The Greenrose Holding Co., the parent of Connecticut cannabis cultivator Theraplant, is trying to establish an even larger foothold in the state’s marijuana industry through equity joint venture partnerships, according to the company’s recent earnings call, but the firm’s first wave of applications was denied.
Greenrose, a multistate cannabis operator based in New York, submitted four of the 14 equity joint venture retail applications that were denied social equity status by the Social Equity Council. Company officials said they’re working to “address deficiencies” in those applications to meet regulatory requirements while also exploring other ways the company can participate in the recreational market.
Greenrose also applied for two hybrid retail licenses through equity joint venture partnerships, but didn’t indicate whether or not those applications had moved forward yet.
Greenrose bought Theraplant, one of the state’s four medical growers with a facility in Watertown, in March 2021. The company said it’s been scaling Theraplant’s marijuana grow operations in anticipation of the state’s adult-use market opening.
“We are focused on ramping our harvests to build additional inventory as we prepare to supply the expected recreational market, and we are closely monitoring regulatory progress on this front,” Greenrose CEO Mickey Harley said of his company’s Connecticut efforts. “After populating all grow rooms at our expanded Theraplant cultivation operations in the first quarter of this year, we successfully completed our first harvest out of our two newest Theraplant grow rooms in June.”
But Theraplant’s revenue has taken a hit this year, with Greenrose officials calling it a “result of sustained demand headwinds in Connecticut’s medical market, as well as increased competition and impacts from the state’s illicit market.” On the recent earnings call, Greenrose said Theraplant has had “lower patient demands” for their products in the second quarter.
Still, Greenrose’s overall second quarter revenue increased 40% over last year, from $6.6 million to $9.2 million.
While revenue was up, net income was down. Greenrose reported a $10.3 million loss in the second quarter of 2022, down from net income of $3.3 million in the year-ago period. The company said the loss was primarily attributable to production interruptions at True Harvest, its Arizona grow operation, and “ongoing demand headwinds in the Connecticut market,” among other increased expenses.
