Multi-state operator TerrAscend is continuing to pursue its strategy of getting deep into the US cannabis market. Recently, New Cannabis Ventures spoke to Jason Wild, Executive Chairman of TerrAscend, about the company’s current footprint and the planned acquisition by Gage Growth. Wild also discussed the company’s preparations for 2022.
Wild assumed the role of Executive Chairman in March. The TerrAscend team has been hard at work recruiting top executives over the past months. Wild reports that the team has made progress and plans to hire more executives in the near future.
TerrAscend retracted its 2021 guidance in August. This decision was largely driven by Pennsylvania-related factors. The state saw the company undertake a major expansion of its facility, which had a negative impact on quality and yields. The company had to demolish and rebuild a few rooms. According to Wild, the facility is in excellent condition and producing the most beautiful flowers it has ever cultivated. The company anticipates that revenue and EBITDA will increase sequentially between Q3 and Q4.
TerrAscend completed the acquisition of HMS Health in Maryland and HMS Processing, Maryland this spring. Wild said that although the 22,000-square foot operations are smaller than the ones in Pennsylvania and New Jersey, the team believed the deal was attractive due to its revenue run rate and profitability. TerrAscend also has the option to transfer the license to another facility.
The company has closed on a Maryland warehouse measuring 156,000 square feet. It plans to relocate its operations to the Maryland facility by 2022. Wild reports that adult use will be possible in the state within the next 12-24 months.
TerrAscend has partnered with Cookies to bring its products to the New Jersey marketplace. Gage Growth is Michigan’s exclusive Cookies processor and cultivator. This was the first time that Cookies came into contact with TerrAscend. People travel from far away to experience the brand’s power. According to Wild, customers who purchase Cookies products have larger basket sizes.
He expects the same effect to occur in New Jersey. TerrAscend has the perfect position to appeal to consumers who are looking for that brand, as there are no Cookies products available in New York and Pennsylvania. Two dispensaries are located within 20 minutes of Manhattan, and one is just over the border in Pennsylvania.
Five dispensaries are owned by TerrAscend in California. The COVID-19 pandemic impacted its three Apothecarium dispensaries located in San Francisco. This is where most cannabis customers are commuters and tourists. Although there have been some improvements, the three dispensaries are still not performing well. Wild reports that the company opened a dispensary at Berkeley. This one, however, is performing well.