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Tilray Brands, Inc. (TLRY) reported its financial results for the first quarter ended August 31, 2023 today. All financial data is reported in U.S. dollars, unless otherwise indicated and in comparison to the previous quarter. Highlights are as follows:

Q1 Financial Highlights

Please note that the inclusion of financial data in Q1 as a result of the acquisition of HEXO Corp. in June, Truss Beverage Co. in August, and eight beer and beverage brands from Anheuser-Busch does not make for a true comparison between Q1 2024 and Q4 2023 but the data is presented, nevertheless, as it appears on the books for Q1,  

• Net Revenue: DOWN 4.0% to $176.9M 
  • Cannabis Business: UP 9.2%
    • Canadian Medical: N/C
    • Adult-use: UP 120.0%
    • International: DOWN 7.0%
  • Wellness Business: DOWN 13.6%
  • Beverage Alcohol Business: DOWN 35.4%
  • Distribution Business: UP 149.3%
• Adj. Gross Profit: DOWN 26.6% to $49.3M 
  • Cannabis Business: DOWN 38.5% 
  • Wellness Business: DOWN 13.6%
  • Beverage Alcohol Business: DOWN 35.4%
  • Distribution Business: UP 149.3%
• Adj. Gross Margin: DOWN to 28% from 37%
  • Cannabis Business: DOWN to 35% from 61% 
  • Wellness Business: DOWN to 29% from 30%
  • Beverage Alcohol Business: UP to 56% from 55%
  • Distribution Business: UP to 11% from 9%
• Net Income (Loss): UP to $70.0M from $(32.4)M
• Adj. Net Loss: DOWN 53.3% to $(55.9)M
• Adj. EBITDA: DOWN 48.6% to $11.4M
• Operating Cash Flow: Negative at $(15.8)M
• Cash/Marketable Securities on Hand: UP 4.0% to $466.5M

Management Commentary:

Irwin D. Simon, Chairman and CEO, stated:

“...Our diversified business model has positioned Tilray Brands as:

1. the #1 Canadian cannabis LP,
2. the market leader in medical cannabis across Europe,
3. a leader in the hemp foods industry, and
4. a formidable player in the fast-growing craft beverage-alcohol industry with a growing leadership position.

We have strategically diversified our company globally over the past several years and, as a result, Tilray is now ideally positioned to capture a wide range of opportunities across multiple industries driving value through:

• organic and acquisitive revenue growth,
• operating efficiencies, and
• improved margins and profitability.

We will continue to invest in our future and accelerate our vision of becoming a multi-billion-dollar company with a portfolio of best-in-class brands.

Since the beginning of our FY 2024, we have closed on three transactions:

1. HEXO Corp. in June, and the
2. Truss Beverage Co. in August, both of which have already boosted our competitive cannabis positioning in Canada, the largest, federally legalized cannabis market in the world, by increasing our leading market share, and 
3. the acquisition of eight beer and beverage brands from Anheuser-Busch earlier this week which has made us the 5^th largest craft beer brewer in the U.S., up from the 9^th position.

We are now working on the seamless integration of these acquisitions into our efficient operating platforms by leveraging our deep CPG expertise and established track record to drive revenue through product innovation and expanded distribution and maximize cost savings through synergy realization.”

Operational Highlights

• grew its #1 cannabis market share position to 13.4% in Q1 2024 and is #1 in cannabis Flower, Oils, Concentrates, and THC Beverages, #2 in Pre-Rolls, #4 in Vape, and in the Top 10 in all other categories;
• closed on the HEXO transaction in June 2023, significantly bolstering its position supported by low-cost operations and complementary distribution across all Canadian geographies;
• made substantial strides in performance across its five craft-beverage brands including SweetWater Brewing Company, Breckenridge Distillery, and Montauk Brewing Company, growing revenue in its beverage alcohol segment by 17% and adjusted gross profit by 24%;
• maintained its brand leadership position in branded hemp with a 52% market share and increased its gross margin to 29% from 26% through price increases;
• closed on its acquisition of eight beer and beverage brands (Shock Top, Breckenridge Brewery, Blue Point Brewing Company, 10 Barrel Brewing Company, Redhook Brewery, Widmer Brothers Brewing, Square Mile Cider Company, and HiBall Energy) from Anheuser-Busch which further diversified Tilray’s growing U.S. beverage alcohol segment. Their expected sales volume should elevate Tilray Brands to the 5th largest position in the high-growth U.S. craft beer market, up from the 9^th position.

Fiscal Year 2024 Guidance

• The Company is reiterating its adjusted EBITDA target of $68 million to $78 million representing growth of 11% to 27% as compared to fiscal year 2023. In addition, the Company expects to generate positive adjusted free cash flow.

Stock Price

Tilray's stock price went UP 77.2% during the Q1 period (June, July, August), went DOWN 19.3% in September, was DOWN 7.9% as of yesterday, October 3rd, and remained relatively unchanged today with the release of its Q1 financial report this morning. It is still DOWN 68.4% YTD.

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