SNDL (SNDL) Q4 2024 earnings summary

Executive summary

• Achieved record full-year net revenue of $920.4M (+1.3% YoY) and Q4 revenue of $257.7M (+3.7% YoY), driven by strong cannabis business growth and operational improvements.

• Gross profit reached $240.3M for the year (+26.2% YoY) and $68.8M in Q4 (+20.0% YoY), with record gross margins of 26.1% for the year and 26.7% in Q4.

• Positive free cash flow delivered for both Q4 ($11.6M) and full year ($8.9M), reflecting operational efficiencies and working capital management.

• Strategic actions included privatizing Nova Cannabis, acquiring Indiva, repurchasing 10.8M shares, and securing a 5.4% stake in High Tide.

• Ended 2024 with $218.4M in unrestricted cash and no outstanding debt, supporting future growth.

Financial highlights

• Q4 2024 net revenue: $257.7M, up 3.7% YoY; gross profit: $68.8M, up 20% YoY; gross margin: 26.7%, up 3.6pp.

• Full year 2024 net revenue: $920M, up 1.3% YoY; gross profit: $240M, up 26% YoY; gross margin: 26.1%, up 5.2pp.

• Q4 adjusted operating income: $(60.5)M, impacted by a $66M SunStream portfolio valuation adjustment; full year adjusted operating income: $(86)M.

• Q4 free cash flow: $11.6M (+700% YoY); full year free cash flow: $8.9M (+12% YoY), exceeding guidance.

• Net loss for 2024 was $(96.2)M, a significant improvement from $(176.6)M in 2023.

Outlook and guidance

• Targeting $100M in positive annual free cash flow within three years.

• Liquor segment revenue expected to be flat in 2025, with long-term industry growth of 1-1.5% and low single-digit volume declines offset by pricing.

• Anticipates CSE listing in April 2025 to enhance shareholder flexibility.

• Strategic priorities include expanding store count, growing private label, and optimizing overhead.