The periods affected are the 2021 and 2022 fiscal years and Q1 2023
The restatements are expected to have an immaterial impact on the Company’s gross profit, Adjusted EBITDA1 and the reported net cash provided by operating activities and no change to the cash balance for any of the restated periods
Q3 2023 and Q2 2023, during which the Company produced record high performance for several financial metrics, will not be affected by the restatement
Q4 2023 results, which will be reported in March, will also not be affected by the restatement
LONG BEACH, Calif. and TORONTO, March 5, 2024 /CNW/ – Glass House Brands Inc. (“Glass House” or the “Company”) (CBOE CA: GLAS.A.U) (CBOE CA: GLAS.WT.U) (OTCQX:GLASF) (OTCQX:GHBWF) announced today the intent to restate and reissue its financial statements for the fiscal years ended December 31, 2021 and 2022 and the interim period ended March 31, 2023 (“Restatement Period”) and any corresponding management’s discussion and analyses (collectively, the “Restated Documents”).
Management has determined the Company needs to restate the financial statements for certain revenue transactions processed through a distributor. These revenue transactions only impact the Company’s Consumer Products (CPG) and Retail business units. The Company also expects to restate the allocation of the purchase consideration for certain acquisitions that were made in 2022 and will assess the impairment of goodwill recognized during the quarter ended March 31, 2023 to determine if it should be recognized in 2022.
Kyle Kazan, Glass House Co-Founder, Chairman, and Chief Executive Officer said, “An issue was brought to our attention whereby we were questioned about how sales of our CPG brands into our stores were booked. During that time, we used Herbl as the distributor for our CPG sales to all third-party dispensaries along with our owned retail stores. As we never held any ownership or decision-making authority at Herbl which was the largest distributor in California, we accounted for the sales as third-party transactions. Upon further consideration, we have decided to restate our CPG sales into our stores during that time period as intercompany transactions. We expect …