TerrAscend Posts Another Solid Quarter Of Results
TerrAscend Corp. reported impressive Q2 2024 financial results, reflecting robust growth and operational efficiency. Net revenue hit $77.5 million, marking a 7.5% year-over-year increase from $72.1 million. However, the gross profit margin slightly dipped to 48.6%, down from 50.2% in Q2 2023, highlighting some margin pressure amid expansion efforts.
The company recorded a GAAP net loss from continuing operations of $6.2 million, a substantial improvement compared to the $12.9 million net loss in Q2 2023. This reduction in losses indicates better cost management and operational efficiencies. EBITDA from continuing operations skyrocketed by 186% year-over-year, reaching $18.6 million compared to $6.5 million in the prior year. Adjusted EBITDA also saw a healthy increase, growing 21.9% to $15.6 million from $12.8 million in Q2 2023. The adjusted EBITDA margin improved to 20.2%, up from 17.8%, underscoring enhanced profitability.
Cash flow metrics were particularly strong. Net cash provided by continuing operations surged to $13.1 million, a significant rise from $1.8 million in Q2 2023. Free cash flow turned positive at $11.7 million, compared to negative $0.2 million the previous year, indicating strong cash generation capabilities.
Jason Wild, Executive Chairman of TerrAscend, commented, “For the second quarter, revenue and EBITDA increased materially year-over-year, and we delivered another quarter of positive free cash flow.” He highlighted the company’s strategic focus and financial flexibility following the closure of a $140 million term loan, which will fuel future growth initiatives.
Operationally, TerrAscend achieved several milestones. The company maintained its position as the market leader in New Jersey for the first half of 2024, doubled its wholesale revenues in Pennsylvania and New Jersey, and grew Maryland’s wholesale revenue by 117% year-over-year. Notably, the Michigan market maintained a 40% gross margin for the third consecutive quarter, demonstrating consistent profitability.
The company also expanded its retail footprint with the opening of the GAGE 313 dispensary in Detroit and the relocation of its Nottingham, Maryland dispensary. Furthermore, TerrAscend expanded cultivation capacity at its Hagerstown, Maryland facility, aligning with its strategic growth objectives.
These financial and operational highlights reflect TerrAscend’s robust performance and strategic initiatives, positioning the company for continued growth. The company’s ability to generate positive cash flow for the eighth consecutive quarter and its leadership position in key markets underscore its operational excellence and market penetration.
Looking ahead, TerrAscend aims to capitalize on its “wide open map” strategy by entering new markets through accretive deals with top-tier operators. The company is poised for further growth and expansion, driven by a strong financial foundation and strategic execution.
In summary, TerrAscend’s Q2 2024 results demonstrate solid revenue growth, improved profitability, and strong cash flow generation, positioning the company well for future expansion and market leadership in the cannabis industry.
