Release Date: April 17, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- FLUENT Corp (CNTMF, Financial) achieved a record-breaking annual revenue of $103.6 million in 2024, marking a 6.4% increase over 2023.
- The successful acquisition of RIV Capital expanded FLUENT Corp's operational footprint in New York, enhancing its multistate presence.
- The company strengthened its financial position with a non-dilutive debt refinancing and ended the year with over $40 million in cash and cash equivalents.
- FLUENT Corp launched new brands, MOODs and KNACK, in New York, and introduced Hyer Kind, a concentrates line, in Florida, which are gaining early traction with consumers.
- The company is expanding its operational footprint with 42 locations across Florida, New York, Pennsylvania, and Texas, and plans to open three more stores in Florida by year-end.
Negative Points
- Revenue in the fourth quarter of 2024 decreased to $24.9 million from $25.5 million in Q4 2023, primarily due to price pressures from increased inventory in Florida.
- Florida revenue dropped to $20.3 million compared to $21.6 million in 2023, impacting overall financial performance.
- Adjusted gross profit for Q4 2024 was $10 million or 40.1% of revenue, down from $12.6 million or 49.4% of revenue in 2023.
- Adjusted EBITDA for Q4 2024 decreased to $3 million from $6.9 million, driven by the decline in the Florida market.
- Cash flow used in operations for the last quarter of 2024 was $14.7 million, a significant decline from the $1.4 million provided by operations in the prior year.
Q & A Highlights
Q: With the current share price and a modest valuation of 1x revenue, have you considered a share buyback program from your available cash flow?
A: Robert Beasley, CEO: We have considered a share buyback at the Board level several times. Now that we have the cash available, it is on the table as a possible option. However, it has not reached the level of serious consideration yet, but it remains one of the many options to impact share value for the benefit of shareholders.
Q: Can you provide more details on the financial performance in Florida and its impact on overall results?
A: Patricia Fonseca, CFO: In Q4 2024, Florida revenue was $20.3 million compared to $21.6 million in 2023, primarily due to price pressures from increased inventory. This impacted our adjusted gross profit and EBITDA, which decreased due to the slowdown in the Florida market.
Q: What are the expectations for the new cultivation facilities in Tampa and Buffalo?
A: Robert Beasley, CEO: Construction is near completion for both facilities. The Tampa facility, Rosa, is expected to be operational by Q3 2025, and the Buffalo facility is anticipated to have its first plant date around June 2025. These facilities are designed for high-quality flower output, enhancing our production capabilities in Florida and New York.
Q: How did the acquisition of RIV Capital impact your operations in New York?
A: Robert Beasley, CEO: The acquisition provided us with a solid operational footprint in New York, including retail, wholesale, and cultivation assets. This expansion has been pivotal in strengthening our multistate presence and enhancing our brand portfolio with successful launches like MOODs and KNACK.
Q: What are the strategic plans for expanding your retail presence?
A: Robert Beasley, CEO: We currently have 42 locations across Florida, New York, Pennsylvania, and Texas, with plans to open three more stores in Florida by year-end. Additionally, we are building a wholesale program in New York under the name Entourage to leverage the increasing retail presence in the state.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
