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 first quarter ended March 31, 2021. All financial information is provided in U.S. dollars unless otherwise indicated.

1Q 2021 Financial Highlights (Unaudited)

($ thousands, except per share amounts) Q1 2021 Q4 2020 % qoq
 Q1 2020 % yoy
Total Revenue$260,320$230,25313%$96,496170%
Gross profit before impact of biological assets$128,467$110,59516%$52,483145%
Gross profit on cannabis sales(1) $128,030$109,62517%$33,042287%
Gross margin on cannabis sales(1)  49% 48%  43% 
Adjusted EBITDA(1)$62,625$53,78416%$20,006213%
Net income (loss) attributable to Curaleaf Holdings Inc.$(17,211)$(35,274) $(15,089) 
Net income (loss) per share – basic and diluted$(0.03)$(0.05) $(0.03) 
(1)See “Non-IFRS Financial and Performance Measures” below for more information regarding Curaleaf’s use of Non-IFRS financial measures and other reconciliations.
Earnings Call: Monday, May 10, 2021, at 5:00 P.M. ET
Conference ID # is 6935525
Replay ID # is 10155488
U.S. Callers: 1 (888) 317 6003U.S. Replay: 1 (877) 344 7529
International Callers: 1 (412) 317 6061 International Replay (Toll): 1 (412) 317 0088
Canadian Callers: 1 (866) 284 3684Canadian Replay: 1 (855) 669 9658
The teleconference will be rebroadcasted starting at 7:00 P.M. ET
on May 10, 2021 and will end at 7:00 P.M. ET on May 17, 2021

Joe Bayern, Chief Executive Officer of Curaleaf stated, “Curaleaf delivered record first quarter 2021 financial results with total revenue exceeding the high-end of our guidance range as we extended our U.S. leadership, all while creating a new foundation for future international growth opportunities. The stronger than expected first quarter performance drove record adjusted EBITDA as well as approximately 640 basis points of improvement in gross margin year-over-year. These impressive results reflect the leverage of the strategic investments we have made across the organization in cultivation, product innovation as well as expanding our branded retail and wholesale distribution channels. Curaleaf launched a range of innovative new products to our retail and wholesale channels during the quarter, including our new Select Squeeze THC-infused beverage enhancer which marked our most successful product launch ever and represented one of the cannabis industry’s widest national product launches to date. With our revenue projected to increase to $305 million to $315 million in the second quarter, we also expect to generate significant improvements in terms of achieving positive net income and positive operating cash flows in the back half of 2021.”

Boris Jordan, Executive Chairman of Curaleaf commented, “With the acceleration of cannabis liberalization momentum at the state and federal levels, Curaleaf’s prospects for growth in the United States have never been stronger. The recent approvals of adult-use cannabis in New Jersey and New York, which are states where Curaleaf has a leading market share, will unlock vast new markets, worth an estimated $2.1 billion and $5 billion in sales respectively. We raised approximately $300 million in new capital during the first quarter to help support our ability to scale for new adult-use markets while also allowing us to be opportunistic for highly attractive assets that further strengthen our position as the global cannabis market leader.”

First Quarter Highlights

  • Record revenue of $260 million, a growth of 170% YoY, above guidance of $250 million to $255 million.
  • Record adjusted EBITDA of $63 million, a growth of 213% YoY, and equivalent to a margin of 24%.
  • Raised net proceeds of $240.6 million in a public offering and net proceeds of $49.9 million from a tack-on to the existing secured credit facility.
  • Closed the quarter with 102 retail locations and 1,992 wholesale partner accounts.
  • Launched Select Squeeze, a THC-infused beverage enhancer, to date the widest cannabis product launch in the nation, available in 14 states.
  • Retail revenue grew by 14% sequentially, and 231% YoY, representing 72% of total revenue.
  • Wholesale revenue grew by 12% sequentially, and 254% YoY, representing 28% of total revenue.

Post First Quarter Highlights

  • Successfully closed the acquisition of EMMAC, Europe’s largest vertically integrated independent cannabis company, while securing $80 million in new capital into the European business subsidiary from a strategic investor to support future growth.
  • Opened four new stores since March 31, 2021 in Illinois and Pennsylvania, bringing total retail locations to 106.

Financial Results for the First Quarter Ended March 31, 2021

Total revenue increased by 170% to $260 million during the first quarter of 2021, compared to $96 million in the first quarter of 2020.

Revenue (Unaudited)
($ thousands)
  Q1 2021 Q4 2020 Q1 2020
Retail revenue$187,677$164,932$56,633
Wholesale revenue 72,206 64,351 20,422
Management fee income 437 970 19,441
Total Revenue$260,320$230,253$96,496

Retail revenue increased by 231% to $188 million during the first quarter of 2021, compared to $57 million in the first quarter of 2020, representing 72% of total revenue. Growth in retail revenue was primarily due to strong organic growth across Curaleaf’s footprint, the opening of six new stores across Florida, Maine, and Pennsylvania, and the rapid acceleration of revenue growth in Arizona after the introduction of adult-use sales in January of 2021.

Wholesale revenue increased 254% to $72 million during the first quarter of 2021, compared to $20 million in the first quarter of 2020, representing 28% of total revenue. Growth in wholesale revenue was due primarily to the continued national expansion of the Select brand in both the Central and Northeastern markets including Massachusetts, New York, New Jersey, Maryland, Illinois, and Pennsylvania, and the successful launch of new products such as Select Squeeze, Select Essentials, and Select Fresh. It also resulted from strength of the Select brand in core Western markets including Arizona, California, and Oregon.

Gross Profit on Cannabis Sales (Unaudited)
($ thousands)
  Q1 2021 Q4 2020 Q1 2020
Retail and wholesale revenues$259,883$229,283$77,055
Cost of goods sold 131,853 119,658 44,013
Gross profit on cannabis sales$128,030$109,625$33,042

Gross profit on cannabis sales was $128 million for the first quarter of 2021, compared to $33 million in the first quarter of 2020. Gross profit margin reached 49%, equivalent to a year-over-year increase of 636 basis points. The increase was primarily due to an expansion in operating capacity as well as improved efficiency in the Company’s cultivation and processing facilities.

Net Income (Loss)
($ thousands)
  Q1 2021 Q4 2020 Q1 2020
Total Revenues$260,320$230,253$96,496
Gross profit 140,814 125,462 68,039
Income (Loss) from operations 33,705 20,627 4,993
Total other income (expense), net (20,208) (17,893) (7,196)
Income tax benefit (expense) (30,708) (37,843) (13,249)
Net loss$(17,211)$(35,109)$(15,089)

For the first quarter of 2021, net loss attributable to Curaleaf Holdings, Inc. was $17 million, compared to a net loss of $15 million in the first quarter of 2020. The net result was primarily impacted by an income tax provision of $31 million due to increased gross profit in certain of the Company’s subsidiaries that are subject to the restrictions of Section 280E of the Internal Revenue Code and, to a lesser degree, by an increase in the interest expense related to lease liabilities due to the expanded number of retail sites. Net loss for the quarter included approximately $6 million in one-time charges which mostly include expenses associated with the equity offering and debt raise. These effects were partially compensated by a significant increase in Income from Operations.

Adjusted EBITDA (Unaudited)
($ thousands)
  Q1 2021 Q4 2020 Q1 2020
Net income (loss)$(17,211)$(35,109)$(15,452)
Interest expense, net 20,623 25,366 9,804
Income tax expense 30,708 37,843 13,249
Depreciation and amortization (1) 30,155 29,034 14,906
Share-based compensation 4,907 16,114 4,501
Other (income) expense (415) (7,473) (2,608)
Change in fair value of biological assets (12,347) (14,867) (15,556)
One time charges (2) 6,206 2,876 11,162
Adjusted EBITDA$62,625$53,784$20,006
(1)Depreciation and amortization expense in Q1 2021, Q4 2020, and Q1 2020 include amounts charged to cost of goods sold on the statement of profits and losses. 
(2)One time charges in Q1 2021 mostly include expenses associated with the equity offering and debt raise.

Adjusted EBITDA was a record $63 million for the first quarter of 2021, compared to $20 million for the first quarter of 2020. The year-over-year increase in adjusted EBITDA was primarily driven by solid revenue growth combined with strong operating leverage.

Balance Sheet and Liquidity

As of March 31, 2021, the Company had $315 million of cash and $340 million of outstanding debt net of unamortized debt discounts.

Capital Expenditures

During the first quarter of 2021, Curaleaf invested $31 million net in capital expenditures, mostly attributable to cultivation, processing, and retail sites development activities.

Shares Outstanding

As of March 31, 2021 and December 31, 2020, our weighted average shares outstanding amounted to 682,041,420 and 557,192,899 shares, respectively.

As of March 31, 2021 and December 31, 2020, our issued and outstanding SVS and MVS shares amounted to 686,409,852 and 663,801,845 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 (Unaudited)
($ thousands)
  March 31, December 31,
  2021 2020
Current assets:      
Cash $314,591 $73,542
Accounts receivable  33,750  28,830
Inventory, net  237,254  197,991
Biological assets  46,452  46,210
Assets held for sale  60,922  58,504
Prepaid expenses and other current assets  22,785  10,140
Current portion of notes receivable  3,723  2,645
Total current assets  719,477  417,862
Deferred tax asset  5,528  5,528
Notes receivable  2,004  2,000
Property, plant and equipment, net  259,109  242,855
Right-of-use assets, net  265,078  267,168
Intangible assets, net  781,111  797,401
Goodwill  469,837  470,144
Investments  16,264  16,264
Prepaid acquisition consideration  132,234  132,234
Other assets  30,726  35,135
Total assets $2,681,368 $2,386,591
Liabilities and Shareholders’ Equity      
Current liabilities:      
Accounts payable $38,651 $47,043
Accrued expenses  54,368  57,475
Income tax payable   110,147  79,649
Current portion of lease liability  16,382  15,710
Current portion of notes payable   4,193  6,500
Liabilities held for sale  12,775  7,181
Other current liabilities  1,454  6,568
Total current liabilities  237,970  220,126
Deferred tax liability  222,566  226,465
Notes payable  335,320  285,001
Lease Liabilities  270,948  270,495
Non-controlling interest redemption liability  2,694  2,694
Contingent consideration liability   1,898  1,898
Other long term liability  3,864  3,698
Total liabilities  1,075,260  1,010,377
Shareholders’ equity:      
Share capital  2,021,980  1,754,412
Treasury shares  (5,208)  (5,208)
Reserves  (198,207)  (177,744)
Accumulated deficit  (211,856)  (194,645)
Total Curaleaf Holdings, Inc. shareholders’ equity  1,606,709  1,376,815
Redeemable non-controlling interest  (2,694)  (2,694)
Non-controlling interest     2,093  2,093
Total shareholders’ equity  1,606,108  1,376,214
Total liabilities and shareholders’ equity $2,681,368 $2,386,591
Consolidated Statements of Profits and Losses (Unaudited)
($ thousands, except for share and per share amounts)
 Three Months Ended
 March, 31
 2021 2020
Retail and wholesale revenues$259,883 $77,055
Management fee income 437  19,441
Total revenues 260,320  96,496
Cost of goods sold 131,853  44,013
Gross profit before impact of biological assets 128,467  52,483
Realized fair value amounts included in inventory sold (68,914)  (21,191)
Unrealized fair value gain on growth of biological assets 81,261  36,747
Gross profit 140,814  68,039
Operating expenses:     
Selling, general and administrative 80,090  45,857
Share-based compensation 4,907  4,501
Depreciation and amortization 22,112  12,688
Total operating expenses 107,109  63,046
Income (Loss) from operations 33,705  4,993
Other income (expense):     
Interest income 88  2,846
Interest expense (12,151)  (10,492)
Interest expense related to lease liabilities (8,560)  (2,158)
Other income (expense) 415  2,608
Total other income (expense), net (20,208)  (7,196)
Income (Loss) before provision for income taxes 13,497  (2,203)
Income tax benefit (expense) (30,708)  (13,249)
Net loss (17,211)  (15,452)
Less: Net income (loss) attributable to non-controlling interest   (363)
Net loss attributable to Curaleaf Holdings, Inc.$(17,211) $(15,089)
Loss per share attributable to Curaleaf Holdings, Inc. – basic and diluted$(0.03) $(0.03)
Weighted average common shares outstanding – basic and diluted 682,041,420  507,700,498

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, Select and Grassroots 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 106 dispensaries, 23 cultivation sites and more than 30 processing sites, employing over 4,800 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