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Cannabist Co Holdings Inc. (CBSTF)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue fell to $96.1M, down 16% sequentially on portfolio divestitures (Florida, Eastern Virginia, Arizona); adjusted gross margin was 35.3% (up ~120 bps YoY), and adjusted EBITDA was $7.1M, down from $14.8M in Q3 .
  • Versus Wall Street (S&P Global), Q4 revenue missed ($96.1M actual vs $110.4M consensus*) and EPS missed (-$0.043 actual vs -$0.037 consensus*). Adj. EBITDA also trailed consensus (company-reported Adj. EBITDA $7.05M vs SPGI EBITDA consensus $14.29M*) .
  • Management emphasized a 2025 focus on simplifying the footprint, maintaining liquidity, improving margins, and driving cash flow; capex is expected to average $2–$3M per quarter in 2025, and an agreement to extend senior secured note maturities to Dec-2028 (options to 2029) provides runway .
  • Near-term catalysts include Ohio adult-use adoption and Delaware adult-use transition; New York wholesale conditions improved QoQ, making NY a top-5 market by margin and Adj. EBITDA .

Values with asterisks (*) are retrieved from S&P Global.

What Went Well and What Went Wrong

  • What Went Well

    • Positive operating cash flow ($4.3M) in Q4 and cash balance increased to $33.6M from $31.5M in Q3 .
    • Structural portfolio optimization advanced: closed sale of 14 Florida dispensaries and 2 cultivation facilities; exited non-core assets and achieved $23M in annualized cost savings during 2024 .
    • CEO reiterated 2025 mandate to simplify, maintain liquidity, improve margins, and drive cash flow; highlighted catalysts in Delaware and store additions in Virginia and Ohio (“Our mandate in 2025 is to continue to simplify our business, maintain liquidity, improve margins, and drive cash flow generation… We have meaningful catalysts in 2025, including the transition to adult use in Delaware and the addition of retail locations in top markets such as Virginia and Ohio.”) .

  • What Went Wrong

    • Revenue contracted sequentially (-16%) due to asset sales (Eastern Virginia, Arizona in Q3; Florida in Q4) and market pricing pressure, compressing Adj. EBITDA QoQ (to $7.0M from $14.8M) .
    • Q4 results included a $3.1M provision for credit losses and a $2.1M intangible impairment, contributing to a GAAP net loss of $55.2M .
    • Tax and other items remained a headwind for profitability across 2024; full-year net loss was $174.3M, despite portfolio streamlining and cost reductions .

Financial Results

Key P&L metrics (GAAP unless noted)

MetricQ4 2023Q3 2024Q4 2024
Revenue ($USD Millions)$128.365 $114.783 $96.138
Diluted EPS ($)$(0.18) $(0.004) $(0.12)
Gross Margin % (Adj)34.1% 38.2% 35.3%
Adjusted EBITDA ($USD Millions)$12.472 $14.815 $7.054

Q4 2024 vs Consensus (S&P Global)

MetricQ4 2024 ActualQ4 2024 Consensus*Delta
Revenue ($USD Millions)$96.138 $110.376*Miss
Primary EPS ($)$(0.0428)*$(0.0370)*Miss
EBITDA ($USD Millions)Company Adj. EBITDA $7.054 SPGI EBITDA $14.288*Miss

Values with asterisks (*) are retrieved from S&P Global.

Segment/Mix and KPIs

KPIQ2 2024Q3 2024Q4 2024
Dispensary revenue ($USD Millions)$106.093 $95.223 n/a
Cultivation & wholesale revenue ($USD Millions)$19.097 $19.560 n/a (wholesale was 16% of total)
Wholesale % of total revenuen/an/a16%
Operating cash flow ($USD Millions)n/an/a$4.295
Capex ($USD Millions)n/an/a$1.7
Cash balance ($USD Millions)n/a$31.5 (end Q3) $33.6 (end Q4)
Active retail locations (period-end)n/a73 59

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Capital ExpendituresFY 2025 (quarterly run-rate)Not previously quantifiedExpect $2–$3M per quarter in 2025 Maintained vs 2024 run-rate (as stated “again in 2025”)
Senior Secured Notes MaturityDebt maturity profileFeb-2026 (prior)Agreement to extend maturities to Dec-2028, with options to extend through 2029 (post-quarter) Extended
Retail development2025 buildoutn/a1 store in Virginia and 3 in Ohio under development New detail

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 & Q3 2024)Current Period (Q4 2024)Trend
Footprint optimization / divestituresAnnounced/advanced asset sales (UT closed; AZ & Eastern VA agreements in late July) Florida sale closed Q4; core markets emphasized; store count reduced to 59 Continued consolidation
Pricing/margin dynamicsPrice compression cited; cost controls improved leverage Gross margin 35% (up ~120 bps YoY), sequential down on divestitures and pricing pressure Stabilizing YoY; sequential pressure
Regulatory catalystsAdult-use conversions supportive; monitoring markets Ohio adult-use adoption and Delaware transition flagged as 2025 catalysts Improving setup
New York wholesaleNoted state-level pressures earlier in 2024NY showed largest QoQ Adj. EBITDA increase; top-5 by margin & Adj. EBITDA Improving
Balance sheet / debtOngoing financing and exchanges (2025 converts, 2027 notes) -Agreement to extend senior secured maturities to 2028/29 (post-quarter) De-risking maturities

Call transcript sources: Seeking Alpha transcript and MarketScreener (S&P Capital IQ): https://seekingalpha.com/article/4767268-the-cannabist-company-holdings-inc-cbstf-q4-and-fy2024-earnings-call-transcript | https://www.marketscreener.com/quote/stock/THE-CANNABIST-COMPANY-HOL-120797477/news/Transcript-The-Cannabist-Company-Holdings-Inc-Q4-2024-Earnings-Call-Mar-13-2025-49326222/

Management Commentary

  • “Employing a comprehensive approach to balance sheet management, on February 27, we announced an agreement to extend the maturities on our senior secured debt until December 2028, with options to extend through 2029… This transaction provides runway for us to focus on the continued optimization of our business…” — David Hart, CEO .
  • “Our mandate in 2025 is to continue to simplify our business, maintain liquidity, improve margins, and drive cash flow generation… We have meaningful catalysts in 2025, including the transition to adult use in Delaware and the addition of retail locations in top markets such as Virginia and Ohio.” — David Hart, CEO .
  • Operating execution highlights: positive operating cash flow ($4.3M), capex discipline ($1.7M in Q4), and $23M in annualized cost savings achieved in 2024 .

Q&A Highlights

  • Analysts focused on balance sheet runway and the February agreement to extend senior secured maturities (management reiterated the December 2028 maturity with 2029 options) .
  • State-level growth drivers: timing and magnitude of Ohio and Delaware adult-use benefits, plus store additions in Virginia and Ohio; management positioned these as 2025 catalysts .
  • Margin trajectory post-divestitures and pricing pressure: management noted NY strength and core-market focus, while acknowledging sequential Adj. EBITDA contraction tied to asset sales and pricing .

Estimates Context

  • Revenue missed S&P Global consensus ($96.1M actual vs $110.4M consensus*) and Primary EPS missed (actual -$0.043 vs -$0.037*), reflecting the earnings impact of portfolio sales and market pricing pressure .
  • Company-reported Q4 Adj. EBITDA was $7.1M, below SPGI EBITDA consensus of $14.29M*; management cited the sequential step-down as primarily tied to asset sales and pricing in key markets .

Values with asterisks (*) are retrieved from S&P Global.

Key Takeaways for Investors

  • The core-market focus and cost reductions are improving underlying unit economics (YoY gross margin up ~120 bps), but sequential profitability normalized lower after asset divestitures; watch for stabilization as the streamlined footprint anniversaries .
  • Liquidity/capex discipline remains intact (Q4 OCF $4.3M; capex $1.7M; 2025 capex guide $2–$3M/quarter), providing operational flexibility while pursuing targeted retail additions .
  • Debt maturity extension (post-quarter) meaningfully de-risks near-term refinancing, shifting the narrative toward execution on margin and cash flow in 2025–2026 .
  • State catalysts (Ohio adult-use, Delaware transition; ongoing improvements in NY wholesale) are key to re-accelerating revenue and margin in 2025 .
  • Near-term estimate revisions likely trend lower given Q4 revenue/EPS/EBITDA misses; upside depends on realized benefits from adult-use markets, footprint optimization, and continued cost control .

Sources:

  • Q4/FY 2024 earnings press release and tables (Form 8-K Item 2.02, Exhibit 99.1) .
  • Prior quarters (10-Qs): Q2 2024, Q3 2024 .
  • Company IR press releases: report date and release PDF .
  • Earnings call transcript links: Seeking Alpha and MarketScreener (S&P Capital IQ) .

Notes: All non-GAAP figures (Adjusted EBITDA, Adjusted Gross Margin) follow company definitions and reconciliations in the release -. Values marked with asterisks (*) are retrieved from S&P Global.