Key Takeaways; Cannabis Sector
- Aurora announced the repurchase of convertible senior notes worth approximately $47 million, saving the company $2.6 million in annualized interest payments.
- Jushi Holdings reported preliminary Q4 and record full year 2022 financial results.
- Curaleaf announced $20 million acquisition in
Key Takeaways; Psychedelic Sector
- Awakn’s proprietary treatment protocol for alcohol use disorder was used for the first time in New York City.
- ATAI showed signs of stability in its Q4 and full year 2022 financial results.
In recent weeks, many companies in the cannabis and psychedelics sectors have reported their earnings for the past quarter, giving investors a better understanding of their performance and the overall health of the industry. In this weekly round-up, we will take a closer look at the latest news and developments in the cannabis and psychedelics sectors, including the performance of some of the big players in the industry.
Top Marijuana Companies for Week
#1: Aurora
Aurora Cannabis Inc. (NASDAQ: ACB), a Canadian cannabis company, recently announced that it has bought back $47 million worth of convertible notes. According to the company, the notes were repurchased at a 2.5% discount to par value and will help to reduce the company’s debt and annual cash interest costs. Aurora also stated that this move will save the company $2.6 million in annualized interest payments.
Aurora has repurchased approximately $366 million worth of its convertible senior notes since December 2021, which is expected to result in an annual cash interest savings of around $20 million.
Despite the repurchase of these notes, Aurora said that its balance sheet remains one of the strongest in the Canadian cannabis industry, which is partly due to the company’s focus on profitable growth in both global medical and Canadian adult use markets. Aurora recently achieved the goal of Adjusted EBITDA profitability for the quarter ended December 31, 2022, which is a significant achievement for the company.
According to the company, this move to reduce annualized interest payments is a strategic decision that highlights its commitment to financial discipline. The company added that its strong balance sheet will help to ensure that it remains competitive within the industry and that it has the financial resources necessary to continue to grow and expand.
#2: Jushi Holdings
Jushi Holdings Inc. (OTC: JUSHF), a leading cannabis and hemp company that operates in multiple states across the United States, recently reported its unaudited preliminary fourth-quarter and full-year 2022 financial results, which show strong growth in both revenue and adjusted EBITDA.
For the fourth quarter of 2022, Jushi reported revenue of $76.8 million, which represents a 5.5% increase from the previous quarter and a 16.6% increase from the same quarter in the previous year. Adjusted EBITDA for the quarter was $6.0 million.
For the full year 2022, Jushi reported record revenue of $284.3 million, which represents a 35.8% increase from the previous year. Adjusted EBITDA for the year was $7.1 million.
The company stated that it had solidified its retail network with seven new store openings, bringing its total number of operational dispensaries nationwide to 35. Jushi Holdings also said that it had strengthened its Board of Directors and senior leadership by appointing Bill Wafford as an Independent Director and Chair of the Audit Committee, and Tobi Lebowitz to Chief Legal Officer and Corporate Secretary. The company also announced that it expects to move to a new labor model resulting in a total estimated 50% labor hour savings since April of 2022.
#3: Curaleaf
Curaleaf Holdings, Inc. (OTC: CURLF), a leading cannabis retailer in the United States, recently announced that had acquired Deseret Wellness, a Utah-based cannabis retail operator, for approximately $20 million. The acquisition includes three retail dispensaries located in Park City, Payson, and Provo, with a combined annual revenue run rate of $14 million.
Curaleaf’s CEO, Matt Darin, stated that Utah has become an “important emerging market” for the company, and the acquisition strengthens its retail footprint in the state.
Utah’s medical marijuana program has faced criticism for its high cost and complex regulations, but sales have increased by nearly 60% from 2021 to 2022, according to the Utah Department of Health and Human Services’ Center for Medical Cannabis. Persistent pain and post-traumatic stress disorder are the most common qualifying conditions for medical cannabis in Utah, and the number of active registered patients has grown by 51% from Oct. 1, 2021, to Sept. 30, 2022, according to the Center’s 2022 annual report.
Curaleaf’s acquisition of Deseret Wellness highlights the company’s commitment to key markets and its continued expansion in the cannabis industry.
Top Psychedelic Companies for Week
#1: Awakn
Awakn Life Sciences Corp. (OTC: AWKNF) is a leading biotechnology company that specializes in the development of psychedelic medicines for the treatment of various mental health conditions. Recently, the company’s proprietary treatment protocol, Awakn Kare, was used for the first time in New York City by their U.S. licensing partner, Nushama Wellness, to treat alcohol use disorder.
Awakn Kare is a holistic treatment program that combines evidence-based therapies such as cognitive-behavioral therapy (CBT), motivational interviewing (MI), and mindfulness practices with the use of psychedelic-assisted therapies. The program aims to address the root causes of addiction by providing patients with a safe and supportive environment to explore and process their underlying issues.
The use of Awakn Kare in New York City represents an important milestone for Awakn and the field of psychedelic-assisted therapy more broadly. As the use of these therapies becomes more mainstream, it is likely that we will see more treatment programs like Awakn Kare emerge, offering patients new and innovative options for addressing their mental health and addiction issues.
#2: Atai
Atai Life Sciences N.V. (NASDAQ: ATAI), a clinical-stage biopharmaceutical firm, recently released its fourth quarter and full year 2022 financial results. Despite reporting losses of $45 million in the last quarter and $152.4 million in 2022, the company showed signs of stability and progress in its financials, with increased investment in its core psychedelic research and reduced overall expenses.
Atai’s research and development costs rose by $26.3 million in 2022, mainly due to hiring outside organizations and an increase in staff working on research projects. Conversely, general and administrative expenses, including office costs and employee salaries, decreased by $22.3 million compared to the previous year, primarily due to lower stock-related costs, smaller taxes, and less money spent on consultants.
In addition, the company recently underwent a round of layoffs, cutting approximately 30% of its workforce, to reallocate capital toward funding near-term projects and reduce overheads.
Atai’s CEO and co-founder, Florian Brand, expressed optimism about the company’s execution capabilities and the advancement of programs into later-stage clinical studies. The company also announced that it is still working on several new treatments for mental health disorders, including drugs for schizophrenia, anxiety, depression, opioid addiction, and PTSD.