TLRY
$4.72
Tilray Brands
($.14)
(2.88%)
Earnings Details
3rd Quarter February 2022
Wednesday, April 6, 2022 7:00:00 AM
Tweet Share Watch
Summary

Tilray Brands Beats

Tilray Brands (TLRY) reported 3rd Quarter February 2022 earnings of $0.04 per share on revenue of $151.9 million. The consensus estimate was a loss of $0.08 per share on revenue of $160.6 million. The Earnings Whisper number was for a loss of $0.06 per share.

Tilray, Inc. is a leading global cannabis-lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia, and Latin America that is changing people’s lives for the better – one person at a time – by inspiring and empowering the worldwide community to live their very best life by providing them with products that meet the needs of their mind, body, and soul and invoke a sense of wellbeing.

Results
Reported Earnings
$0.04
Earnings Whisper
($0.06)
Consensus Estimate
($0.08)
Reported Revenue
$151.9 Mil
Revenue Estimate
$160.6 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Tilray Brands, Inc. Reports Third Quarter Fiscal Year 2022 Financial Results

  • Profitable Quarter Includes Net Income of $52.5 Million and Adjusted EBITDA of $10.1 Million; 12th Consecutive Quarter of Positive Adjusted EBITDA

  • Net Revenue Increased 23% to $152 Million; Gross Profit Increased 31% to $39.8 Million from the Prior Year Quarter

  • Medical Market Share Leader in Europe and #1 Leadership Position in Germany with Revenue Growth of Over 4,000%

  • Maintained #1 Leading Marketing Share in Canada

  • Achieved $76 Million in Cost Synergies to Date; On-Track to Exceed Original Plan of $80 Million Ahead of Schedule and to Generate Additional $20 Million of Synergies in Fiscal 2023

LEAMINGTON, Ontario and NEW YORK, April 06, 2022 (GLOBE NEWSWIRE) -- Tilray Brands, Inc. (“Tilray” or the “Company”) (Nasdaq: TLRY; TSX: TLRY), a leading global cannabis-lifestyle and consumer packaged goods company inspiring and empowering the worldwide community to live their very best life, today reported financial results for the third fiscal quarter ended February 28, 2022. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated.

Irwin D. Simon, Tilray’s Chairman and Chief Executive Officer, stated, “Our third quarter results reflect progress and momentum across all of our key business segments and geographies, setting the stage to achieve our target for $4B in revenue by the end of fiscal 2024. Tilray Medical – which now operates under a cohesive strategy and mission – has a near 20% share in Germany, providing clear benefits in its own right as well as a first-mover advantage that we will leverage as Germany and the EU move towards broader adult-use and medical use legalization. In Canada, we maintained our leading market share position amid intense competition – and believe that our strong capital position, operational excellence and pricing and marketing adjustments will work in concert to help ensure we reclaim share in the coming quarters. This effort will gain further support from the fundamental appeal of our brands and product innovation which, as stores continue re-opening, will resonate powerfully with consumers. In the U.S., our SweetWater Brewing, Breckenridge Distillery, and Manitoba Harvest businesses are profitable, growing and emerging as nationwide, iconic brands with loyal followings that will be home to THC-based products upon U.S. federal legalization.”

Mr. Simon continued, “We also continued sourcing and executing strategic and shareholder-friendly transactions that provide value with notable upside. Our most recent example is the proposed agreement to purchase the HEXO senior secured convertible notes, which provides a path for meaningful future equity ownership of HEXO as it executes on its transformation. The proposed HEXO transaction is also expected to facilitate complementary commercial and product innovation and drive production and operating efficiencies. As the global economy re-opens, we are confident that the global cannabis powerhouse at the heart of the Tilray Brands’ value proposition will deliver sustained and tangible shareholder value.”

Financial Highlights – Third Quarter Fiscal 2022

  • Net revenue increased 23% to $152 million during the third quarter from $124 million in the prior year quarter. The increase was driven by 32% growth in cannabis revenue to $55 million, 64% growth in beverage alcohol revenue of $20 million and wellness revenue of $15 million.
  • Gross profit increased 31% to $40 million from $30 million in the prior year quarter. Gross margin increased to 26% from 25% in the prior year quarter.
  • Significant growth in international cannabis with revenue up over 4,000% from the prior year quarter, and 37% increase in revenue in EMEA when compared to the previous quarter
  • Maintained #1 leadership position in Canada1 with 10.2% cannabis market share driven by Tilray’s comprehensive portfolio of adult-use brands, and growth in pre-roll and vape product categories.
  • Cost synergies from Aphria-Tilray combination of $76 million achieved on a run-rate basis to date. Expect to reach $80 million synergy target by May 31, 2022, five months ahead of schedule and to generate an additional $20 million in synergies in fiscal 2023.
  • Distribution revenue decreased 11% to $63 million during the third quarter from $70 million in the prior year quarter. The decrease was driven by the impact of changes in the exchange rate between the Euro and USD, which led to a $7 million reduction.

1 Based on Hifyre retail data.

Strategic Growth Actions

  • On April 6, 2022 – Manitoba Harvest announced an exclusive partnership with Whole Foods Market launching the brand’s Hemp+ Matcha and Supergreens powders exclusively at Whole Foods across North America.
  • On April 5, 2022The Brewers Association announced that SweetWater Brewing Co. is now the 10th largest craft brewer in the U.S.
  • On April 5, 2022Tilray Brands announced the launch of Solei Bites, the first THC edible available in Quebec, the 2nd largest market in Canada.
  • On March 24, 2022 – Solei, Tilray Brands’ best-selling Canadian wellness brand, announced the launch of Renew Moonlight, CBN vape pen for nighttime use.
  • On March 17, 2022 – Tilray Medical launched the first medical cannabis oil products in Malta.
  • On March 8, 2022 – Good Supply, Tilray Brands’ best-selling Canadian cannabis brand, announced the launch of Hash Bats, its new fastest growing infused pre-rolls.
  • On March 3, 2022Tilray Brands announced a proposed strategic alliance with Hexo Corp. to bring together Canada’s top two cannabis market share leaders to strengthen operational efficiencies and product innovation to benefit consumers, shareholders, and the cannabis industry.
  • On March 2, 2022 – Manitoba Harvest announced its new lineup of superfood products.
  • On February 22, 2022SweetWater Brewing Company launched across Oregon and Washington, marking the brand’s expansion into their 39th and 40th states.
  • On February 17, 2022 – Tilray Medical announced its first shipment of medical cannabis products to Malta.
  • On February 10, 2022Breckenridge Distillery launched its second (sold-out) series of ‘Super’ Sexy Motor Oil, a limited-edition Bourbon aged in beer barrels for over a year.
  • On February 9, 2022SweetWater Brewing Company announced its West Coast expansion into California and a partnership with the largest beer distributor in the U.S.
  • On February 8, 2022Tilray Brands launched Tilray Medical, a new comprehensive global division focused on international medical cannabis advocacy and a portfolio of EU GMP-certified medical brands and products.
  • On January 25, 2022Tilray Brands announced an expanded medical cannabis product offering in Australia and the launch of a new online medical cannabis education platform for healthcare professionals in Australia and New Zealand.
  • On January 20, 2022 – Manitoba Harvest introduced new hemp recipes compatible with Vegan, Keto, Paleo, and Gluten-Free Diets.
  • On January 10, 2022Tilray announced a new parent name, Tilray Brands, Inc., reflecting the Company’s evolution from a Canadian LP to a global consumer packaged goods company powerhouse with a market leading portfolio of cannabis lifestyle and CPG brands.
  • On December 21, 2021SweetWater Brewing Company acquired award-winning craft-beer brands, Alpine Beer and Green Flash Brewing.
  • On December 8, 2021, Tilray acquired Breckenridge Distillery, strengthening its strategic position in the U.S.
  • On December 2, 2021, Manitoba Harvest introduced Hemp Hearts health hacks for the holidays.

Growth and High Potential Across Key Markets

#1 Market Leading Position in Germany and Poised to Accelerate Strategic Growth Initiatives Upon Adult-Use Legalization – Today, Germany remains the largest medical cannabis market in Europe and is expected to also be one of the largest adult use markets as well upon legalization. We are already the leader in medical cannabis within Germany with a market share of approximately 20% with our whole flower, extracts and Dronabinol products and, this, together with our investments in infrastructure, brands and people, positions us exceptionally well for adult-use cannabis legalization.

Strategic Expansion Across the EU – Tilray Brands’ success across the EU, a powerful growth market worth potentially $1 billion for the Company, is backed by its two state-of-the-art cultivation facilities in Portugal and Germany that provide EU GMP certified pharmaceutical-grade medical cannabis across the region. This unparalleled production capability coupled with Tilray Brands’ sales arrangements through major distribution channels in Germany, the UK, and other key markets, coupled with the strong relationships with local governments and the trust of our patients, gives Tilray Brands the ability to drive accelerated growth.

#1 Leading Cannabis Market Share in Canada – Amid an intensely competitive and over-saturated market, Tilray Brands remains the market leader in the CAD$4.26 billion Canadian cannabis market, driven by a portfolio of carefully curated brands across all consumer segments; medical, wellness, innovative cannabis 2.0 products across concentrates, edibles, and drinks; processing capacity; and distribution. In order to address the saturated marketplace, Tilray Brands has implemented strategic price adjustments, expanded distribution through its coast-to-coast agreement with Rose Life Sciences and Great North Distributors, and increased our focus on and accelerated product innovation. Proposed alliance with Hexo Corp. (Nasdaq: HEXO) (TSX: HEXO) would bring together Canada’s top two cannabis market share leaders to strengthen operational efficiencies and product innovation to benefit consumers, shareholders, and the cannabis industry.

A Leading U.S. CPG Platform with Operational Strength, Leadership Expertise, and Optionality to be Immediately Leveraged for Cannabis Products Upon Federal Legalization - In the U.S., Tilray Brands’ operating businesses include SweetWater Brewing Company, the 11th largest craft brewer in the nation and leading lifestyle brand, Breckenridge Distillery, and Manitoba Harvest, a pioneer in hemp, CBD and wellness products. Together, they generate approximately $100 million in revenue and are EBITDA and cash flow positive and will expand in the near term into CBD adjacencies and THC-based products upon legalization. Further, the Company continues to build its U.S. platform, including through its prior acquisition of a majority of the outstanding senior secured convertible notes of MedMen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) – which marked a critical step towards delivering on its objective of leading the U.S. cannabis market upon federal legalization.

Live Conference Call and Audio Webcast

Tilray Brands will host a live conference call and audio webcast to discuss these results today at 8:30 am Eastern Time, details of which are provided below.

Call-in Number: (877) 407-0792 from Canada and the U.S. or (201) 689-8263 from international locations. Please dial in at least 10 minutes prior to the start time.

A telephone replay will be available approximately two hours after the call concludes through April 22, 2022. To access the recording dial (844)-512-2921 from Canada and the U.S. or (412) 317-6671 from international locations and use the passcode 13728025.

There will be a simultaneous, live webcast available on the Investors section of Tilray Brands’ website at www.tilray.com. The webcast will also be archived. Additionally, Tilray's third quarter earnings call will be syndicated live to retail investors on the Public.com app.

About Tilray Brands

Tilray Brands, Inc. (Nasdaq | TSX: TLRY), is a leading global cannabis-lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia, and Latin America that is changing people's lives for the better – one person at a time. Tilray Brands delivers on this mission by inspiring and empowering the worldwide community to live their very best life and providing access to products that meet the needs of their mind, body, and soul while invoking wellbeing. Patients and consumers trust Tilray Brands to deliver a cultivated experience and health and wellbeing through high-quality, differentiated brands and innovative products. A pioneer in cannabis research, cultivation, and distribution, Tilray Brands’ unprecedented production platform supports over 20 brands in over 20 countries, including comprehensive cannabis offerings, hemp-based foods, and craft beverages.

For more information on how we open a world of wellbeing, visit www.Tilray.com.

Forward-Looking Statements

Certain statements in this communication that are not historical facts constitute forward-looking information or forward-looking statements (together, “forward-looking statements”) under Canadian securities laws and within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be subject to the “safe harbor” created by those sections and other applicable laws. Forward-looking statements can be identified by words such as “forecast,” “future,” “should,” “could,” “enable,” “potential,” “contemplate,” “believe,” “anticipate,” “estimate,” “plan,” “expect,” “intend,” “may,” “project,” “will,” “would” and the negative of these terms or similar expressions, although not all forward-looking statements contain these identifying words. Certain material factors, estimates, goals, projections or assumptions were used in drawing the conclusions contained in the forward-looking statements throughout this communication. Forward-looking statements include statements regarding our intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things: the Company’s ability to become the world's leading cannabis-focused consumer branded company; the Company’s ability to achieve market share and revenue growth in particular markets, including in Canada, the U.S. and the EU; our ability to achieve $4B in revenue by the end of fiscal 2024 and projected cost savings; and the likelihood and timing of any cannabis legislation in the U.S., Germany and other jurisdictions. Many factors could cause actual results, performance or achievement to be materially different from any forward-looking statements, and other risks and uncertainties not presently known to the Company or that the Company deems immaterial could also cause actual results or events to differ materially from those expressed in the forward-looking statements contained herein. For a more detailed discussion of these risks and other factors, see the most recently filed annual information form of Tilray and the Annual Report on Form 10-K (and other periodic reports filed with the SEC) of Tilray made with the SEC and available on EDGAR. The forward-looking statements included in this communication are made as of the date of this communication and the Company does not undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities laws.

Use of Non-U.S. GAAP Financial Measures

This press release and the accompanying tables include non-GAAP financial measures, including adjusted gross margin, Adjusted EBITDA and adjusted free cash flow. Management believes that the non-GAAP financial measures presented provide useful additional information to investors about current trends in the Company's operations and are useful for period-over-period comparisons of operations. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures provided by other companies due to potential differences in methods of calculation and items being excluded. They should be read only in connection with the Company's Consolidated Statements of Operations and Cash Flows presented in accordance with GAAP.

Adjusted EBITDA is calculated as net income (loss) before finance expense, net; non-operating expense (income), net; amortization; stock-based compensation; facility start-up and closure costs; inventory valuation adjustment; lease expense; and transaction costs. A reconciliation of Adjusted EBITDA to net loss, the most directly comparable GAAP measure, has been provided in the financial statement tables included below in this press release. Gross margin, excluding inventory valuation adjustments, is calculated as revenue less cost of sales adjusted to add back inventory valuation adjustments and amortization of inventory step-up, divided by revenue. A reconciliation of Gross margin, excluding inventory valuation adjustments, to gross margin, the most directly comparable GAAP measure, has been provided in the financial statement tables included below in this press release. Free cash flow is comprised of two GAAP measures deducted from each other which are net cash flow provided by (used in) operating activities less investments in capital and intangible assets. Adjusted free cash flow removes the cash impact of acquisitions from free cash flow. A reconciliation of net cash flow provided by (used in) operating activities to free cash flow and to adjusted cash flows, the most directly comparable GAAP measure, has been provided in the financial statement tables included below in this press release.

For further information:

Media: Berrin Noorata, news@tilray.com
Investors: Raphael Gross, +1-203-682-8253, Raphael.Gross@icrinc.com


Consolidated Statements of Financial Position

(In thousands of United States dollars) February 28,
2022
  May 31,
2021
 
Assets        
Current assets        
Cash and cash equivalents $279,214  $488,466 
Accounts receivable, net  89,895   87,309 
Inventory  273,292   256,429 
Prepaids and other current assets  52,211   48,920 
Convertible notes receivable  1,173   2,485 
Total current assets  695,785   883,609 
Capital assets  603,472   650,698 
Right-of-use assets  17,851   18,267 
Intangible assets  1,528,962   1,605,918 
Goodwill  2,835,100   2,832,794 
Interest in equity investees  4,797   8,106 
Long-term investments  133,155   17,685 
Other assets  314   8,285 
Total assets $5,819,436  $6,025,362 
Liabilities        
Current liabilities        
Bank indebtedness $17,496  $8,717 
Accounts payable and accrued liabilities  137,094   212,813 
Contingent consideration  31,592   60,657 
Warrant liability  19,366   78,168 
Current portion of lease liabilities  6,703   4,264 
Current portion of long-term debt  70,176   36,622 
Total current liabilities  282,427   401,241 
Long - term liabilities        
Lease liabilities  16,211   53,946 
Long-term debt  121,210   167,486 
Convertible debentures  501,075   667,624 
Deferred tax liability  237,208   265,845 
Other liabilities  292   3,907 
Total liabilities  1,158,423   1,560,049 
Stockholders' equity        
Common stock ($0.0001 par value; 990,000,000 shares authorized; 480,737,533 and 446,440,641 shares issued and outstanding, respectively)  48   46 
Additional paid-in capital  5,110,892   4,792,406 
Accumulated other comprehensive income  1,010   152,668 
Accumulated Deficit  (484,710)  (486,050)
Total Tilray Brands, Inc. stockholders' equity  4,627,240   4,459,070 
Non-controlling interests  33,773   6,243 
Total stockholders' equity  4,661,013   4,465,313 
Total liabilities and stockholders' equity $5,819,436  $6,025,362 


Condensed Consolidated Statements of Net Income (Loss) and Comprehensive (Loss)

  Three months ended
February 28,
  Nine months ended
February 28,
  Three months ended
February 28,
  Nine months ended
February 28,
 
(In thousands of United States dollars) 2022  2021  2022  2021  Change  %Change  Change  %Change 
Net revenue $151,871  $123,900  $475,047  $370,849  $27,971  23%  $104,198  28% 
Cost of goods sold  112,042   93,444   351,497   270,165   18,598  20%   81,332  30% 
Gross profit  39,829   30,456   123,550   100,684   9,373  31%   22,866  23% 
Operating expenses:                                
General and administrative  38,445   24,491   121,401   78,736   13,954  57%   42,665  54% 
Selling  8,641   6,155   25,283   18,051   2,486  40%   7,232  40% 
Amortization  24,590   10,786   84,345   19,121   13,804  128%   65,224  341% 
Marketing and promotion  7,578   3,259   20,163   12,436   4,319  133%   7,727  62% 
Research and development  164   127   1,464   472   37  29%   992  210% 
Change in fair value of contingent consideration  (29,065)     (29,065)     (29,065) NA   (29,065) NA 
Transaction costs  9,238   9,688   42,937   30,352   (450) (5%)   12,585  100% 
Total operating expenses  59,591   54,506   266,528   159,168   5,085  9%   107,360  67% 
Operating loss  (19,762)  (24,050)  (142,978)  (58,484)  4,288  (18%)   (84,494) 144% 
Interest expense, net  (2,312)  (7,943)  (22,422)  (18,511)  5,631  (71%)   (3,911) 21% 
Non-operating income (expense), net  72,719   (220,340)  186,329   (306,348)  293,059  (133%)   492,677  (161%) 
Income (loss) before income taxes  50,645   (252,333)  20,929   (383,343)  302,978  (120%)   404,272  (105%) 
Income taxes (recovery)  (1,830)  6,310   (2,739)  (13,707)  (8,140) (129%)   10,968  (80%) 
Net income (loss) $52,475  $(258,643) $23,668  $(369,636) $311,118  (120%)  $393,304  (106%) 
Total net income (loss) attributable to stockholders of Tilray Brands, Inc.: $43,190  $(273,519) $1,340  $(407,762) $316,709  (116%)  $409,102  (100%) 
Weighted average number of common shares - basic  485,668,750   265,401,924   470,303,170   250,701,376                 
Weighted average number of common shares - diluted  488,546,790   265,401,924   478,050,130   250,701,376                 
Net income (loss) per share - basic $0.09  $(1.03) $0.00  $(1.63)                
Net income (loss) per share - diluted $0.09  $(1.03) $0.00  $(1.63)                


Net Revenue by Operating Segment

(In thousands of United States dollars) Three months
ended
February 28,
2022
  % of
Total
revenue
  Three months
ended
February 28,
2021
  % of
Total
revenue
  Nine months
ended
February 28,
2022
  % of
Total
revenue
  Nine months
ended
February 28,
2021
  % of
Total
revenue
 
Cannabis revenue $55,045  36%  $41,721  34%  $184,269  39%  $147,689  40% 
Distribution revenue  62,532  41%   70,237  57%   198,587  42%   210,508  57% 
Beverage alcohol revenue  19,597  13%   11,942  10%   48,765  10%   12,652  3% 
Wellness revenue  14,697  10%     0%   43,426  9%     0% 
Net revenue $151,871  100%  $123,900  100%  $475,047  100%  $370,849  100% 
                                 
                                 

Net Cannabis Revenue by Market Channel

  Three months ended February 28,  Nine months ended February 28, 
(In thousands of United States dollars) 2022   2021   2022   2021  
Revenue from Canadian medical cannabis products $7,050  10%  $5,931  11%  $23,353  10%  $18,571  10% 
Revenue from Canadian adult-use cannabis products  43,504  63%   48,097  86%   162,632  70%   163,220  85% 
Revenue from wholesale cannabis products  2,804  4%   1,327  2%   6,763  3%   6,559  3% 
Revenue from international cannabis products  15,820  23%   347  1%   39,792  17%   4,627  2% 
Total cannabis revenue  69,178       55,702       232,540       192,977     
Excise taxes  (14,133) (20%)   (13,981) (25%)   (48,271) (21%)   (45,288) (23%) 
Total cannabis net revenue $55,045      $41,721      $184,269      $147,689     


Other Financial Information: Gross Margin and Adjusted Gross Margin

(In thousands of United States dollars) Three months ended February 28, 2022 
  Cannabis  Beverage  Distribution  Wellness  Total 
Gross revenue $69,178  $20,473  $62,532  $14,697  $166,880 
Excise taxes  (14,133)  (876)        (15,009)
Net revenue  55,045   19,597   62,532   14,697   151,871 
Cost of goods sold  37,042   8,091   57,566   9,343   112,042 
Gross profit $18,003  $11,506  $4,966  $5,354  $39,829 
Gross margin  33%  59%  8%  36%  26%
Adjusted gross profit $18,003  $11,506  $4,966  $5,354  $39,829 
Adjusted gross margin  33%  59%  8%  36%  26%
                     
  Three months ended February 28, 2021 
  Cannabis  Beverage  Distribution  Wellness  Total 
Gross revenue $55,702  $12,358  $70,237  $  $138,297 
Excise taxes  (13,981)  (416)        (14,397)
Net revenue  41,721   11,942   70,237      123,900 
Cost of goods sold  25,373   7,056   61,015      93,444 
Gross profit $16,348  $4,886  $9,222  $  $30,456 
Gross margin  39%  41%  13%      25%
Adjusted gross profit $16,348  $4,886  $9,222  $  $30,456 
Adjusted gross margin  39%  41%  13%      25%
                     
  Nine months ended February 28, 2022 
  Cannabis  Beverage  Distribution  Wellness  Total 
Gross revenue $232,540  $51,500  $198,587  $43,426  $526,053 
Excise taxes  (48,271)  (2,735)        (51,006)
Net revenue  184,269   48,765   198,587   43,426   475,047 
Cost of goods sold  122,492   20,674   178,093   30,238   351,497 
Gross profit $61,777  $28,091  $20,494  $13,188  $123,550 
Gross margin  34%  58%  10%  30%  26%
Adjusted gross profit $73,777  $28,091  $20,494  $13,188  $135,550 
Adjusted gross margin  40%  58%  10%  30%  29%
                     
  Nine months ended February 28, 2021 
  Cannabis  Beverage  Distribution  Wellness  Total 
Gross revenue $192,977  $13,112  $210,508  $  $416,597 
Excise taxes  (45,288)  (460)        (45,748)
Net revenue  147,689   12,652   210,508      370,849 
Cost of goods sold  80,780   7,337   182,048      270,165 
Gross profit $66,909  $5,315  $28,460  $  $100,684 
Gross margin  45%  42%  14%      27%
Adjusted gross profit $66,909  $5,315  $28,460  $  $100,684 
Adjusted gross margin  45%  42%  14%      27%


Other Financial Information: Adjusted Earnings before Interest, Taxes, and Amortization

(In thousands of United States dollars) For the three months
ended February 28,
  For the nine months
ended February 28,
 
Adjusted EBITDA reconciliation: 2021  2020  2021  2020 
Net income (loss) $52,475  $(258,643) $23,668  $(369,636)
Income taxes  (1,830)  6,310   (2,739)  (13,707)
Interest expense, net  2,312   7,943   22,422   18,511 
Non-operating expense (income), net  (72,719)  220,340   (186,329)  306,348 
Amortization  37,020   20,282   113,824   43,292 
Stock-based compensation  9,355   3,075   27,025   11,414 
Change in fair value of contingent consideration  (29,065)     (29,065)   
Facility start-up and closure costs  2,500      10,400    
Lease expense  800   372   2,400   1,002 
Inventory write down        12,000    
Transaction costs  9,238   9,688   42,937   30,352 
Adjusted EBITDA $10,086  $9,367  $36,543  $27,576 

Other Financial Information: Free Cash Flow and Adjusted Free Cash Flow

  For the three months
ended February 28,
  For the nine months
ended February 28,
 
(In thousands of United States dollars) 2022  2021  2022  2021 
Net cash provided by (used in) operating activities $(46,390) $696  $(156,738) $(52,966)
Less: investments in capital and intangible assets, net  (1,352)  (4,068)  (16,944)  (27,324)
Free cash flow $(47,742) $(3,372) $(173,682) $(80,290)
Cash expended related to acquisitions  12,142   9,688   68,652   30,352 
Adjusted free cash flow $(35,600) $6,316  $(105,030) $(49,938)

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Source: Tilray Brands, Inc.