StateHouse Reports Significant Growth in Q2 2024 Financials
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StateHouse Reports Second Quarter 2024 Financial Results
Q2 2024 Net Revenue increased by 10% to $27.8 Million, Gross Margin strong at 50.8%
Positive Net Income of $0.2 Million and Adjusted EBITDA of $4.9 Million achieved in Q2 2024
SAN DIEGO and TORONTO – StateHouse Holdings Inc. (“StateHouse” or the “Company”) (CSE: STHZ) (OTCQB: STHZF), a California-focused, vertically integrated cannabis company, today announced its financial results for the three-month period ended June 30, 2024 (“Q2 2024”), along with additional business updates. The unaudited condensed interim consolidated financial statements for Q2 2024, along with the corresponding management’s discussion and analysis, will be available for download from the Company’s investor website. All dollar amounts in this report are in U.S. currency.
Q2 2024 Financial Highlights
Key Metrics
- Q2 2024 net revenues increased 10% to $27.8 million, compared to $25.3 million in Q2 2023.
- Retail revenues totaled $13.5 million, representing 48.5% of total sales for Q2 2024.
- Branded wholesale and manufacturing revenues were $10.7 million, making up 38.5% of total sales for Q2 2024.
- Cultivation revenues reached $3.6 million, contributing 12.9% of total sales in Q2 2024.
- Gross profit before adjustments was $14.1 million in Q2 2024, compared to $12.3 million in Q2 2023.
- Consolidated adjusted gross margins improved to 50.8% in Q2 2024 from 48.6% in the prior year.
- Net income for Q2 2024 was $0.2 million, in contrast to a net loss of $2.1 million in Q2 2023.
- Adjusted EBITDA improved to $4.9 million in Q2 2024, compared with $0.9 million in Q2 2023.
Management Commentary
“Progress throughout the quarter has been significant, driven by our innovative product lines that are enhancing both growth and profitability,” said Ed Schmults, Chief Executive Officer of StateHouse. “Transactions increased by 14% compared to the same period last year, demonstrating consumer demand for our products. Our adjusted gross margin is now 50.8%, net income stands at $0.2 million, and Adjusted EBITDA is $4.9 million, thanks in part to our cost-saving initiatives and the launch of over 24 new high-margin products in the past year.”
Mr. Schmults added, “By balancing our operating expenses while enhancing our product mix, we are witnessing strong operational performance. The positive feedback from customers reaffirms our commitment to meeting evolving consumer needs in the cannabis sector. We are poised to maintain this momentum as we navigate the ever-expanding cannabis market.”
Brands and Product Highlights
New Innovations
- The Company has launched 24 new products across 7 brands, along with over 40 in-house developed strain formulations, which represent about 15% of year-to-date sales for 2024.
- StateHouse's sales team has enhanced product lines for better visual merchandising, including the introduction of the new Dime Bag Cartridge and All-In-One hardware, which is currently the leading vape product line.
- The latest farm product offerings for young plant sales—including cuttings, clones, and teens—are performing exceptionally well, with a sales increase of over 10X since their launch.
Operations Update
Overall Q2 2024 revenue reached $27.7 million, a rise of 3.6% from Q2 2023, largely due to a 14% increase in transactions. The gross profit before biological asset adjustments was strong at $14.1 million, representing 50.8% of total revenues.
The Company’s retail strategy has effectively increased customer traffic by 18%, with new customer visits growing by 9% for the first half of 2024 compared to the previous year. The STASH loyalty program has surpassed 316,291 members as of late August, while online sales rose by 17% in the first half of 2024. Notably, Buy Online, Pickup in Store (BOPIS) sales have more than doubled during this period.
Cultivation revenue for the second quarter saw a remarkable increase of 203.5% over the same timeframe last year. This is a result of improvements in yield and high-quality product output, driven by the successful installation of supplemental CO2 in all flowering ranges in Q2 2024. Ongoing cultivation innovations, including trials with new lighting approaches, are expected to further enhance yields.
The Company's management is proactively developing strategies to strengthen its financial position while engaging with lenders to restructure its debt obligations.
About StateHouse Holdings Inc.
StateHouse is a leading vertically integrated cannabis enterprise with licenses spanning retail, major brands, distribution, cultivation, nursery, and manufacturing. Founded in 2006, as Harborside, it was one of the first to receive a medical cannabis license in the United States. The Company operates 11 dispensaries across California and has established a strong reputation in the cannabis market, providing a wide range of products under various brands to over 700 retailers.
The Company is publicly traded under the ticker symbols CSE: STHZ and OTCQB: STHZF. StateHouse remains dedicated to making cannabis safe and accessible for a diverse community of consumers.
Frequently Asked Questions
What are the main highlights of StateHouse's Q2 2024 results?
StateHouse reported a 10% increase in net revenue to $27.8 million, a positive net income of $0.2 million, and Adjusted EBITDA of $4.9 million.
How did the revenue distribution break down across product lines?
Retail revenues contributed $13.5 million, branded wholesale and manufacturing revenues accounted for $10.7 million, and cultivation revenues were $3.6 million.
What strategies has StateHouse implemented to achieve Its growth?
The Company emphasized product innovation, cost-saving measures, enhanced retail strategies, and a robust loyalty program to boost customer engagement and sales.
What future plans does StateHouse have following these results?
StateHouse aims to continue expanding its product offerings and improving operational efficiencies while actively exploring opportunities to strengthen its financial position.
Where can I find more information about StateHouse Holdings Inc.?
Further information can be found on the Company’s official website and through its investor relations channels.
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