Debra BorchardtAYR Wellness Inc. (CSE: AYR.A, OTCQX: AYRWF) reported financial results for the fourth quarter and full year ended Dec. 31, 2023. Ayr Wellness was inline with Yahoo Finance average analyst estimates for the fourth quarter.
Fourth quarter revenue for Ayr Wellness inched higher by just 0.4% to $114.8 million from last year’s $114.3 million. Revenue was up 0.3% sequentially. The net loss for the quarter was greatly improved to just $30 million versus 2022’s fourth quarter net loss of $168 million.
Full-year results
Revenue jumped by 10% to $463.6 million from 2022’s revenue of $421.4 million. While net losses were trimmed in the fourth quarter, for the full year Ayr delivered a whopping net loss of $272 milllion versus 2022’s net loss of $245 million. Discontinued operations seemed to be the reason for the outsize losses. AYR ended the year with a cash balance of $50.8 million.
David Goubert, President & CEO of AYR, said, “We grew revenue 10%, grew Adjusted EBITDA by 51%, expanded Adjusted EBITDA margins to 25%, and generated positive cash flow from operations for 2023. Additionally, in February 2024, we completed the deferral or retirement of nearly $400 million of debt maturities and now have a clear financial runway to focus on our optimization efforts as we look to capitalize on multiple industry catalysts ahead.
Looking ahead
Ayr said it expects revenue in the first quarter of 2024 to range from flat to modest growth compared to the fourth quarter of 2023, with a continuation of achieving the company’s targets of 25% Adjusted EBITDA margin. The company said it expects gradual improvement from the residual impact of cultivation challenges in Florida, while continuing to build wholesale revenues. AYR expects to further ramp revenue, adjusted EBITDA and operating cash flow later this year.
Goubert added, “The conversion from medical-only to adult-use sales is one of the most significant, proven revenue drivers in any given cannabis market. Currently, only 15 of AYR’s 91 dispensaries operate in adult-use markets, and we are positioning our assets in Florida, Pennsylvania and Ohio to take full advantage of anticipated adult-use transitions. We will not need to materially increase our fixed cost base in these states and expect to generate meaningful operating leverage as revenue growth accelerates in these markets. We remain focused on improving our product quality and consistency, along with our CPG brand portfolio, as we further establish the AYR retail brand and build customer loyalty. With an improved balance sheet, optimized cost structure and impending industry catalysts, we believe AYR is well-positioned to drive sustainable, profitable growth for years to come.”
