities regulators and available under the Company's profile on SEDAR at www.sedar.com .

 

The statements in this press release are made as of the date of this release. The Company disclaims any intent or obligation to update any forward-looking information, whether, as a result of new information, future events, or results or otherwise, other than as required by applicable securities laws.

 

  Financial Outlook  

 

This press release contains a "financial outlook" within the meaning of applicable Canadian securities laws. The financial outlook has been prepared by management of TerrAscend to provide an outlook for full year 2021 and may not be appropriate for any other purpose. The financial outlook has been prepared based on a number of assumptions including the assumptions discussed under the heading "Forward Looking Information" above and the following assumptions: revenue earned in existing retail stores is representative both of revenue that will continue to be earned by such retail stores, as well as of revenue earned in new retail stores; the Company's ability to capitalize on the New Jersey market being generally undersupplied and underdeveloped at the retail and consumer level; the Company's retail locations continuing to be favorably located to take advantage of commuter and other traffic across its footprint; the Company's estimates about the growth in demand for medical cannabis outstripping the aggregate supply in the marketplace in each of its key markets being accurate; the Company's ability to continue to have a diversified customer base and avoid dependence or concentration in any one customer or small group of customers; the Company's Canadian business successfully scaling up its operations to meet customer demand; and, the success of the Company in integrating acquired businesses into its organizational structure and operations, including achieving anticipated economies of scale and revenue projections in connection with such acquisitions. The actual results of the Company's operations for any period will likely vary from the amounts set forth in these projections and such variations may be material. TerrAscend and its management believe that the financial outlook has been prepared on a reasonable basis. However, because this information is highly subjective and subject to numerous risks, including the risks discussed under the heading "Forward Looking Information" above, it should not be relied on as necessarily indicative of future results. Except as required by applicable Canadian securities laws, TerrAscend undertakes no obligation to update the financial outlook. TerrAscend undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of TerrAscend, its securities, or financial or operating results (as applicable).

 

  Consolidated Statements of Financial Position (Unaudited) ($ thousands)  

 
 
                                                                                                                                                                                                                                                                                                                                                                                    
 
 
 

   At   

 
 
 

   At   

 
 
 

   At   

 
 
 
 

   March 31, 2021   

 
 
 

   December 31, 2020*   

 
 
 

   January 1, 2020*   

 
 

   Assets   

 
 
 
 
 
 
 
 

   Current Assets   

 
 
 
 
 
 
 
 

  Cash and cash equivalents  

 
 

   $   

 
 

   234,237   

 
 

  $  

 
 

  59,226  

 
 

  $  

 
 

  9,162  

 
 

  Restricted cash  

 
 
 

    

 
 
 

  

 
 
 

  

 
 

  Receivables, net of sales returns and allowances  

 
 
 

   10,391   

 
 
 

  10,876  

 
 
 

  5,869  

 
 

  Share subscriptions receivable  

 
 
 

   12   

 
 
 

  

 
 
 

  24,463  

 
 

  Note receivable  

 
 
 

    

 
 
 

  

 
 
 

  4,609  

 
 

  Investments  

 
 
 

    

 
 
 

  

 
 
 

  358  

 
 

  Biological assets  

 
 
 

   17,479   

 
 
 

  17,816  

 
 
 

  4,222  

 
 

  Inventory  

 
 
 

   41,220   

 
 
 

  34,696  

 
 
 

  15,723  

 
 

  Prepaid expenses and other assets  

 
 
 

   4,713   

 
 
 

  5,165  

 
 
 

  4,757  

 
 
 
 

   308,052   

 
 
 

  127,779  

 
 
 

  69,163  

 
 

   Non-Current Assets   

 
 
 
 
 
 
 
 

  Investment in associate  

 
 
 

   1,508   

 
 
 

  1,379  

 
 
 

  1,000  

 
 

  Property, plant and equipment  

 
 
 

   135,881   

 
 
 

  129,735  

 
 
 

  86,734  

 
 

  Intangible assets and goodwill  

 
 
 

   198,480   

 
 
 

  199,985  

 
 
 

  185,670  

 
 

  Indemnification asset  

 
 
 

   10,303   

 
 
 

  11,500  

 
 
 

  11,500  

 
 

  Prepaid expenses and other assets  

 
 
 

   8,852   

 
 
 

  3,923  

 
 
 

  695  

 
 
 
 

   355,024   

 
 
 

  346,522  

 
 
 

  285,599  

 
 

   Total Assets   

 
 

   $   

 
 

   663,076   

 
 

  $  

 
 

  474,301  

 
 

  $  

 
 

  354,762  

 
 
 
 
 
 
 
 
 

   Liabilities and Shareholders' Equity   

 
 
 
 
 
 
 
 

   Current Liabilities   

 
 
 
 
 
 
 
 

  Accounts payable and accrued liabilities  

 
 

   $   

 
 

   23,972   

 
 

  $  

 
 

  27,176  

 
 

  $  

 
 

  19,256  

 
 

  Deferred revenue  

 
 
 

   740   

 
 
 

  638  

 
 
 

  908  

 
 

  Loans payable  

 
 
 

   1,705   

 
 
 

  5,734  

 
 
 

  48,559  

 
 

  Contingent consideration payable  

 
 
 

   40,553   

 
 
 

  30,966  

 
 
 

  24,008  

 
 

  Lease liability  

 
 
 

   2,117   

 
 
 

  1,710  

 
 
 

  891  

 
 

  Corporate income tax payable  

 
 
 

   32,466   

 
 
 

  27,739  

 
 
 

  16,381  

 
 

  Preferred share liability  

 
 
 

    

 
 
 

  

 
 
 

  

 
 
 
 

   101,553   

 
 
 

  93,963  

 
 
 

  110,003  

 
 

   Non-Current Liabilities   

 
 
 
 
 
 
 
 

  Loans payable  

 
 
 

   180,614   

 
 
 

  178,804  

 
 
 

  4,849  

 
 

  Contingent consideration payable  

 
 
 

    

 
 
 

  6,590  

 
 
 

  135,393  

 
 

  Lease liability  

 
 
 

   26,326   

 
 
 

  22,609  

 
 
 

  15,070  

 
 

  Warrant liability  

 
 
 

   121,551   

 
 
 

  132,257  

 
 
 

  

 
 

  Convertible debentures  

 
 
 

    

 
 
 

  4,083  

 
 
 

  10,682  

 
 

  Deferred income tax liability  

 
 
 

   27,275   

 
 
 

  27,263  

 
 
 

  20,774  

 
 
 
 

   355,766   

 
 
 

  371,606  

 
 
 

  186,768  

 
 

   Total Liabilities   

 
 

   $   

 
 

   457,319   

 
 

  $  

 
 

  465,569  

 
 

  $  

 
 

  296,771  

 
 
 
 
 
 
 
 
 

   Shareholders' Equity   

 
 
 
 
 
 
 
 

  Share capital  

 
 
 

   448,449   

 
 
 

  242,336  

 
 
 

  196,978  

 
 

  Contributed surplus  

 
 
 

   71,012   

 
 
 

  69,205  

 
 
 

  41,874  

 
 

  Cumulative translation adjustment  

 
 
 

   (1,858)   

 
 
 

  (3,819)  

 
 
 

  (826)  

 
 

  Deficit  

 
 
 

   (320,385)   

 
 
 

  (306,423)  

 
 
 

  (186,496)  

 
 

  Non-controlling interest  

 
 
 

   8,539   

 
 
 

  7,433  

 
 
 

  6,461  

 
 

   Total Shareholders' Equity   

 
 
 

   205,757   

 
 
 

  8,732  

 
 
 

  57,991  

 
 
 
 
 
 
 
 
 

   Total Liabilities and Shareholders' Equity   

 
 

   $   

 
 

   663,076   

 
 

  $  

 
 

  474,301  

 
 

  $  

 
 

  354,762  

 
 

   Total Number of Common and Proportionate Voting Shares Outstanding   

 
 
 

   178,956,366   

   
 
 

  155,834,272  

 
 
 

  141,980,314  

 
 
 
 

* Change in Presentation Currency; Please refer to Note 23 of the Company's filed Unaudited Condensed Interim Consolidated Financial Statements for and as of the three months ended March 31, 2021 for further discussion.

 

  Consolidated Statements of Profit and Losses (Unaudited) ($ thousands)  

 
 
                                                                                                                                                                                                      
 
 
 

   For the three months ended   

 
 
 
 

   March 31, 2021   

 
 
 

   March 31, 2020*   

 
 

   Sales, gross   

 
 

   $   

 
 

   56,496   

 
 

  $  

 
 

  28,143  

 
 

  Excise and cultivation taxes  

 
 
 

   (3,142)   

 
 
 

  (2,268)  

 
 

   Sales, net   

 
 
 

   53,354   

 
 
 

  25,875  

 
 

   Cost of sales   

 
 
 

   18,424   

 
 
 

  14,315  

 
 

   Gross profit before gain on fair value of biological assets   

 
 
 

   34,930   

 
 
 

  11,560  

 
 

  Unrealized gain on changes in fair value of biological assets  

 
 
 

   23,523   

 
 
 

  11,071  

 
 

  Realized fair value amounts included in inventory sold  

 
 
 

   (20,991)   

 
 
 

  (4,643)  

 
 

   Gross profit   

 
 
 

   37,462   

 
 
 

  17,988  

 
 

   Operating expenses:   

 
 
 
 
 
 

  General and administrative  

 
 
 

   15,762   

 
 
 

  10,856  

 
 

  Share-based payments  

 
 
 

   4,184   

 
 
 

  2,097  

 
 

  Amortization and depreciation  

 
 
 

   2,273   

 
 
 

  1,218  

 
 

  Research and development  

 
 
 

    

 
 
 

  154  

 
 

   Total operating expenses   

 
 
 

   22,219   

 
 
 

  14,325  

 
 
 
 
 
 
 

   Income from operations   

 
 
 

   15,243   

 
 
 

  3,663  

 
 

  Revaluation of contingent consideration  

 
 
 

   2,997   

 
 
 

  4,145  

 
 

  Finance and other expenses  

 
 
 

   7,246   

 
 
 

  2,457  

 
 

  Transaction and restructuring costs  

 
 
 

    

 
 
 

  428  

 
 

  Unrealized (gain) loss on investments  

 
 
 

   (228)   

 
 
 

  346  

 
 

  Impairment of intangible assets  

 
 
 

    

 
 
 

  344  

 
 

  Loss on fair value of warrants  

 
 
 

   5,410   

 
 
 

  

 
 

  Unrealized foreign exchange loss  

 
 
 

   2,783   

 
 
 

  40  

 
 

   Loss before income taxes   

 
 
 

   (2,965)   

 
 
 

  (4,097)  

 
 

  Current income tax expense (recovery)  

 
 
 

   9,212   

 
 
 

  4,361  

 
 

  Deferred income tax (recovery) expense  

 
 
 

   571   

 
 
 

  1,853  

 
 

   Net loss   

 
 

   $   

 
 

   (12,748)   

 
 

  $  

 
 

  (10,311)  

 
 

  Currency translation adjustment  

 
 
 

   (1,961)   

 
 
 

  1,853  

 
 

   Comprehensive loss   

 
 

   $   

 
 

   (10,787)   

 
 

  $  

 
 

  (12,164)  

 
 

   Net loss (income) attributable to:   

 
 
 
 
 
 

  Shareholders of the Company  

 
 
 

   (14,015)   

 
 
 

  (9,822)  

 
 

  Non-controlling interests  

 
 
 

   1,267   

 
 
 

  (489)  

 
 

   Comprehensive loss (income) attributable to:   

 
 
 
 
 
 

  Shareholders of the Company  

 
 
 

   (12,054)   

 
 
 

  (11,675)  

 
 

  Non-controlling interests  

 
 
 

   1,267   

 
 
 

  (489)  

 
 

   Net loss per share, basic and diluted   

 
 
 
 
 
 

  Net loss per share – basic and diluted  

 
 

   $   

 
 

   (0.08)   

 
 

  $  

 
 

  (0.07)  

 
 

  Weighted average number of outstanding common and proportionate voting shares  

 
 
 

   171,371,637   

 
 
 

  146,469,201  

 
 
 

* Change in Presentation Currency; Please refer to Note 23 of the Company's filed Unaudited Condensed Interim Consolidated Financial Statements for and as of the three months ended March 31, 2021 for further discussion.

 

SOURCE TerrAscend

 

 

 

 Cision View original content: https://www.newswire.ca/en/releases/archive/May2021/19/c9810.html  

 
 

News Provided by Canada Newswire via QuoteMedia

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Closeup of lush green cannabis leaves.

Thailand Reverses Course on Cannabis, Moves to Recriminalize Amid Political Fallout

Thailand’s groundbreaking experiment with cannabis decriminalization is rapidly unraveling, with the government formally moving to reclassify the plant as a narcotic and ban recreational sales.

The decision has sent shockwaves through an industry once projected to be worth over US$1 billion.

The country’s Ministry of Public Health issued an order this week stating that cannabis only be sold with a medical prescription, effectively ending a short-lived era of liberal recreational access.

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Cannabis leaf over map of Australia.

A State-by-State Guide to Cannabis in Australia

Australia federally legalised medicinal cannabis in 2016, and Australia's cannabis market has seen major growth since then.

Medical cannabis approvals were up by 120 percent in the first half of 2023 compared to the same period in 2022. Statista forecasts that Australian cannabis revenue will reach AU$3.73 billion in 2024 and grow at an annual rate of 3.22 percent, culminating in market volume worth AU$4.53 billion by 2029.

However, Australia’s cannabis industry is still young. Despite there being a strong case for a regulated market, which was outlined in a July 2024 report by the Penington Institute, recreational use is not legal and medical access remains limited and regulated.

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Cannabis leaf on road marked with "2025," with sunlight in the background.

New Cannabis Consumption Trends, Regulatory Shifts Seen Driving Market in 2025

Understanding trends in the cannabis industry is paramount for investors eyeing a market with steady growth potential, but the landscape is complex as products and regulations continue to evolve.

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.

Meanwhile, regulatory uncertainty, particularly surrounding the future of the US Farm Bill and state-level restrictions on hemp-derived cannabinoids, continues to challenge the market.

Despite these headwinds, production data and long-term growth forecasts suggest the cannabis industry remains on a promising — albeit turbulent — path. Read on for more on key trends to watch in 2025.

Consumption methods evolving post-legalization

Shifts in consumer behavior are reshaping markets across the board, and the cannabis industry is no exception.

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.

The report notes that vaping and dabbing are particularly pronounced among younger adults.

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).

In early 2020, Tilray launched a lineup of confectionery, wellness products and beverages through its subsidiary, High Park; Canopy Growth (TSX:WEED,NASDAQ:CGC) made a similar move. These companies gradually brought their products to the US as more states legalized cannabis for medical and/or recreational use.

Today, established cannabis brands typically offer edibles and beverages alongside their other products. Organigram Global (TSX:OGI,NASDAQ:OGI) is one of the newest US entrants, with its April acquisition of Collective Project providing immediate access to the US hemp-derived THC beverage market.

Growing awareness of health and wellness, potentially amplified by the pandemic-led adoption of health trackers, appears to be making an impact on the alcoholic beverage market.

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.

Challenges in the alcohol market extend beyond the brewing industry, with the New York Times recently reporting the closure of a handful of nightclubs facing decreased alcohol sales alongside rising insurance and rent costs.

Meanwhile, cannabis lounges have been popping up across the US for the last several years. As of early 2025, several states had legalized or were in the process of implementing regulations for cannabis consumption lounges.

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.

Person touching a cannabis plant; Australia map in flag colours.

ASX Cannabis Stocks: 10 Biggest Companies

While Australia has yet to legalise all forms of cannabis, the country is a growing medical cannabis and hemp market, with many companies manufacturing, researching and exporting the plant-based product.

Medical cannabis was federally legalised in 2016, and the export of cannabis from Australia was legalised in 2018. As for recreational use, the only state to legalise recreational use and possession so far is the Australian Capital Territory, which did so in 2020, but it did not establish a regulated recreational cannabis market.

The country's medical cannabis market has been steadily expanding in size and scope. A Penington Institute report shows that Australians spent approximately AU$400 million on medicinal cannabis in the first half of 2024, 72 percent higher than the AU$234 million they spent over the entirety of 2022.

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Cannabis Round-Up: Rescheduling Faces New Roadblocks, SAFER Banking Act Gets Another Look

February 2025 was characterized by an evolving legislative landscape and important financial updates from major players.

These developments underscore the complex and dynamic nature of the sector as it continues to navigate legal, financial, and regulatory challenges while experiencing ongoing growth and evolution.

Discussions around cannabis rescheduling, changes in federal agency leadership, state-level legalization efforts, and financial reports from key companies all contributed to a month of notable activity in the cannabis space.

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Cannabis leaves, US flag.

Cannabis Round-Up: Banking Reform and Rescheduling De-Prioritized as Trump Takes Office

As a new year began, the cannabis industry saw a range of impactful events in January.

Legal obstacles continued to impede progress on a once-promising attempt to reschedule cannabis in the US, and President Donald Trump's leadership choices for key agencies are diminishing hopes it can be accomplished.

Meanwhile, cannabis banking reform won't be discussed at Wednesday's (February 5) meeting of the Standing Senate Committee on Banking, Commerce and the Economy, and Congress seems in no rush to address it.

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