Q1 2024 Revenue Of $18.8 Million, Excluding Discontinued OperationsQ1 Adjusted EBITDA1 Of $2.5 MillionOn Schedule for Norridge Retail Opening, Matteson Facility Approaching Full Operational StatusStrengthened Balance Sheet With $23 Million Debt Conversion into EquityAccelerated Innovation and Enhanced Product Offerings with New Launches Including "The Hunt" in Illinois, and "Mission Flower" in Massachusetts and Illinois PHOENIX, May 17, 2024 /CNW/ - 4Front Ventures Corp. (CSE:FFNT) (OTCQX:FFNTF) ("4Front" or the "Company"), a vertically integrated multi-state cannabis operator and retailer, today announced its results for the quarter ended March 31, 2024. All financial information is presented in U.S. dollars unless otherwise indicated. Q1 2024 Financial Highlights GAAP revenue from continuing operations of $18.8 million Adjusted EBITDA1 of $2.5 million $23 million senior secured debt converted to common equity by largest capital partner 1 Adjusted EBITDA is a non-GAAP measure. See "Note Regarding Non-GAAP Measures, Reconciliation, and Discussion." Management Commentary "We've had an encouraging start to the year, energized by the fresh dynamics introduced with my recent appointment as CEO," said Andrew Thut of 4Front Ventures. "In just a few weeks, we've seen tangible improvements in our financial health, evidenced by reduced operational costs and effective management of working capital." He added, "This quarter, we've made significant strides by converting a substantial portion of our debt into equity and continue to focus on strengthening our balance sheet and setting the stage for long-term profitability." "Looking ahead, 4Front is well-positioned for significant growth. The upcoming launch of our new cultivation and production facility in Matteson, Illinois, is expected to greatly enhance our supply capabilities by this summer. Alongside the expansion of our retail locations, these developments will drive growth and strengthen our market presence as we enter the second half of the year. Additionally, we are pleased to announce that we have completed the final inspection at our Norridge retail store location. We are currently submitting our final applications to the state and anticipate receiving our license as early as next week." Mr. Thut continued, "Yesterday, the DOJ proposed reclassifying cannabis as Schedule III, signaling a significant shift in federal cannabis policy. This change has profound legal and global implications, facilitates extensive medical research, and corrects historical injustices in cannabis-related law enforcement. It also alleviates the heavy tax burdens and lowers the operational barriers imposed on legally operating state businesses. This also marks the first time federal agencies officially recognize cannabis's medicinal benefits. We commend the President's commitment to cannabis reform, and his opposition to incarceration for cannabis-related offenses. " Mr. Thut concluded, "While we are encouraged by progress, there is still more work to be done, and we remain steadfast in our commitment to a strategic plan that builds long-term value. By investing in growth areas and refining our operational metrics throughout the year, our team remains energized and confident, and our deep understanding of the cannabis industry's complexities and opportunities positions us to capitalize on its ever-evolving dynamics." First Quarter 2024 Company Highlights  Strengthened Balance Sheet with $23 Million Debt Conversion into Equity: The Company converted $23 million of senior secured debt into common stock, reducing annual interest expense by approximately $3 million. Continuing Progress at Flagship Matteson, Illinois Facility: Rapidly approaching full operational status, this development marks a pivotal milestone in the Company's expansion efforts. The Company anticipates introducing plants to the facility in May, and scaling to full harvest capacity in August. The Company is set to increase the supply of high quality flower five-fold to power all its downstream product lines by this summer, alleviating supply constraints in Illinois and paving the way for future retail expansion. New Chief Executive Officer Appointed: Andrew Thut was named the new CEO by the Company's board of directors, effective January 8, 2024, succeeding Leo Gontmakher. Thut, who served as the Company's Chief Investment Officer since October 2014, brings extensive experience in financial management and a robust track record of business leadership. His previous role as Managing Director at BlackRock Advisors LLC, where he oversaw the BlackRock Small Cap Growth Fund, saw the fund achieve a ranking within the top five percent of all domestic small-cap growth funds. Launch of New Marquee Flower Brand, Mission Cannabis, in Illinois and Massachusetts: The Company launched Mission Cannabis, a brand that leverages advanced cultivation techniques and genetics to offer products with robust terpene profiles for superior taste and aroma. This launch follows more than five years of dedicated in-house strain development. Post-Quarter End Developments Introduced Crystal Clear Blast to Massachusetts and Illinois Markets: This innovative vape product marks a significant advancement in the Company's commitment to providing top-quality cannabis consumption devices, offering precision control through a unique 'blast' button and consistent delivery via a high-flow atomizer. Retail Expansion Update: Construction of the new store in Norridge is complete, and the team is prepared for the opening. The store has completed the final inspection, and the team is now submitting the final requests to the state, anticipating imminent receipt of licensure. The store is poised for strong performance, boasting a prime location in a large market with an attractive demographic, limited competition, ample parking, and advantageous co-tenancy with other high-traffic retailers. Strengthened Management and Operations: The Company has implemented significant leadership enhancements as part of its strategic initiatives. Matt Stevens, previously the Head of Cultivation in Massachusetts, will now oversee the critical growth engine at the Matteson facility, leveraging his extensive experience from the NECC facility. Additionally, Nick Ursul has joined the team to lead Illinois wholesale operations, bringing over 14 years of senior sales leadership experience from Merck, along with a background in business development from a leading regional cannabis and hemp testing lab. Q1 Financial Overview Revenue was $18.8 million for Q1 2024, compared to $26.3 million in the corresponding quarter of the previous year and $21.0 for Q4 of 2023.  In Massachusetts, revenue decreased from $9.3 million in Q4 of 2023 to $8.0 million, influenced by seasonal trends and lower flower yields and pricing. In Illinois, revenue slightly dipped from $8.7 million to $8.5 million, due to similar seasonal factors and market price adjustments. The company's adjusted EBITDA1 remained consistent at $2.5 million in Q1 of 2024, mirroring the previous quarter's performance. 1 Adjusted EBITDA is a non-GAAP measure. See "Note Regarding Non-GAAP Measures, Reconciliation, and Discussion." As of March 31, 2024, the Company had $2.9 million in cash and $66.1 million, with future debt maturities totaling $39.7 million. As of April 10, 2024, the Company had 912,923,993 Class A subordinate voting shares and 1,276,208 Class C multiple voting shares outstanding. Conference Call The Company will host a conference call and webcast today, Friday May 17, 2024, at 8:30 a.m. ET to review its financial and operating results and provide an update on current business trends. Date: Friday, May 17, 2024   Time: 8:30 a.m. Eastern Time   Webcast: Register   Dial-in: 1-888-664-6392 (North America Toll-Free) The conference call will be available for replay by phone until May 31, 2024, at 1-888-390-0541, replay code: 146608# Additionally, the webcast will be archived for approximately 90 days following the call and can be accessed via 4Front's Investor Relations website. For assistance, please contact About 4Front Ventures Corp.         4Front is a national, vertically integrated multi-state cannabis operator with operations in Illinois and Massachusetts and facilities in Washington. Since its founding in 2011, 4Front has built a strong reputation for its high standards and low-cost cultivation and production methodologies earned through a track record of success in facility design, cultivation, genetics, growing processes, manufacturing, purchasing, distribution, and retail. To date, 4Front has successfully brought to market more than 20 different cannabis brands and over 1,800 products, which are strategically distributed through its fully owned and operated Mission dispensaries and retail outlets in its core markets. As the Company continues to drive value for its shareholders, its team is applying its decade of expertise in the sector across the cannabis industry value chain and ecosystem. For more information, visit https://4frontventures.com/. 4FRONT VENTURES CORP. Consolidated Balance Sheets (unaudited) (Amounts expressed in thousands of U.S. dollars except for share and per share data) March 31, 2024 December 31, 2023 ASSETS Current assets: Cash $2,889 $3,398 Accounts receivable, net 4,098 3,682 Other receivables