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Ayr Wellness Inc. (CSE: AYR.A, OTCQX: AYRWF), a vertically integrated U.S. multi-state cannabis operator MSO constituent in the munKNEE American Cannabis MSO Index, reported Q4 ended December 31, 2022. All results are presented in U.S. dollars with Q4 being compared with Q3.
 

Fourth Quarter Financial Summary 

($ in millions, excl. margin items)

*excludes a non-cash goodwill impairment charge of $149M

• Cash on Hand: $80.6M
   

Management Commentary

David Goubert, President & CEO, said:

• “I’d like to thank our team for pulling together to deliver a strong fourth quarter,
  • growing our adjusted EBITDA by 20% sequentially,
  • and a second straight quarter of generating positive cash flow from operations.
• In the past few months, our team has begun the process of evaluating every aspect of our business with fresh eyes, conducting a thorough review of our markets, people, and processes, seeking to maximize the financial health of our Company and better position Ayr as a retailer of choice and house of brands. Throughout that process, we have:
  • implemented cost saving measures,
  • stepped back from certain markets that didn’t align with our core business goals, and
  • invested further into markets and activities that did meet those goals.
• By better prioritizing our time, our attention, and our capital, we find ourselves better positioned to capture growth opportunities in our existing and future footprint, which we anticipate will help us grow our:
  • cash flow profile,
  • our revenue, and
  • adjusted EBITDA margins consistently throughout 2023.”
     

Fourth Quarter Operational Highlights

• Retail Updates
  • Opened two new dispensaries in Florida bringing Ayr’s total footprint to 53 dispensaries across the state.
• Brand/Product Updates
  • Introduced HAZE live resin concentrates and vapes into Florida and Nevada.
  • Expanded Levia water-soluble tinctures into Florida.
  • Announced rebranding of its Florida stores from Liberty Health Sciences to AYR Cannabis Dispensary this summer.
• Corporate Updates
  • Announced mutual termination of Ayr’s proposed acquisition of Gentle Ventures, LLC which operates two licensed retail dispensaries in Chicago, Illinois.
  • Signed an agreement to sell Blue Camo, LLC which comprises the Company’s Arizona assets, to AZ Goat, LLC.
  • Entered into an option to acquire two Ohio dispensary licenses from Daily Releaf, LLC and Heaven Wellness, LLC, to begin establishing a vertical integrated presence in the state.
     

Outlook

• The Company anticipates its financial results in the first quarter of 2023 to be consistent with industry trends,
  • expects revenue and adjusted EBITDA in Q1 2023 to be in-line with Q4 2022 and
  • expects to further ramp revenue, adjusted EBITDA, and operating cash flow thereafter.
     

Stock Performance

Ayr's stock price:

• declined 48.9% during the Q4 period (October, November, December),
• declined a further 21.5% YTD (February 8th)
• and was down another 8% in Thursday morning trading as the result of the Q4 financial result.

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