Glass House Brands Q1 2024 Earnings Release
The TDR Three Key Takeaways regarding Glass House Brands Q1 2024 Earning Release :
- Glass House reports a 9% annual increase in Q1 2024 revenue, reaching $30.1 million.
- Biomass production surges 28% YOY without expanding the cultivation area.
- Glass House projects Q2 revenue to hit a record $52-$54 million.
Glass House Brands Inc. (OTCQX: GLASF, GHBWF) reported its financial results for the first quarter of 2024, showing progress and areas for improvement. Despite a net loss, the company displayed significant growth in key operational metrics and remains positive about its future.
For Q1 2024, the company’s net revenue was $30.1 million, up 9% from $27.6 million in Q1 2023, but down 26% sequentially from $40.4 million in Q4 2023. The gross profit for the quarter was $12.5 million, resulting in a gross margin of 42%, compared to 46% in Q1 2023 and 45% in Q4 2023. Adjusted EBITDA was negative $1.6 million, a drop from $0.5 million in Q1 2023 and $3.8 million in Q4 2023.
Kyle Kazan, Co-Founder, Chairman, and CEO of Glass House, discussed the company’s performance: “The first quarter of 2024 was another successful quarter for Glass House where we exceeded Q1 guidance across all operating metrics including cash, sales, production, and Adjusted EBITDA.” He added, “We produced 61,300 pounds of biomass, revenue of $30.1 million, and a gross profit of $12.5 million or 42% of net revenue during the first quarter, all ahead of our guidance.”
The company ended the quarter with a cash balance of $24 million, up from $16.4 million at the end of Q1 2023, but down from $32.5 million at the end of Q4 2023. Operating cash flow was negative $1.9 million, compared to positive $4.5 million in Q1 2023 and $1.4 million in Q4 2023. This decrease was attributed to higher seasonal production costs and a reduced gross margin percentage.
Kazan also praised the success of their retail and Consumer Packaged Goods (CPG) teams: “I am particularly proud of our retail and CPG teams. We saw a 4% increase in CPG revenue versus Q4 2023 with Allswell revenue growing by 20%. The Allswell eighth priced at $9.99 out-the-door, including taxes, has been one of our most successful launches ever and shows the strength of our vertical integration, from farm to consumer.”
Biomass production reached 61,334 pounds in Q1, exceeding guidance and reflecting a 28% year-over-year increase, achieved without any expansion in the cultivation footprint. The cost per equivalent dry pound of production was $182, a 7% decrease from Q1 2023, indicating improved operational efficiency.
Looking ahead, Glass House projects Q2 2024 revenue to reach a new record between $52 million and $54 million, driven by the first full quarter of production and sales from Greenhouse 5, now operating at full capacity. Kazan expressed confidence in the facility’s potential, stating, “We are very pleased with the initial production volumes, quality, and yields that are coming out of this facility, and are confident that the facility will continue to pick up steam as the year progresses.”
Glass House Brands remains dedicated to its strategic objectives and expects strong financial performance in the upcoming quarters. The company maintains its revenue guidance for 2024 at $215 million to $220 million, expecting adjusted EBITDA to surpass $50 million, supported by significant growth in biomass production and continued retail and CPG expansion. Want to keep up to date with all of TDR’s research and news, subscribe to our daily Baked In newsletter.
