Marimed (MRMD) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue grew 11% year-over-year to $40.4 million, driven by strong wholesale and retail performance, especially in Maryland, with sequential growth and a 24% increase in retail transactions.

• Achieved seventh consecutive quarter of double-digit transaction growth year-over-year.

• Strategic acquisitions in Maryland and Illinois, including Allgreens and MedLeaf, expanded the retail footprint and support growth initiatives.

• Investments in new assets and market expansion are expected to drive future margin improvement and cash flow.

• New dispensaries and cultivation facilities are coming online in Illinois, Maryland, Massachusetts, Ohio, and Missouri.

Financial highlights

• Q2 2024 revenue was $40.4 million, up from $36.5 million in Q2 2023, with wholesale growth offsetting some retail declines.

• Adjusted gross margin was 42.9%, down from 43.8% in Q1 2024 and 46.0% in Q2 2023, due to higher input and ramp-up costs.

• Adjusted EBITDA was $4.4 million (margin 10.8%), down from $6.3 million (margin 17.3%) in Q2 2023, reflecting lower margins and higher operating expenses.

• Net loss attributable to common stockholders was $1.7 million, compared to $1.0 million in Q2 2023.

• Ended Q2 with $10.2 million in cash and equivalents, down from $14.6 million at 2023 year-end, mainly due to acquisitions and inventory build.

Outlook and guidance

• Maintains full-year 2024 targets: 5%-7% revenue growth, 0%-2% adjusted EBITDA growth, and ~$10 million in CapEx.

• Additional upside expected from new assets coming online in the second half of 2024.

• Margin expansion anticipated as new facilities ramp up, with improvements expected in late 2024 and into 2025.

• Management expects to commence retail sales at the MedLeaf dispensary in Maryland later in 2024, pending regulatory approval.

• Current cash and anticipated funding are expected to meet working capital and capital expenditure needs for at least the next twelve months.