Glass House Brands files prospectus supplement for ATM distribution program

Glass House Brands (GLASF) has filed a prospectus supplement to its short form base shelf prospectus dated May 16, 2024 with the securities regulatory authorities in all provinces and territories of Canada. Glass House Brands CEO stated, “During the third quarter, we delivered record setting results, highlighted by a 128% year-over-year increase in cannabis production, a record low quarterly cultivation cost of $103 per pound and robust growth in retail and consumer packaged goods. All three business lines, wholesale biomass, retail and wholesale CPG, achieved positive year-on-year and sequential revenue growth. As I mentioned on our earnings call, we’ve had many conversations with bankers about raising debt and equity capital over the past six months, and we aim to raise approximately $25 million to fund our Phase 3 expansion. The ATM program is a part of our fund-raising plans. Because we can pay existing obligations from our current operating cash flow and have no upcoming debt maturities for more than two years, we will take our time in choosing the most advantageous pricing and timing to execute the ATM program and other potential financings. We are focused on taking advantage of the current market conditions in California to expand market share, and as such, we are moving ahead aggressively with our expansion plans. We expect to spend $5 million in Capex related to Phase 3 expansion in the fourth quarter of 2024. This retrofit will include the addition of blackout curtains, shade screens, new gutters, a misting system, CO2 systems, and grow pipes. We are particularly excited because unlike our other greenhouses, Greenhouse 2 has nearly 11,000 lights already installed. We expect to start generating revenue by the fourth quarter of 2025, with production estimated at 275,000 pounds of cannabis in its first full year. Besides the additional production volume, we also believe Greenhouse 2 will grow our highest quality flower and be the most consistent year round thanks to the lights and other additional cultivation tools that will be part of the retrofit. The lights will also mean that its production should be less affected by the seasons and would allow us to take advantage of the cyclically higher prices in the front half of the year.” The Prospectus Supplement has been filed in connection with the Company’s previously announced at-the-market distribution program, pursuant to which the Company may from time to time sell up to $25 million of its subordinate voting shares, restricted voting shares and limited voting shares.