Q2 2024 SNDL Inc Earnings Call Transcript
Key Points
- SNDL Inc (SNDL) reported an all-time record gross margin of 25.5%, with all segments contributing to gross profit and gross margin growth compared to the same quarter of 2023.
- The cannabis operations segment achieved positive gross profit for the second quarter in a row.
- Operating income showcased significant improvement on a consolidated basis, supported by growth in all segments.
- SNDL Inc (SNDL) expects approximately $130 million in principal repayments in the second half of the year, with $90 million already received.
- The company has $183 million of unrestricted cash, $601 million in marketable securities and investments, and no outstanding debt as of June 30, 2024.
- Net revenue in the second quarter of 2024 declined by $3.8 million or 1.6% year-on-year, driven by a slowdown in the liquor retail segment.
- Adjusted operating income for the cannabis operations segment dipped back into negative territory for the quarter.
- The liquor retail segment saw a net revenue decline of $11 million or 7% compared to the prior year, attributed to market slowdown and a shift in Easter timing.
- The company faces regulatory obstacles and inefficiencies in both Canada and the US, impacting their restructuring efforts.
- Free cash flow remained negative, with a small improvement from negative $6.4 million in Q1 to negative $5.6 million in Q2.
Good morning, and welcome to SNDL's second-quarter 2024 financial results conference call.
This morning, SNDL issued a press release announcing their financial results for the 2024 second quarter ended on June 30, 2024. This press release is available on the company's website at sndl.com. And filed on EDGAR and SEDAR as well.
The webcast replay of the conference call will also be available on the sndl.com website. SNDL has also posted a supplemental investor presentation in addition to the conference call presentation we will be reviewing today on its sndl.com website.
Presenting on this morning's call, we have Zach George, Chief Executive Officer; and Alberto Paredero, Chief Financial Officer.
Before we start, I would like to remind investors that certain matters discussed in today's conference call or answers that may be given to questions could constitute forward-looking statements. Actual results could differ materially from those anticipated.
Risk factors that could affect results are detailed in the company's financial reports and other public filings
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