Marimed (MRMD) Q3 2024 earnings summary

Executive summary

• Achieved year-over-year and sequential revenue growth in Q3 2024, with continued positive operating cash flow and improved EBITDA and net income sequentially.

• Wholesale business drove double-digit revenue growth, outpacing industry trends, while retail revenue saw a slight decline due to macroeconomic pressures.

• Net loss attributable to common stockholders was $1.0 million for Q3 2024, an improvement from a $4.3 million loss in Q3 2023.

• Two acquisitions completed in 2024: Allgreens Dispensary (Illinois) and MedLeaf (Maryland), expanding the retail footprint.

• Strategic focus remains on organic growth, new market entry, and brand expansion, with flagship brands like Betty's Eddies performing strongly.

Financial highlights

• Q3 2024 revenue was $40.6 million, up 4.6% year-over-year and 0.4% sequentially, with nine-month revenue at $119.0 million, up 8.4%.

• Adjusted gross margin was 42.6%, down from 44.5% year-over-year; GAAP gross margin was 41.3%.

• Adjusted EBITDA was $4.7 million, down from $6.1 million year-over-year but up from $4.4 million sequentially; nine-month Adjusted EBITDA was $13.7 million.

• Year-to-date operating cash flow reached $7.2 million, a 54% increase over the prior year.

• Ended the quarter with $9.8 million in cash and $12.1 million in working capital.

Outlook and guidance

• Updated 2024 revenue growth target to 6%-8% (up from 5%-7%).

• Adjusted EBITDA now expected to be down 18%-20% (previously flat to up 2%).

• CapEx guidance raised to $11 million.

• Margin improvements expected as new assets ramp up and pre-opening costs subside, with strong 2025 results anticipated.

• Management expects current cash and future funding to be sufficient for at least the next twelve months.