Cannabis and drinks producer Tilray Brands has revised its sales forecast for its full financial year.
In a statement accompanying its latest results yesterday (8 April), the Hi*Ball Energy drinks producer cut its guidance for fiscal 2025 net revenues down to US$850m-$900m.
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It had previously forecast net revenues would sit between $950m and $1bn.
Tilray pinned the new forecast on “adjustments for constant currency and the impacts of the strategic initiatives and SKU rationalisation”.
In the three months ended 28 February, the Atwater Brewery owner saw net revenue drop 1% on the year prior to $185.8m. On a constant-currency basis, it grew roughly 3% on 2024 to $193m. Gross profits in the period grew 5% to $52m.
However, Tilray booked a third-quarter net loss of $793.5m. It filed impairments worth $699.2m for the quarter.
During the first nine months of the company’s fiscal year, its net revenue grew 7% year on year to $596.8m. Gross profit was also up 23% at $173m. Nine-month losses stood at $913m.
Adjusted EBITDA was down nearly 11% to $9m in the third quarter, and dropped 11.6% in the nine months, which Tilray attributed to the impact of cutting SKUs in its beverages division, equating to a $1m impact, as well as a $600,000 hit “related to the prioritisation of international cannabis markets”.
Tilray’s beverage division, which makes up 30% of the company’s revenues, saw net revenue grow 2% to $56m in the third quarter.
In the nine month period, this unit also grew 40% on the same period in 2024 to $175m.
In January, the business announced plans to cut more than 300 SKUs as part of a wider programme dubbed Project 420 through which Tilray is looking to find synergies to boost the profitability of its drinks division.
Speaking to analysts following the release of its results yesterday, CFO Carl Merton said the business was expecting the Project 420 programme to result in a $20m hit to net revenue in its fiscal year 2025.
He added the programme also includes “a distributor rationalisation to reduce our over 700 distributors to approximately 500 distributors”.
In a statement accompanying its results, chairman and CEO Irwin Simon said: “We see opportunities in the alcohol, cannabis and wellness industries and believe these sectors are here to stay.
He added: “In Q3, we delivered our highest cannabis gross margins in almost two years, and as of today our net debt is now less than one time EBITDA on a trailing twelve-month basis. We will not seek sales growth merely for the sake of sales if it does not add to the bottom line and benefit our shareholders.”
Alongside its results, Tilray also confirmed it did not expect to see US tariffs causing a hit to sales, with the company’s US drinks brands being “solely manufactured and distributed within the US market”, while its cannabis products in Canada are also made domestically.
“In Europe, Tilray manufactures medical cannabis brands and products for distribution across Europe and Australia. Regarding Tilray’s wellness business, Manitoba Harvest is currently exempt from the new tariffs,” the New York-headquartered business added.
