GrowGeneration Reports Fourth Quarter and Full Year 2024 Financial Results
Full Year Net Sales of
Full Year Proprietary Brand Sales as a percentage of Cultivation and Gardening net sales increased to
End of Year cash, cash equivalents, and marketable Securities balance of
2025 Outlook calls for Revenue of
Fourth Quarter 2024 Summary(1)
-
Net sales of
$37.4 million -
Positive same-store sales of
1.0% ; -
Proprietary brand sales as a percentage of Cultivation and Gardening net sales increased to
30.4% compared to21.2% in the prior year; -
Gross profit margin of
16.4% , compared to23.5% in the prior year, due to strategic inventory rationalizations in 2024; -
Net loss improved to
$23.3 million $27.3 million -
Adjusted EBITDA(3) loss of
$8.1 million $3.7 million
Full Year 2024 Summary(2)
-
Net sales of
$188.9 million -
Positive same-store sales of
0.9% ; -
Proprietary brand sales as a percentage of Cultivation and Gardening net sales increased to
24.2% compared to18.8% in the prior year; -
Gross profit margin of
23.1% , compared to27.1% in the prior year, due to restructuring related activities including strategic product offering rationalizations in 2024; -
Store operating expenses decreased
$7.9 million 16.4% ; -
Net loss of
$49.5 million $46.5 million -
Adjusted EBITDA(3) loss of
$14.5 million $5.6 million -
Cash, cash equivalents, and marketable securities of
$56.5 million
Darren Lampert, GrowGen’s Co-Founder and Chief Executive Officer, commented, “2024 was a pivotal year for GrowGeneration. We successfully completed an extensive strategic restructuring plan across our organization to transform GrowGen into a leaner, more efficient and product-driven company with a business-to-business (B2B) customer focus. As our industry matures, we continued our digital transformation of sales by launching our new B2B e-commerce platform in the fourth quarter, enhancing the customer purchasing experience while driving operational efficiencies across our supply chain. All of these actions are expected to reduce expenses by approximately
“Importantly, our proprietary brands, led by Drip Hydro and Char Coir, delivered annualized growth of
Fourth Quarter 2024 Consolidated Results
Net sales decreased
Proprietary brand sales as a percentage of Cultivation and Gardening net sales increased to
Gross profit was
GAAP net loss was
Non-GAAP Adjusted EBITDA(3) was a loss of
Full Year 2024 Consolidated Results
Net sales declined
The decrease in net sales was primarily related to our Cultivation and Gardening segment, which had net sales of
Net sales of commercial fixtures within our Storage Solutions segment decreased to
Gross profit was
Gross profit margin was
Store and other operating expenses for the full year 2024 were
Selling, general, and administrative expenses for the full year 2024 were
GAAP net loss was
Non-GAAP Adjusted EBITDA(3) was a loss of
Cash, cash equivalents, and marketable securities as of December 31, 2024 were
Total current liabilities, including accounts payable, accrued payroll, and other liabilities as of December 31, 2024 were
Geographic Footprint
Our geographic footprint for our Cultivation and Gardening segment spans approximately 724,000 square feet of retail and warehouse space and includes 31 retail locations across 12 states. During 2024, we consolidated 19 retail stores where we generally expect to be able to serve the same customer base through a single location, thereby reducing redundancies in cost structure.
Full Year 2025 Outlook(5)
-
Full year 2025 net revenues in the range of
$170 million $180 million -
Full year 2025 Adjusted EBITDA(1) from a
$2 million $2 million -
Full year 2025 gross profit margin in the range of
29% to31%
Footnotes
(1) |
All comparisons are for the fourth quarter ended December 31, 2024 versus the fourth quarter ended December 31, 2023 |
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(2) |
All comparisons are for the year ended December 31, 2024 versus the year ended December 31, 2023 |
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(3) |
Adjusted EBITDA represents earnings before interest, taxes, depreciation, and amortization as adjusted for certain items as set forth in the reconciliation table of |
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(4) |
Adjusted Gross Profit represents gross profit as adjusted for certain items as set forth in the reconciliation table of |
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(5) |
Sales and Adjusted EBITDA guidance metrics are inclusive of acquisitions and store openings completed in 2024 and 2023, but do not include any unannounced acquisitions. |
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Conference Call
The Company will host a conference call today, March 13, 2025, at 4:30p.m. Eastern Time to discuss financial results for the fourth quarter and full year ended December 31, 2024. To participate in the call, please dial 1-(888) 699-1199 (domestic) or 1-(416) 945-7677 (international). The conference code is 00406. The call will also be webcast and can be accessed at https://app.webinar.net/d8g0z8jmEVx or on the Investor Relations section of the GrowGen website at https://ir.growgeneration.com. A replay of the webcast will be available approximately two hours after the conclusion of the call and remain available for approximately 90 calendar days.
About GrowGeneration Corp.
GrowGen is a leading developer, marketer, retailer, and distributor of products for both indoor and outdoor hydroponic and organic gardening, as well as customized storage solutions. GrowGen carries and sells thousands of products, such as nutrients, additives, growing media, lighting, environmental control systems, and benching and racking, including proprietary brands such as Charcoir, Drip Hydro, Power Si, Ion lights, The Harvest Company, and more. Incorporated in
To be added to the GrowGeneration email distribution list, please email GrowGen@kcsa.com with GRWG.
Forward Looking Statements
This press release may include predictions, estimates or other information that might be considered forward-looking within the meaning of applicable securities laws. While these forward-looking statements represent current judgments, they are subject to risks and uncertainties that could cause actual results to differ materially. You are cautioned not to place undue reliance on these forward-looking statements, which reflect opinions only as of the date of this release. Please keep in mind that the Company does not have an obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. When used herein, words such as “look forward,” “expect,” “believe,” “continue,” “building,” or variations of such words and similar expressions are intended to identify forward-looking statements. Factors that could cause actual results to differ materially from those contemplated in any forward-looking statements made by us herein are often discussed in filings made with the United States Securities and Exchange Commission, available at: www.sec.gov, and on the Company’s website, at: www.growgeneration.com.
GROWGENERATION CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands except shares) |
|||||||
|
December 31, 2024 |
|
December 31, 2023 |
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
27,471 |
|
|
$ |
29,757 |
|
Marketable securities |
|
28,984 |
|
|
|
35,212 |
|
Accounts receivable, net of allowance for credit losses of |
|
7,361 |
|
|
|
8,895 |
|
Notes receivable, current, net of allowance for credit losses of $— and |
|
1,056 |
|
|
|
193 |
|
Inventory |
|
40,295 |
|
|
|
64,905 |
|
Prepaid income taxes |
|
145 |
|
|
|
516 |
|
Prepaid and other current assets |
|
7,896 |
|
|
|
7,973 |
|
Total current assets |
|
113,208 |
|
|
|
147,451 |
|
|
|
|
|
||||
Property and equipment, net |
|
15,493 |
|
|
|
27,052 |
|
Operating leases right-of-use assets, net |
|
34,453 |
|
|
|
39,933 |
|
Notes receivable, long term |
|
— |
|
|
|
106 |
|
Intangible assets, net |
|
8,779 |
|
|
|
16,180 |
|
Goodwill |
|
1,605 |
|
|
|
7,525 |
|
Other assets |
|
814 |
|
|
|
843 |
|
TOTAL ASSETS |
$ |
174,352 |
|
|
$ |
239,090 |
|
|
|
|
|
||||
LIABILITIES & STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
8,146 |
|
|
$ |
11,666 |
|
Accrued liabilities |
|
2,358 |
|
|
|
2,530 |
|
Payroll and payroll tax liabilities |
|
2,655 |
|
|
|
2,169 |
|
Customer deposits |
|
2,404 |
|
|
|
5,359 |
|
Sales tax payable |
|
1,313 |
|
|
|
1,185 |
|
Current maturities of lease liability |
|
7,398 |
|
|
|
8,021 |
|
Total current liabilities |
|
24,274 |
|
|
|
30,930 |
|
|
|
|
|
||||
Operating lease liability, net of current maturities |
|
29,633 |
|
|
|
34,448 |
|
Other long-term liabilities |
|
352 |
|
|
|
317 |
|
Total liabilities |
|
54,259 |
|
|
|
65,695 |
|
Commitments and contingencies |
|
|
|
||||
Stockholders’ Equity: |
|
|
|
||||
Common stock; |
|
59 |
|
|
|
61 |
|
Additional paid-in capital |
|
375,677 |
|
|
|
373,433 |
|
Accumulated deficit |
|
(255,643 |
) |
|
|
(200,099 |
) |
Total stockholders’ equity |
|
120,093 |
|
|
|
173,395 |
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
174,352 |
|
|
$ |
239,090 |
|
GROWGENERATION CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) |
|||||||||||||||
|
Three Months Ended December 31, |
|
Year ended December 31, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
||||||||
Net sales |
$ |
37,436 |
|
|
$ |
49,452 |
|
|
$ |
188,866 |
|
|
$ |
225,882 |
|
Cost of sales (exclusive of depreciation and amortization shown below) |
|
31,309 |
|
|
|
37,808 |
|
|
|
145,144 |
|
|
|
164,624 |
|
Gross profit |
|
6,127 |
|
|
|
11,644 |
|
|
|
43,722 |
|
|
|
61,258 |
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Store operations and other operational expenses |
|
9,322 |
|
|
|
11,794 |
|
|
|
40,198 |
|
|
|
48,082 |
|
Selling, general, and administrative |
|
6,826 |
|
|
|
7,876 |
|
|
|
29,243 |
|
|
|
29,799 |
|
Estimated credit losses (recoveries) |
|
152 |
|
|
|
274 |
|
|
|
(58 |
) |
|
|
955 |
|
Depreciation and amortization |
|
7,107 |
|
|
|
4,130 |
|
|
|
19,436 |
|
|
|
16,607 |
|
Impairment loss |
|
6,655 |
|
|
|
15,659 |
|
|
|
6,875 |
|
|
|
15,659 |
|
Total operating expenses |
|
30,062 |
|
|
|
39,733 |
|
|
|
95,694 |
|
|
|
111,102 |
|
|
|
|
|
|
|
|
|
||||||||
Loss from operations |
|
(23,935 |
) |
|
|
(28,089 |
) |
|
|
(51,972 |
) |
|
|
(49,844 |
) |
|
|
|
|
|
|
|
|
||||||||
Other income (expense): |
|
|
|
|
|
|
|
||||||||
Other (expense) income |
|
— |
|
|
|
(5 |
) |
|
|
(13 |
) |
|
|
781 |
|
Interest income |
|
701 |
|
|
|
810 |
|
|
|
2,703 |
|
|
|
2,696 |
|
Interest expense |
|
— |
|
|
|
(91 |
) |
|
|
(70 |
) |
|
|
(97 |
) |
Total other income |
|
701 |
|
|
|
714 |
|
|
|
2,620 |
|
|
|
3,380 |
|
|
|
|
|
|
|
|
|
||||||||
Net loss before taxes |
|
(23,234 |
) |
|
|
(27,375 |
) |
|
|
(49,352 |
) |
|
|
(46,464 |
) |
|
|
|
|
|
|
|
|
||||||||
(Provision) benefit for income taxes |
|
(108 |
) |
|
|
61 |
|
|
|
(158 |
) |
|
|
(32 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss |
$ |
(23,342 |
) |
|
|
(27,314 |
) |
|
$ |
(49,510 |
) |
|
$ |
(46,496 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss per share, basic |
$ |
(0.39 |
) |
|
$ |
(0.44 |
) |
|
$ |
(0.82 |
) |
|
$ |
(0.76 |
) |
Net loss per share, diluted |
$ |
(0.39 |
) |
|
$ |
(0.44 |
) |
|
$ |
(0.82 |
) |
|
$ |
(0.76 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding, basic |
|
59,274 |
|
|
|
61,386 |
|
|
|
60,176 |
|
|
|
61,181 |
|
Weighted average shares outstanding, diluted |
|
59,274 |
|
|
|
61,386 |
|
|
|
60,176 |
|
|
|
61,181 |
|
Use of Non-GAAP Financial Information
The following non-GAAP financial measures of EBITDA and Adjusted EBITDA are not in accordance with, or an alternative for, generally accepted accounting principles ("GAAP") and should be considered in addition to, and not as a substitute for, the most directly comparable GAAP financial measures. We believe these non-GAAP financial measures, when used in conjunction with their most directly comparable GAAP financial measures, net income (loss), provide meaningful supplemental information to both management and investors, facilitating the evaluation of performance across reporting periods, identify trends affecting our business, and project future performance. Management uses these non-GAAP financial measures for internal planning and reporting purposes, and we believe that these non-GAAP financial measures may be useful to investors in their assessment of our operating performance, our ability to generate cash, and valuation. In addition, these non-GAAP financial measures address questions routinely received from analysts and investors and, in order to ensure that all investors have access to the same data, we have determined that it is appropriate to make this data available to all investors. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.
EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA are non-GAAP financial measures commonly used in our industry and should not be construed in isolation as substitutions to net income (loss) as indicators of operating performance or as alternatives to cash flow provided by operating activities as a measure of liquidity (each as determined in accordance with GAAP). GrowGeneration defines EBITDA as net income (loss) before interest income, interest expense, income tax expense, depreciation and amortization, and Adjusted EBITDA as further adjusted to exclude certain items such as stock-based compensation, impairment losses, restructuring and corporate rationalization costs, and other non-core or non-recurring expenses and to include income from our marketable securities as these investments are part of our operational business strategy and increase the cash available to us.
Set forth below is a reconciliation of EBITDA and Adjusted EBITDA to net loss (in thousands):
|
Three months ended December 31, |
|
Year ended December 31, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net loss |
$ |
(23,342 |
) |
|
$ |
(27,314 |
) |
|
$ |
(49,510 |
) |
|
$ |
(46,496 |
) |
(Provision) benefit for income taxes |
|
108 |
|
|
|
(61 |
) |
|
|
158 |
|
|
|
32 |
|
Interest income |
|
(701 |
) |
|
|
(810 |
) |
|
|
(2,703 |
) |
|
|
(2,696 |
) |
Interest expense |
|
— |
|
|
|
91 |
|
|
|
70 |
|
|
|
97 |
|
Depreciation and amortization |
|
7,107 |
|
|
|
4,130 |
|
|
|
19,436 |
|
|
|
16,607 |
|
EBITDA |
$ |
(16,828 |
) |
|
$ |
(23,964 |
) |
|
$ |
(32,549 |
) |
|
$ |
(32,456 |
) |
Share-based compensation |
|
318 |
|
|
|
719 |
|
|
|
2,422 |
|
|
|
3,171 |
|
Investment income |
|
661 |
|
|
|
810 |
|
|
|
2,582 |
|
|
|
2,696 |
|
Impairment loss (1) |
|
6,655 |
|
|
|
15,659 |
|
|
|
6,875 |
|
|
|
15,659 |
|
Restructuring plan (2) |
|
310 |
|
|
|
— |
|
|
|
3,009 |
|
|
|
— |
|
Consolidation and other charges (3) |
|
785 |
|
|
|
3,076 |
|
|
|
3,160 |
|
|
|
5,376 |
|
Adjusted EBITDA |
$ |
(8,099 |
) |
|
$ |
(3,700 |
) |
|
$ |
(14,501 |
) |
|
$ |
(5,554 |
) |
(1) Impairment loss related to impairments of goodwill and intangible assets and the restructuring plan for operating lease right-of-use assets impairments |
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(2) Includes the |
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(3) Consists primarily of expenditures related to the activity of store and distribution consolidation, one-time severances outside of the restructuring plan announced July 2024, and other non-core or non-recurring expenses |
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View source version on businesswire.com: https://www.businesswire.com/news/home/20250313567714/en/
KCSA Strategic Communications
Philip Carlson
Managing Director
T: 212-896-1233
E: GrowGen@kcsa.com
Source: GrowGeneration Corp.
