Verano Holdings to buy back $50M in shares

Chicago-based Verano Holdings Corp. (OTCQX: VRNOF) announced Monday that its Board of Directors authorized a share repurchase program of up to $50 million of the company’s Class A subordinate voting shares.

The move allows Verano to buy back its own stock, which the company believes is undervalued in the market. Verano said it plans to buy shares over a 12-month period, ending June 13, 2025, or when it reaches the $50 million limit.

“The authorization of our first-ever share repurchase program provides an additional outlet for capital deployment alongside other measures such as capital expenditures, strengthening our balance sheet, and potential M&A as we position Verano for long-term growth and success,” chairman and CEO George Archos said in a statement. “Going forward, we will be opportunistic in identifying market dislocations to support the stock and return cash to shareholders.”

The company is allowed to buy up to 17,320,857 shares, representing 5% of its outstanding shares when the program was approved.

Verano said its decision to buy back its own stock is based on factors such as “its historical and expected business performance and cash and liquidity position, global economic and market conditions, and the market price of the company’s common stock.”

Last month, the firm reported flat first-quarter revenue of $221 million, a 3% downtick from the same period last year. Despite that, the company beat analyst expectations by $5 million.

The company also reported net cash provided by operating activities of $31 million, up nearly 50% from the first quarter of 2023. The rise was mainly driven by a decrease in income tax payments, the company said in regulatory filings.

Verano ended the quarter with a cash position of $193.8 million, up from $174.8 million at the end of 2023. The company’s working capital also rose by $21.8 million to $3.8 million.

Verano operates in 13 U.S. states, with 14 production facilities and over 1,000,000 square feet of cultivation capacity. The company provides cannabis products through its retail brands, including Zen Leaf and MÜV dispensaries.