Verano Confirms Filing of Reviewed First Quarter 2022 Financials

Rhea-AI Summary

Verano Holdings Corp. (CSE: VRNO) (OTCQX: VRNOF) confirmed the filing of its reviewed first quarter 2022 financial statements on June 17, 2022, which amend previously filed statements. Key highlights include a Free Cash Flow of -$13.8 million due to $48.3 million in capital expenditures and Adjusted EBITDA of $80.8 million. The company's cash position remains unchanged at $140 million. Verano emphasizes the use of non-GAAP measures for performance evaluation, which are not standardized and may differ from similar metrics of other companies.

Positive

• Adjusted EBITDA for Q1 2022 is $80.8 million, indicating strong operational performance.
• The cash position remains solid at $140 million, providing liquidity for operations.

Negative

• Free Cash Flow is reported at -$13.8 million, reflecting significant capital expenditures.
• Net income shows a loss of $10.1 million for the first quarter.

CHICAGO, June 22, 2022 (GLOBE NEWSWIRE) -- Verano Holdings Corp. (CSE: VRNO) (OTCQX: VRNOF) (“Verano” or the “Company”), a leading multi-state cannabis company, today is confirming that on June 17, 2022 it filed its first quarter 2022 financial statements on SEDAR that have been reviewed by its outside auditor, which replace the previously filed first quarter 2022 financial statements filed on SEDAR on May 25, 2022. The reviewed 2022 first quarter financial statements were also included in the Company’s amended Form 10 registration statement filed concurrently with the U.S. Securities and Exchange Commission.

Based on the reviewed 2022 first quarter reviewed financial statements, the Company is clarifying that the non-GAAP financial measure Free Cash Flow¹ of $6 million disclosed in its May 25, 2022 earnings release included approximately $20 million of cash flow from investments. In addition, although its previously disclosed non-GAAP financial measure Adjusted EBITDA² remained unchanged at $81 million, a reconciliation line item has been modified to reflect a currency exchange difference in “other income (expense), net.” The calculations of Free Cash Flow¹ and Adjusted EBITDA² and their reconciliation to the most comparable U.S. GAAP financial metrics are included in the tables below.

Corresponding changes to cash provided by operations and net cash used in investing activtites were included in the reviewed 2022 first quarter financial statements. These changes had no impact on the reported net increase in cash and the Company’s cash position remains unchanged with a balance of $140 million as of the March 31, 2022 quarter end.

Non-GAAP Financial Measures

Verano uses non-GAAP financial information to evaluate the performance of the Company. The terms “EBITDA”, “Adjusted EBITDA” and “Free Cash Flow” do not have any standardized meaning prescribed within U.S. GAAP and therefore may not be comparable to similar measures presented by other companies. Accordingly, this non-U.S. GAAP financial information is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with U.S. GAAP.

For the first quarter of 2022, the Company calculated EBITDA as net earnings from operations before interest expense, tax expense, depreciation, and amortization and Adjusted EBITDA as EBITDA as adjusted for one-time expenses related to other expenses, gain from investment in associates and acquisition related costs. Free Cash Flow has been calculated by the Company as cash flow from operations minus capital expenditures. The calculations of the non-GAAP financial information used in this news release and the reconciliations to the most comparable U.S. GAAP financial numbers are included in the tables below. 

Management believes that this non-GAAP financial information is useful as a supplement to comparable U.S. GAAP financial information. Management reviews these non-GAAP financial measures on a regular basis and uses them, together with financial measures included in the Company’s financial statements, to evaluate and manage the performance of the Company’s operations. These measures should be evaluated only in conjunction with the comparable U.S. GAAP financial measures reported by the Company.

About Verano

Verano is a leading, vertically integrated, multi-state cannabis operator in the U.S., devoted to the ongoing improvement of communal wellness by providing responsible access to regulated cannabis products. With a mission to address vital health and wellness needs, Verano produces a comprehensive suite of premium, innovative cannabis products sold under its trusted portfolio of consumer brands, including Verano^™, Avexia^™, Encore^™, and MÜV^™. Verano’s portfolio encompasses 14 U.S. states, with active operations in 13, including 13 production facilities comprising over 1,000,000 square feet of cultivation capacity. Verano designs, builds, and operates dispensaries under retail brands including Zen Leaf^™ and MÜV^™, delivering a superior cannabis shopping experience in both medical and adult-use markets. Learn more at www.verano.com.

Contacts:

Media
Verano
Grace Bondy
Manager, Communications
Grace.Bondy@verano.com
517-672-8001

Investors
Verano
Julianna Paterra, CFA
Director, Investor Relations
investors@verano.com

Forward Looking Statements

This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only the Company’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Company's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", “future”, "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". The forward-looking information and forward-looking statements contained herein include, but are not limited to, statements or information with respect to the Company’s operations. 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 risk factors discussed in the Company's publicly available filings on SEDAR at www.sedar.com. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake to update any forward-looking information or forward-looking statements that are contained or referenced herein, except as may be required in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to the Company or persons acting on its behalf is expressly qualified in its entirety by this notice regarding forward-looking information and statements.

Financial Information Tables

The following tables set forth financial information derived from the first quarter 2022 consolidated financial statements of the Company prepared in accordance with U.S. GAAP and audited in accordance with U.S. PCAOB, which consolidated financial statements are included in the U.S. Registration Statement filed with the SEC and available at www.sec.gov. (Collectively, the “U.S. Financial Statements”).

Verano Holdings Corp.
Unaudited Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Non-GAAP)
($ in thousands)	For the Three Months Ended
	3/31/22				3/31/21
	(Unaudited)				(Unaudited)
Net Cash Provided by Operating Activities	$	34,457			$	24,831
Purchase of property, plant, and equipment		(48,300	)			(36,402	)
Free Cash Flow	$	(13,843	)		$	(11,571	)

Verano Holdings Corp.
Unaudited Reconciliation of Net Income to Adjusted EBITDA (Non-GAAP)
($ in thousands)	For the Three Months Ended
	3/31/22				3/31/21
	(Unaudited)				(Unaudited)
Net Income1	$	(10,131	)		$	(2,194	)
Depreciation and Amortization		34,434				11,783
Interest Expense, Net		10,672				1,767
Income Tax Expense		42,833				16,414
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)	$	77,808			$	27,770
Other expense (income), net		(14,145	)			800
Acquisition, transaction, and other non-operating costs		17,153				32,231
Adjusted EBITDA	$	80,816			$	60,801
1 Net Income excludes amounts attributable to non-controlling interest.

###

¹ Free Cashflow is a non-GAAP financial measure and is defined in this news release in the section below titled “Non-GAAP Financial Measures.” The most comparable U.S. GAAP financial measure is cash flow from operations. The reconciliations of Free Cash Flow to U.S. GAAP cash flow from operations is set forth below in the tables included in this news release.
² Adjusted EBITDA is a non-GAAP financial measure. It is derived from EBITDA, another non-GAAP financial measure, both of which are defined in this news release in the section below titled “Non-GAAP Financial Measures.” The most comparable U.S. GAAP financial measure to Adjusted EBITDA and EBITDA is net income. The reconciliations of Adjusted EBITDA and EBITDA to U.S. GAAP net income is set forth below in the tables included in this news release. 

FAQ

What is Verano Holdings Corp.'s Free Cash Flow for Q1 2022?

Verano's Free Cash Flow for Q1 2022 is -$13.8 million.

What was the Adjusted EBITDA for Verano Holdings in the first quarter of 2022?

Verano Holdings reported an Adjusted EBITDA of $80.8 million for Q1 2022.

What is the cash position of Verano Holdings as of March 31, 2022?

Verano Holdings has a cash position of $140 million as of March 31, 2022.

When did Verano Holdings Corp. file its reviewed Q1 2022 financial statements?

Verano Holdings filed its reviewed Q1 2022 financial statements on June 17, 2022.

What was the net income reported by Verano Holdings for the first quarter of 2022?

Verano Holdings reported a net income loss of $10.1 million for Q1 2022.