Trulieve Completes Acquisition of Harvest Health & Recreation Inc. Creating the Largest and Most Profitable U.S. Cannabis Operator
Combined Company Platform Poised for Accelerated Growth
Industry Leading Footprint in Cornerstone Markets
Expanded Runway for Growth in Northeast, Southeast, and Southwest Strategic Hubs
TALLAHASSEE, Fla. and
Key Transaction Highlights and Benefits
- Increases Scale Across Our Hub Markets – creates at time of closing the largest
U.S. cannabis operator across a combined retail and cultivation footprint basis with depth in key markets; - Solidifies Position as the Most Profitable
U.S. MSOs – establishes an outstanding platform of profitability and cash generation for continued growth, positioning the Company to execute on near-term opportunities in existing markets as well as future catalysts at both state and federal levels; - Provides Leading Financial Metrics – reinforces superior financial performance relative to peers by delivering the strongest public company financial results among any
U.S. reporting MSO. In the second quarter 2021,Trulieve reported revenues of$215.1 million , net income of$40.9 million , and Adjusted EBITDA1 of$94.9 million , and Harvest reported revenues of$102.5 million , net loss before non-controlling interest of$19.2 million , and Adjusted EBITDA2 of$28.0 million . On a combined basis, in the second quarter 2021,Trulieve and Harvest had$317.6 million in reported revenue, the highest amongU.S. public reporting cannabis companies; - Delivers an Exceptional Retail and Wholesale Distribution Model – offers a robust retail network of 149 dispensaries across 11 states and 3 strategic regional hubs, with market leading positions in
Arizona ,Florida andPennsylvania ; - Strengthens Industry Leading Balance Sheet – combines
Trulieve and Harvest's strong cash and cash equivalents of$289.0 million and$71.0 million , respectively, as ofJune 30, 2021 , bolstered byTrulieve's recently announced$350.0 million debt financing and Harvest's$55.0 million proceeds from the sale of itsFlorida license; - Extends Product Selection and Brands – adds successful line of Harvest brands, including Alchemy and Roll One, across multiple form factors to
Trulieve's portfolio of in-house brands and national brand partners; and - Leverages Experience and Best Practices – combines proven management teams with established track records, enhancing operational excellence across cultivation, manufacturing, and retail.
Management Commentary
"The closing of this Transaction marks a transformational milestone in our company's history and positions
"This combination brings together two companies with depth and scale in key markets, providing a platform for growth for years to come," said Steve White, CEO of Harvest. "
Transaction Details
The Transaction was completed by way of a plan of arrangement (the "Arrangement") under the provisions of the Business Corporations Act (
It is anticipated that the subordinate voting shares of Harvest will be delisted from the Canadian Securities Exchange as of the close of trading on
Pursuant to the letter of transmittal mailed to shareholders of Harvest as part of the materials delivered in connection with the annual and special meeting of Harvest shareholders held on
For more information on the Arrangement, please see the news releases previously issued by
Financial and
Conference Call and Investor Presentation
Trulieve will hold a conference call and webcast to discuss the completion of the Transaction today at 8:00 AM EDT. The conference call may be accessed by dialing 1-855-669-9657 and entering conference ID 10160599. Access to the webcast will be available at Trulieve.com or Trulieve Acquires Harvest Webcast Call. In addition, an accompanying investor presentation will be available on the Investor Relations Events & Presentations page on the
About Trulieve
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The Canadian Securities Exchange has not reviewed, approved or disapproved the content of this news release.
Forward-Looking Statements
This news release includes forward-looking information and statements, which may include, but are not limited to, information and statements regarding or inferring the future business, operations, financial performance, prospects, and other plans, intentions, expectations, estimates, and beliefs of the Company. Words such as "expects", "continue", "will", "anticipates" and "intends" or similar expressions are intended to identify forward-looking statements. Such statements include, but are not limited to, statements about the benefits of the acquisition of Harvest, the integration of the two businesses, and our plans, objectives, expectations, and intentions with respect to future operations, products and services. These forward-looking statements are based on the Company's current projections and expectations about future events and financial trends that management believes might affect its financial condition, results of operations, business strategy and financial needs, and on certain assumptions and analysis made by the Company in light of the experience and perception of historical trends, current conditions and expected future developments and other factors management believes are appropriate. Forward-looking information and statements involve and are subject to assumptions and known and unknown risks, uncertainties, and other factors which may cause actual events, results, performance, or achievements of the Company to be materially different from future events, results, performance, and achievements expressed or implied by forward-looking information and statements herein, including, without limitation, the risks discussed under the heading "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2020 and in subsequent periodic and current reports filed with the United States Securities and Exchange Commission and in the Company's filings on SEDAR at www.sedar.com. Although the Company believes that any forward-looking information and statements herein are reasonable, in light of the use of assumptions and the significant risks and uncertainties inherent in such information and statements, there can be no assurance that any such forward-looking information and statements will prove to be accurate, and accordingly readers are advised to rely on their own evaluation of such risks and uncertainties and should not place undue reliance upon such forward-looking information and statements. Any forward-looking information and statements herein are made as of the date hereof, and except as required by applicable laws, the Company assumes no obligation and disclaims any intention to update or revise any forward-looking information and statements herein or to update the reasons that actual events or results could or do differ from those projected in any forward looking information and statements herein, whether as a result of new information, future events or results, or otherwise, except as required by applicable laws.
Footnote 1
This reflects the Adjusted EBITDA of
Footnote 2
This reflects the Adjusted EBITDA of Harvest for the fiscal quarter ended
For the three months ended |
|||||
(Amounts expressed in thousands of |
2021 |
2020 |
|||
Net loss (GAAP) before non-controlling interest |
$ |
(19,229) |
$ |
(25,645) |
|
Add (deduct) impact of: |
|||||
Net interest and other financing costs(1) |
9,184 |
9,390 |
|||
Income tax |
6,834 |
1,132 |
|||
Amortization and depreciation(2) |
3,532 |
1,803 |
|||
Loss on sale of assets |
21 |
2,783 |
|||
Fair value of liability adjustment |
8,353 |
1,497 |
|||
Fair value of contingent consideration |
4,500 |
— |
|||
Other income |
(269) |
(1,205) |
|||
Foreign currency gain |
(17) |
(30) |
|||
Share-based compensation expense |
3,741 |
3,276 |
|||
Contract asset impairment |
— |
2,420 |
|||
Discontinued operations, net of tax |
1,954 |
905 |
|||
Other expansion expenses (pre-open) |
3,371 |
2,323 |
|||
Transaction & other special charges |
6,047 |
956 |
|||
Adjusted EBITDA (non-GAAP) |
$ |
28,022 |
$ |
(395) |
|
(1) Includes less than |
|||||
(2) Includes |
SOURCE