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January 27, 2023

Curaleaf closing cannabis operations in three western states; set to open fist recreational dispensary in CT

HBJ PHOTO | STEVE LASCHEVER Curaleaf employees monitor a harvest at the multistate company’s Simsbury grow facility.
By Skyler Frazer

Massachusetts-based multistate cannabis operator Curaleaf announced it is closing operations in three states, making it the second marijuana company with a large Connecticut presence to indicate it's facing major financial headwinds.

Curaleaf said late Thursday said it is closing a majority of its operations in California, Colorado and Oregon beginning this month. Further, the company will consolidate cultivation and processing operations in Massachusetts to the company’s facility in Webster, closing its Amesbury location.

Curaleaf CEO Matt Darin said the “states will represent opportunities in the future, but the current price compression caused by a lack of meaningful enforcement of the illicit market prevent us from generating an acceptable return on our investments.”

Curaleaf didn’t mention Connecticut operations in its announcement. The company is currently one of the state’s four active growers for medical and recreational marijuana and also operates medical dispensaries in Hartford, Milford and Groton. The company is hoping to convert it’s Hartford dispensary to hybrid operations, but has previously indicated plans to move that store to Manchester.

It also announced Friday morning that it has received approval from the Connecticut Department of Consumer Protection to open a recreational cannabis dispensary in Stamford, its first in the state. 

Curleaf said the the Stamford store at 814 East Main St. will open Jan. 28, at 10 a.m.

As part of the nationwide closures, Curaleaf said it reduced its payroll by 10%. In total, the cost savings will help the company realize $60 million in “gross run-rate expense savings” this year, Curaleaf said.

With the closure of cultivation and production facilities in California, Colorado and Oregon, Curaleaf said it will shift focus to its core “revenue-driving markets.” The company had already begun cost-cutting measures in the three states in 2022. Curaleaf said the three markets contributed less than $50 million in revenue for the company in 2022.

Curaleaf said it expects free cash flow to exceed $125 million in 2023 following the closures.

Earlier this month, Greenrose Holding Co., a multistate cannabis operator based in New York that owns Connecticut cultivation facility Theraplant, announced it was marketing itself for a potential sale as a result of financial challenges it faces.
 

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