StateHouse (STHZ) Q4 2023 & Q1 2024 earnings summary

Executive summary

• Achieved strong Q1 2024 gross margin of 46.5% and maintained revenue at $25.4 million, despite market headwinds.

• Advanced to 4th largest cannabis brand operator in California, up from 8th in 2023, with significant market share gains.

• Introduced 23 new products and 40 in-house strain formulations, with new products accounting for 15% of 2024 YTD sales.

• Appointed Kevin K. Albert to the Board and engaged Roger Jenkins as consultant to strengthen the balance sheet.

Financial highlights

• Q1 2024 net revenues rose to $25.4M from $24.7M in Q1 2023; gross profit before biological asset adjustments was $11.8M, up from $10.9M.

• Q1 2024 adjusted EBITDA improved to $0.8M from a loss of $2.4M in Q1 2023.

• FY 2023 net revenues were $101.0M, down from $108.2M in FY 2022; gross profit before adjustments was $45.1M, up from $42.1M.

• FY 2023 consolidated gross margin improved to 44.9% from 36.2% in FY 2022.

• Q4 2023 net revenues were $25.1M, slightly down from $25.5M in Q4 2022; gross margin declined to 41.6% from 42.4%.

Outlook and guidance

• Management expects continued margin improvement and cost reductions, with positive adjusted EBITDA trends into Q2 2024.

• Positioned for future market expansion and further financial resilience through operational optimization.