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Planet 13 Holdings Inc. (PLNH)·Q4 2024 Earnings Summary
Executive Summary
- Q4 2024 revenue was $30.3M, below S&P Global consensus of $32.2M*, with gross margin compressing to 43.2% and Adjusted EBITDA at breakeven; net loss was $26.4M including a non‑cash impairment of $18.9M . S&P Global consensus revenue for Q4 2024 was $32.2M*, versus actual of $30.3M .
- Sequentially, revenue declined from $32.2M in Q3 and gross margin fell from 51.9% to 43.2% due to industry price compression and targeted discounting in Florida .
- Management highlighted 2025 execution priorities: $3–5M capex for targeted Florida manufacturing upgrades and additional store openings, debt paydown (~$3.3M bank debt repaid in Feb 2025), and ~$2.1M additional cash recovery in March (total ~$10.5M including real property) tied to the El Capitan matter
- Q4 catalysts included Florida footprint expansion (Port Orange Oct 15, Gulf Breeze Dec 18, Panama City Dec 26) and call commentary on pricing headwinds and illicit/hemp competition; press coverage noted the stock dipped around the release
What Went Well and What Went Wrong
What Went Well
- Revenue grew 31.8% YoY to $30.3M, with Florida driving growth; gross profit rose 19.2% YoY to $13.1M .
- Balance sheet strengthened: cash rose to $25.4M, total assets to $206.7M; Planet 13 operated 30 Florida dispensaries and 34 locations nationwide by year‑end .
- Management emphasized disciplined execution and efficiency initiatives: “We are taking decisive steps to enhance per‑store performance, optimize retail and wholesale operations, and streamline corporate costs…” — Co‑CEO Bob Groesbeck .
What Went Wrong
- Gross margin compressed to 43.2% (from 51.9% in Q3) due to industry price compression and targeted discounting in Florida; Adjusted EBITDA declined to $0.0M vs $1.3M in Q3 .
- Non‑cash impairment of $18.9M drove operating expenses higher (Q4 opex $35.8M vs $18.1M YoY) and widened net loss to $26.4M .
- Management cautioned on continued pricing headwinds and competition from illicit markets and intoxicating hemp in CA/NV/FL, impacting top‑line and margins .
Financial Results
Quarterly Comparison (oldest → newest)
Q4 2024 Actual vs S&P Global Consensus
Values with asterisk retrieved from S&P Global.
Segment/Channel Indicators
KPIs
Guidance Changes
Earnings Call Themes & Trends
Management Commentary
- “In 2024, despite industry‑wide price compression, we remained disciplined in executing our key priorities—expanding our retail footprint, scaling operations, and strengthening our product portfolio and brand equity.” — Larry Scheffler, Co‑CEO .
- “As we move into 2025, our focus is on maximizing productivity and efficiency across our footprint… streamlin[ing] corporate costs—all with a clear goal of strengthening margins.” — Bob Groesbeck, Co‑CEO .
- CFO commentary: unrestricted cash was $23.4M at year‑end; ~$1.4M used in Q4 operating cash flow; $3–5M capex planned; ~$3.3M bank debt paid off; additional $2.1M recovered and ~$5M real property, totaling ~$10.5M related to El Capitan .
Q&A Highlights
- Analysts probed Florida pricing and margin outlook; management reiterated headwinds from illicit/hemp competition and focus on differentiation via product quality and brand positioning .
- Capex prioritization: targeted manufacturing upgrades and selective store openings in Florida to improve per‑store productivity .
- Liquidity actions: debt paydown and cash recoveries tied to El Capitan to bolster flexibility; notes payable timing (Apr 1) discussed .
- Tone vs prior quarters: more cautious on near‑term pricing/margins but confident in long‑term positioning and operational improvements .
Estimates Context
- Q4 2024 revenue missed S&P Global consensus ($30.3M actual vs $32.2M*), while EBITDA was negative vs a modest positive consensus (actual $(2.5)M vs $0.7M*) .
- With gross margin down to 43.2% and management signalling ongoing pricing pressure, Street EBITDA and margin assumptions likely need to drift lower near‑term to reflect Florida discounting and the competitive backdrop .
Values with asterisk retrieved from S&P Global.
Key Takeaways for Investors
- Florida expansion remains the top growth lever, but near‑term margin pressure from price compression and discounting is a central risk to profitability .
- Execution pivot to productivity: watch capex deployment ($3–5M) and per‑store metrics in Florida for operating leverage restoration .
- Liquidity improving: debt reduction and ~$10.5M total recovery tied to El Capitan support flexibility; monitor timing of asset sale proceeds and remaining legal recovery .
- Near‑term trading: absent formal revenue/margin guidance and with margin compression, risk‑reward skews to headlines (pricing, regulatory progress in FL, illicit/hemp enforcement) and cadence of cost actions .
- Medium‑term thesis: scaled FL network plus brand partnerships (e.g., Khalifa Kush in NV) and entertainment‑driven retail experiences (DAZED!) provide differentiation once pricing normalizes .
- Watch retail mix and gross margin trajectory; sequential improvement from Q4 lows would be an early signal that discounting is abating and cultivation upgrades are paying off .
- Corporate cost discipline and operating efficiency programs are central to restoring Adjusted EBITDA; track quarterly opex and non‑cash charges .
Values with asterisk retrieved from S&P Global.