urban-gro Signs Approximately $12M in New Cannabis Sector Contracts in the Second Quarter
urban-gro (NASDAQ: UGRO) announced securing approximately $12 million in new contracts within the cannabis sector during Q2 2024. These contracts encompass services like engineering, architecture, design, equipment procurement, and construction management for cultivation and retail dispensary projects. urban-gro expects to recognize most of this revenue by the end of Q3 2024. CEO Bradley Nattrass cited positive cannabis sector momentum, partly due to regulatory developments and upcoming votes on adult-use cannabis in Florida, as key drivers. The company has been optimizing its multi-sector strategy and infrastructure over the past two years to better meet anticipated demand.
- urban-gro secured $12 million in new contracts in Q2 2024.
- The contracts span engineering, architecture, design, equipment procurement, and construction management.
- The company expects to recognize most of this revenue by the end of Q3 2024.
- None.
Insights
Urban-gro's announcement of $12 million in new cannabis sector contracts indicates a significant boost in its revenue pipeline for the upcoming quarters. This is particularly relevant given the past struggles in the cannabis market. The company expects to recognize most of this revenue by the end of Q3 2024, which means investors can anticipate an upbeat earnings report in the near term. This uptick may be due to the company's strategic diversification and leaner infrastructure, which can enhance profitability.
Short-term implications could mean a potential rise in the stock price as the market responds to this positive news. In the long-term, if the cannabis market continues its recovery, urban-gro could see sustained growth. However, investors should monitor cannabis sector volatility and regulatory changes closely, as these can significantly affect future revenue streams.
From a market perspective, urban-gro's new contracts underscore a growing demand for professional services in the cannabis sector, likely fueled by favorable regulatory shifts and increasing consumer acceptance. The mention of developments such as the potential rescheduling of cannabis and the upcoming vote on adult-use cannabis in Florida points to a broader trend of legalization, which could open up new markets and opportunities.
The company's ability to secure contracts with over a dozen clients suggests strong industry relationships and a competitive edge. This positions urban-gro well as a leader in providing integrated solutions for cannabis cultivation and retail sectors. Future growth will depend on how well the company leverages these relationships and navigates the evolving regulatory landscape.
Urban-gro's CEO referenced positive regulatory developments, such as the rescheduling of cannabis and the vote on adult-use cannabis in Florida. These are critical factors that can influence the company's business environment. Rescheduling cannabis could lead to fewer federal restrictions, potentially simplifying operations and expanding market opportunities. It’s essential for investors to understand that while these regulatory changes offer significant upside, they also come with uncertainties and risks.
Given urban-gro’s diversified approach across multiple sectors, they appear well-prepared to mitigate risks associated with regulatory delays or adverse decisions. The strategic emphasis on a leaner infrastructure further positions them to adapt quickly to any regulatory changes.
LAFAYETTE, CO / ACCESSWIRE / June 26, 2024 / urban-gro, Inc. (NASDAQ:UGRO) ("urban-gro" or the "Company"), an integrated professional services and Design-Build firm offering solutions to the Controlled Environment Agriculture ("CEA") and commercial sectors, today announced that the Company has signed multiple new contracts with more than a dozen clients in the cannabis sector, with aggregate expected contract revenue totaling approximately
"We are encouraged by the momentum in the cannabis sector, which we believe is partly due to positive developments related to rescheduling and the upcoming vote on adult-use cannabis in Florida," said Bradley Nattrass, Chairman and CEO. "While the cannabis sector is still recovering from this last downward cycle, we have worked diligently over the past two years to optimize our multi-sector diversification strategy with a leaner and more efficient infrastructure. With our unmatched industry experience, our professional services team is well positioned to meet the anticipated acceleration in demand for our custom cannabis sector solutions."
About urban-gro, Inc.
urban-gro, Inc.® (Nasdaq: UGRO) is an integrated professional services and Design-Build firm. We offer value-added architectural, engineering, and construction management solutions to the Controlled Environment Agriculture ("CEA"), industrial, healthcare, and other commercial sectors. Innovation, collaboration, and creativity drive our team to provide exceptional customer experiences. With offices across North America and in Europe, we deliver Your Vision - Built. Learn more by visiting www.urban-gro.com.
Safe Harbor Statement
This press release contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this release, terms such as "believes," "will," "expects," "anticipates," "may," "projects" and similar expressions and variations as they relate to the Company or its management are intended to identify forward-looking statements. The forward-looking statements in this press release include, without limitation, statements relating to anticipated increased demand for the Company's services, federal rescheduling of cannabis, approval of adult use cannabis in Florida, the Company's ability to realize revenue from new contracts, and the timing and amount of such revenue. These and other forward-looking statements are based on current expectations, forecasts, and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially from those anticipated or expected, including, among others, our ability to successfully manage and integrate acquisitions, our ability to accurately forecast revenues and costs, competition for projects in our markets, our ability to predict and respond to new laws and governmental regulatory actions, including delays granting licenses to clients or potential clients and delays in passage of legislation expected to benefit our clients or potential clients, our ability to successfully develop new and/or enhancements to our product offerings and develop a product mix to meet demand, risks related to adverse weather conditions, supply chain issues, rising interest rates, economic downturn or other factors that could cause delays or the cancellation of projects in our backlog or our ability to secure future projects, our ability to maintain favorable relationships with suppliers, risks associated with reliance on key customers and suppliers, our ability to attract and retain key personnel, the creditworthiness of our customers, results of litigation and other claims and insurance coverage issues, risks related to our information technology systems and infrastructure, our ability to maintain effective internal controls, our ability to execute on our strategic plans, our ability to achieve and maintain cost savings, and the sufficiency of our liquidity and capital resources. A more detailed description of these and certain other factors that could affect actual results is included in the Company's most recent Annual Report on Form 10-K and its other filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date hereof, except as may be required by law.
Investor Contacts:
Dan Droller - urban-gro, Inc.
-or-
Jeff Sonnek - ICR, Inc.
(720) 730-8160
investors@urban-gro.com
Media Contact:
Barbara Graham - urban-gro, Inc.
(720) 903-1139
media@urban-gro.com
SOURCE: urban-gro, Inc.
View the original press release on accesswire.com
FAQ
What new contracts did urban-gro (UGRO) sign in Q2 2024?
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When does urban-gro expect to recognize revenue from its new $12 million cannabis contracts?
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