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California-based single-state operator Glass House Brands (OTC:GLASF) published its preliminary financials for the fourth quarter and full year ending Dec. 31, 2023, with the firm deeper in the red despite meaningful growth in revenue.

In the fourth quarter of 2023, the company reported net sales of $40.4 million, a 35% increase from the $29.9 million in the fourth quarter of 2022, but a 16% slump from the $48.2 million reported in the third quarter of 2023. That beat the Yahoo Finance average analyst estimate by $1.7 million.

However, net loss totaled $37.4 million, a 20% rise from $17.3 million in 2022’s fourth quarter, according to filings. The gross profit for the period was $18 million, up from $9.2 million in the same period the previous year, with the gross margin improving to 45% from 31%.

For the entire year, Glass House’s revenue reached $160.8 million, an 89% increase from the previous year, with an adjusted EBITDA of $24.5 million, reversing the previous year’s loss of $22.3 million.

Still, net loss came out to $97.4 million, a 192.49% rise from $33.3 million in the previous year.

“Strong demand for everything we grow continues and we ended the year with finished goods inventory relative to sales of less than two weeks,” CEO Kyle Kazan said in a statement. “We need more inventory to meet this demand and are very excited that Greenhouse 5 is now online and fully planted after starting cultivation at the end of January.”

The company also noted operational improvements, such as a 5% reduction in the cost per equivalent dry pound of production and a 37% increase in production volume. The year ended with a cash balance of $32.5 million, more than double the previous year’s $14.1 million.

Glass House also said it would restate its financial statements for previous fiscal years to correct identified issues. The restatement is expected to impact the reported financials for 2021 and 2022, as well as the interim period ending March 31, 2023.

Looking forward, Glass House anticipates continued sales growth and expansion in 2024, particularly with the new Greenhouse 5 facility coming online, which is expected to beef production capacity.

The company expects total revenue to be between $28 million and $29 million in the first quarter, a bit more than the same time last year but less than what they made at the end of 2023, which is normal due to the seasonal nature of their business.

For the second quarter of 2024, Glass House predicts a big increase in earnings, expecting between $52 million and $54 million. The expectation stems from the idea that the firm’s new greenhouse will be working at full capacity, providing better growing conditions for their products.

For the entire year, Glass House is targeting to earn between $215 million and $220 million, which would be a significant jump from the previous year. The goal is based on the added production from the new greenhouse and their plans for improving sales and operations.

The post Glass House nearly $100M in the red despite increased sales in 2023 appeared first on Green Market Report.

420GrowLife

via www.KahliBuds.com

Adam Jackson, KahliBuds, 420GrowLife