7 Key Takeaways From Tilray’s Q4 Earnings Release

Yesterday, Tilray, Inc. (TSX: TLRY) (Nasdaq: TLRY) released fourth quarter financial results that included numbers from its merger with Aphria and the stock ended the day up more than 25%. 

Although Tilray reported 25% higher revenue when compared to the same period last year, the numbers came in below analysts’ estimates. During the quarter, the business was negatively impacted by COVID-19 lockdowns in Ontario that started in early April (the country’s largest province by population). The province is a key market for the Canadian cannabis producer and we will monitor how lockdowns impact future quarters. 

Tilray CEO Irwin Simon said the company had recognized approx. $35 million of synergies and we are favorable on how the combined company is lowering expenses. Simon said the company is on track to save $80 million over the next 16 months and we will monitor how the management team is able to execute on this. 

Today, we want to highlight 7 important data points from Tilray’s fourth quarter earnings report and consider these data points to be key aspects of the story:

1. Generated $142.2 million of net revenue which was lower than the average estimate of $146.2 million (according to Refinitiv IBES estimates)
2. Recorded $33.6 million of net income for the quarter which included a one-time adjustment of $19.9 million from excess inventory quantities due to the Aphria merger
3. Adjusted EBITDA was $12.3 million which represents a 285% increase when compared to the same period last year. The quarter was the company’s ninth consecutive quarter of positive Adjusted EBITDA
4. Net cannabis revenue grew to $53.7 million, a 36% increase
5. Net beverage alcohol revenue was $15.9 million which is related to the acquisition of SweetWater Brewing Company 
6. Net wellness revenue was $5.8 million and this amount was from Manitoba Harvest
7. Ended the quarter with a strong balance sheet and reported to have $488.5 million of cash and cash equivalents 

We believe that Tilray is executing on a multi-national expansion strategy and are bullish on the growth prospects that are associated with it. If you are interested in learning more about Tilray, please send an email to support@technical420.com with the subject “Tilray” to be added to our distribution list. 

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Michael Berger is Managing Partner of StoneBridge Partners LLC. SBP continues to drive market awareness for leading firms in the cannabis industry throughout the U.S. and abroad.

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