Too much pot and not enough demand continues to weigh on medical marijuana prices, with losses continuing for one of the biggest providers in Pennsylvania.
Tallahassee, Fla.-based Trulieve Cannabis Corp. reported a net loss of $404 million for the three months ending June 30, up from a loss of $22 million for the same period a year ago as revenue fell 10% to $282 million from $314 million in 2022. Trulieve’s net loss for the six months ending June 30 was $468 million, more than eight times the loss of $54 million a year ago as revenue for the period sagged 9% to $567 million from $624 in 2022.
Excluding non-recurring charges, asset and goodwill impairments, the company’s net loss for the quarter was $15 million.
Things at Trulieve likely won’t get better soon: Revenue was expected to decline in the mid-single digits in the third quarter, according to an investors’ presentation.
Gross profit for the three months declined 23% to $142 million from $183 million a year ago; profit dropped 20% for the six months to $292 million from $363 million in 2022.
During the second quarter, Trulieve began winding down operations in Massachusetts and shuttered retail outlets in California to preserve cash and direct assets to more attractive markets, which includes opening 15-20 dispensaries in other states.
Trulieve has 20 medical marijuana dispensaries in Pennsylvania, including ones in Cranberry, Zelienople and Squirrel Hill along with a cultivation and processing facility in McKeesport. The company has 186 dispensaries and 4 million square feet of cultivation and processing facilities in the U.S.
Oversupply and the failure to pass banking reform legislation that would give the industry access to capital and other benefits are among the reasons cited for the lackluster performance of the cannabis industry. For example, shares in AdvisorShares Pure U.S. Cannabis ETF, a popular gauge of industry performance, hit $4.99 a share in midday trading Aug. 14, down 64% from $13.69 a share peak Dec. 5.
Kris B. Mamula: kmamula@post-gazette.com
First Published: August 14, 2023, 6:48 p.m.
Updated: August 14, 2023, 9:36 p.m.
