Grown Rogue Reports First Quarter 2026 Results

Grown Rogue Reports First Quarter 2026 Results Canada NewsWire MEDFORD, Ore., May 12, 2026 Continued Solid New Jersey Performance, Yield Improvements, Product Expansion, and New Market Progress Support Growth Plans & Upwardly Revised Revenue Guidance MEDFORD, Ore., May 12, 2026 /CNW/ - Grown Rogue International Inc. ("Grown Rogue," "we," "us," "our," or the "Company") (CSE: GRIN | OTC: GRUSF), a flower-forward cannabis company combining craft values with disciplined execution, today reported its unaudited financial results for the three months ended March 31, 2026. All currency is in U.S. dollars unless otherwise noted. Results are presented in accordance with U.S. generally accepted accounting principles ("GAAP") and include consolidation of the Company's New Jersey operations, ABCO Garden State, LLC ("ABCO"), within the Company's financial statements. Comparative periods have been recast, where applicable, in accordance with GAAP. Highlights: Revenue of $9.2 million for the first quarter of 2026, compared to $7.2 million in the first quarter of 2025, an increase of approximately 28%, with growth driven largely by material revenue increases in New Jersey and modest revenue growth in Oregon. Michigan revenue increased year-over-year due to the inclusion of the pass-through of Michigan's new wholesale excise tax, while revenue excluding the excise tax declined approximately 4%. Adjusted EBITDA (non-GAAP) of approximately $1.6 million and Adjusted EBITDA margin of 17.1%, compared to Adjusted EBITDA of approximately $1.2 million and Adjusted EBITDA margin of 16.6% in the first quarter of 2025. GAAP net loss of $2.2 million for the first quarter of 2026, compared to GAAP net income of $0.7 million in the first quarter of 2025. First quarter 2026 results included non-cash fair value losses of $1.5 million, as compared to non-cash fair value gains of $1.5 million for the first quarter of 2025. New Jersey: continued strong sell-through of packaged, branded products, with Phase II construction underway. The first additional flower room is expected to add approximately 25% incremental capacity, with its first harvest scheduled for later this month. The remaining rooms are expected to come online incrementally through the remainder of 2026, resulting in an approximate doubling of capacity this year. Oregon and Michigan: Mature markets remained challenging, with continued year-over-year pricing declines and ongoing profitability pressure. Oregon revenue increased approximately 4% year-over-year, while Michigan reported gross revenue increased approximately 10% year-over-year, including the new wholesale tax implemented on January 1, 2026; excluding that impact, which was absorbed in price, Michigan revenue declined approximately 4%. While profitability in both markets remained pressured, management's focus on cost discipline has protected margins, while a focus on yield, quality, and targeted infrastructure improvements continued to support productivity gains, including strong yield performance in Michigan and the recent rollout of similar production technology and infrastructure improvements in Oregon. Minnesota: construction continued at the Company's Fridley cultivation facility. Phase I, consisting of approximately 8,000 square feet of flowering canopy, remains targeted to come online late Q3 2026, with first revenue expected in Q1 2027, subject to regulatory approvals, construction and commissioning timelines. Illinois: the Company continued preparations for its planned entry into Illinois through the previously announced cultivation facility in Dwight, Illinois, with operations expected to commence later this quarter, subject to regulatory approval. By State regulations, the facility is permitted to begin with 5,000 square feet of flowering canopy, which the Company plans to expand to approximately 10,000 square feet as quickly as allowed, and ultimately to the license maximum of 14,000 square feet. Product expansion: the Company launched its new vape products in Oregon, including all-in-one disposable vape and 510 cartridge formats developed in-house around single-source cured resin, full-spectrum formulation, and no additives. Management expects the category to support wallet-share growth and improve utilization of biomass streams, including trim and outdoor production inputs. Guidance: Management increased its 2026 revenue guidance to a range of $34 - $37 million from $32 – 35 million, previously, and reiterated its 2026 Adjusted EBITDA and 2027 guidance, reflecting greater comfort with performance and market trends in Michigan following implementation of the new wholesale tax in January and continued confidence in the Company's expansion plans. First Quarter 2026 Update First quarter 2026 results reflected continued progress against the Company's growth plan, including increased contribution from New Jersey, continued operating discipline in Oregon and Michigan, and ongoing work to broaden the Company's product offering and market footprint. The quarter was also the first full quarter following the Company's transition to U.S. GAAP reporting and consolidation of ABCO, creating a clearer baseline for evaluating performance as expansion projects in New Jersey, Illinois, and Minnesota advance. In New Jersey, demand and sell-through remained strong across packaged, branded products which represented 97% of New Jersey revenue in the quarter, Management believes quality, consistency, and affordability are the cornerstones of strong consumer loyalty across markets. The Company continued executing its Phase II expansion, which is expected to increase total New Jersey flowering canopy to approximately 16,000 square feet when complete later this year. As this capacity comes online, management anticipates short-term, modest reductions in the percentage of packaged, branded products sold. In Oregon and Michigan, the Company continued to focus on controllable factors, including cost per pound, yields, harvest quality, product consistency, and targeted infrastructure improvements. Oregon revenue increased approximately 4% year-over-year, while Michigan revenue increased approximately 10% year-over-year, primarily due to the pass-through of Michigan's new wholesale excise tax which was implemented on January 1, 2026. Excluding that impact, which was absorbed in price, Michigan revenue declined approximately 4% year-over-year. Both markets continued to experience pricing pressure, which impacted profitability in the quarter. In Michigan, yield performance continued to improve, and the Company is beginning to apply similar infrastructure improvements in Oregon with the objective of moving flower yield performance from recent levels in the 70 g/sf range toward the 80 g/sf range. The new vape category also reflects a product expansion strategy focused on staying true to our flower-forward ethos with disciplined SKU expansion and fuller utilization of the Company's efficient production capabilities. In Oregon, the Company is using its cultivation capabilities to convert select biomass streams that historically carry lower margins, into higher value branded vape products. Management views this as a capital-efficient way to extend the Grown Rogue brand into new consumption formats while preserving the genetics, flavor, and quality standards associated with its flower. The Company also advanced its new-market pipeline, including construction activity in Minnesota and progressing towards restarting the recently inhabited turn-key Illinois facility. These projects are expected to be important contributors to the Company's 2027 financial performance, subject to the assumptions and risks described in this release. Management Commentary "The first quarter was a continuation of the plan we laid out earlier this year: keep building in markets where we believe quality flower and disciplined execution can earn attractive returns, while staying sharp in mature markets that require strong cost control and operational excellence," said Obie Strickler, Chief Executive Officer. "New Jersey continues to validate our thesis, with consistent demand for our packaged, branded products and meaningful expansion work underway. At the same time, we are seeing evidence that the technology upgrade work done in Michigan is translating into stronger yield performance, and we have begun upgrading our facilities in Oregon. Mature markets keep us focused on the fundamentals that have always mattered most to Grown Rogue: genetics, passion, quality, consistency, and efficient production. In addition to the markets themselves being cash flow contributors, they provide a best-practices laboratory for us to adapt practices across markets as the teams and facilities are ready." Mr. Strickler continued, "Our priorities for 2026 remain clear. We are focused on completing Phase II in New Jersey, advancing our Minnesota buildout, preparing Illinois for operations, and continuing to broaden our product offering without losing the discipline that defines our approach. The new vape category is an example of that approach: using more of the plant and our in-house capabilities to create higher-value branded products in formats consumers are already choosing, while staying true to being flower forward with the genetics, flavor and flower integrity that define Grown Rogue. Assuming we navigate the regulatory timelines and inherent execution risks, we believe these initiatives can position Grown Rogue to enter 2027 with a more diversified operating base, a larger share of revenue from newer markets, and a stronger platform for sustainable profit growth." Josh Rosen, Chief Strategy Officer, added, "Our approach to growth is not based on chasing every license or every market. It is based on disciplined underwriting and building where we believe our capabilities matter most. Minnesota is a new-build opportunity in a market we believe can support attractive economics, while Illinois is a lower-capital-intensity, 'fixer-upper' opportunity where operational discipline may unlock meaningful value. Across the portfolio, our focus remains on improving yields, quality, and consistency, while expanding wallet share with a targeted set of flower-forward products. Andrew Marchington, Chief Financial Officer, commented, "First quarter 2026 marks our first quarterly reporting period following the transition to U.S. GAAP reporting and the consolidation of ABCO within our financial statements. We remain focused on transparent reporting, working capital discipline, cost controls, and allocating capital to projects that we believe meet our return thresholds. As we move through 2026 into 2027, we expect investors will have a clearer view of the operating profile of the business and the contribution of our newer markets. Of note, as we've managed our transition to GAAP, we've also been working on the integration of our core operational data with our financial performance and we found that we had not properly eliminated all of our selling costs as we recalibrated our cost of production metrics in our Operating KPIs, thus leading to a restatement of that metric looking backward as well." Selected First Quarter 2026 Financial Results (Unaudited) Metric Q1 2026 Q1 2025 YoY Change Q4 2025 Revenue (GAAP) $9.2 million $7.2 million +28 % $8.8 million Gross Profit $4.0 million $3.4 million +18 % $3.6 million Gross Margin 43.2 % 47.0 % -382 bps 40.8 % GAAP Net Income (Loss) ($2.2 million) $0.7 million n.m. ($0.7 million) EBITDA (non-GAAP) $1.0 million ($0.2 million) n.m. ($0.1 million) Adjusted EBITDA (non-GAAP) $1.6 million $1.1 million +32 % $1.2 million Adjusted EBITDA Margin 17.1 % 16.6 % +49 bps 16 % Cash and Cash Equivalents $13.7 million as of Mar. 31, 2026 $9.8 million as of Mar. 31, 2025 +39 % $11.4 million as of Dec. 31, 2025 n.m. = not meaningful. EBITDA and Adjusted EBITDA are non-GAAP financial measures. See "Non-GAAP Financial Measures" and the reconciliation tables included below.   Selected Quarterly Revenue by Segment (Unaudited) Segment Q1 2026 Revenue Q1 2025 Revenue YoY Change Q4 2025 Revenue Oregon $3.0 million $2.9 million +4 % $2.5 million Michigan* $2.7 million $2.5 million +10 % $2.7 million New Jersey $3.4 million $1.8 million +93 % $3.5 million Corporate / Other $0.0 million $0.0 million n.m. $0.0 million Total Revenue $9.2 million $7.2 million +28 % $8.8 million * Michigan Q1 2026 reported revenue includes the impact of the wholesale excise tax, enacted January 1, 2026.   Operating KPIs by Market Q1 2026 Q4 2025 Q3 2025 Q2 2025 Q1 2025 Q4 2024 Q3 2024 Q2 2024 Oregon* Total Flower Harvested (lbs) 3,275 2,980 3,547 3,392 3,423 3,239 3,100 2,457 Flower Cost Per Pound Produced $342 $379 $294 $331 $315 $327 $356 $ 455 Total Flower Yield (g/sf)1 69 68 73 72 69 69 63 58 "A" Flower Yield (g/sf)1 50 42 49 45 42 49 43 42 $ Bulk Flower ASP2 $480 $466 $499 $511 $610 $691 $736 $768 $ Packaged Flower ASP2 - - - - - - - - Portion of Revenue for Packaged Products 11 % 9 % 15 % 13 % 12 % 12 % 12 % 9 % Michigan Total Flower Harvested (lbs) 3638 3,960 3,518 3,391 2,948 3,104 3,215 3,010 Flower Cost Per Pound Produced $313 $287 $312 $323 $378 $362 $364 $383 Total Flower Yield (g/sf)1 $82 82 77 71 64 66 65 64 "A" Flower Yield (g/sf)1 $52 49 46 45 35 39 41 43 $ Bulk Flower ASP2 $599³ $692 $775 $734 $740 $833 $902 $1,013 $ Packaged Flower ASP2 $889³ $957 $900 $972 $940 $984 $1,041 $ 1,209 Portion of Revenue for Packaged Products 20 % 24 % 17 % 17 % 18 % 27 % 35 % 36 % New Jersey Total Flower Harvested (lbs) 1640 1,678 1,306 1,546 1,518 Flower Cost Per Pound Produced $676 $582 $770 $639 $630 Total Flower Yield (g/sf)1 61 64 59 58 57 "A" Flower Yield (g/sf)1 38 37 38 32 36 $ Bulk Flower ASP2 n.m.⁴ $1,193 $1,032 $939 $899 $ Packaged Flower ASP2 $1870 $2,131 $2,044 $2,562 $2,504 Portion of Revenue for Packaged Products 97 % 95 % 92 % 93 % 89 % *Includes only indoor operations ¹ g/sf = grams of product harvested for every square foot of growing space ² ASP = average selling price per pound ³ Excludes excise tax charged through to customers ⁴ Not meaningful Guidance and Long-Term (3-5 Year) Growth Objectives Management is reiterating the financial framework introduced in April 2026 to assist investors in evaluating the Company's growth strategy and capital allocation discipline. The guidance and long-term objectives set out below reflect current expectations, assumptions, and management objectives as of the date of this release and are subject to the forward-looking statements disclosure included herein. Growth Framework Selective new builds in undersupplied markets where craft-quality flower is expected to earn attractive wholesale economics and support the capital intensity of new-build projects. Fixer-upper takeovers and distressed opportunities where management believes disciplined execution can improve yield, consistency, and cost controls, typically with lower capital expenditure requirements. Focused product expansion, including flower-forward vape formats, intended to grow wallet share while maintaining a disciplined SKU set and consistent quality standards. Underwriting discipline based on mature-market, normalized pricing assumptions, without relying on perpetual early-cycle pricing upside to meet return targets. Long-term (3-5 year) Targets and Guidance Long-term (3-5 year) targets, using 2027 as the base year Revenue growth of 25% per year, compounded Profit growth (Adjusted EBITDA1) of 35% per year, compounded Return on Incremental Invested Capital ("ROIIC")2 of greater than 75% 2026 Guidance (Revenue / Adjusted EBITDA1): $34 - $37 million (up from $32 - $35 million) / $6 - $8 million. 2027 Guidance (Revenue / Adjusted EBITDA1): $50 - $58 million / $14 - $18 million. 1 Adjusted EBITDA (non-GAAP) excludes pre-revenue, startup expenses associated with new market expansion. 2 ROIIC (non-GAAP) is defined as the change in operating profit divided by the change in invested capital over the relevant measurement period. Note: The Company has not reconciled its forward-looking Adjusted EBITDA (non-GAAP) guidance to the most directly comparable GAAP measure because certain reconciling items are outside management's control or cannot be reasonably predicted without unreasonable effort. 2026 Guidance Assumptions: 2026 guidance excludes the start-up (pre-revenue) expenses in both Illinois and Minnesota of approximately $1.5 million to $2.0 million each. Illinois is expected to begin contributing revenue in Q4 2026 with approximately 5,000 square feet of flowering canopy initially online. Minnesota is expected to begin contributing revenue in the first quarter of 2027 with approximately 8,000 square feet of flowering canopy online. In New Jersey, the Company expects the current expansion to be substantially complete by Q4 2026, with ramp and sell-through reaching targeted levels by Q1 2027. As a result, the expansion is expected to contribute modestly to revenue and Adjusted EBITDA (non-GAAP) in 2026 and is more fully reflected in 2027 guidance. Overall, the Company anticipates consolidated gross margins of greater than 40% and corporate overhead expenses to increase by less than 10% in 2026. 2027 Guidance Assumptions: 2027 guidance assumes modest wholesale price normalization from 2026 levels in New Jersey and Illinois of approximately 10% and 5%, respectively. Minnesota is assumed to remain supply-constrained, supporting wholesale flower pricing above $2,500 per pound. In Oregon and Michigan, the guidance assumes no change in the current pricing environment, which management believes represents an appropriately conservative case for those markets. New Jersey assumes completion of the Phase II expansion in 2026, with 2027 reflecting a full year at expanded capacity. The Company currently plans to expand Illinois flowering canopy from 5,000 to 14,000 square feet and to expand Minnesota flowering canopy from 8,000 to approximately 16,000 square feet in mid-2027, utilizing existing capital and internally generated cash flow to fund the expansions. Overall, the Company anticipates consolidated gross margins of greater than 42% and corporate overhead expenses to increase by less than 25% in 2027. General Assumptions. Guidance and long-term objectives exclude any potential changes in U.S. federal cannabis policy and do not assume M&A or additional distressed opportunities unless explicitly stated. State-by-State Indoor Cultivation Flowering Capacity (Bench Canopy) On average, Grown Rogue anticipates producing approximately 800-900 lbs of flower annually per 1,000 square feet of flower canopy. State Canopy / capacity online (sq. ft.) Under development (sq. ft.) Nameplate capacity (sq. ft.) Notes Oregon (indoor only) └ Airport 9,152 N/A 9,152 Approximately 30,000 sq. ft. indoor facility space. └ Rossanley 5,600 N/A 5,600 Eight dedicated flower rooms; nearly four harvests per month. Michigan 14,550 N/A 14,550 Facility currently operates approximately 50,000 sq. ft., including fourteen flowering rooms and related support space. New Jersey 8,000 8,000 16,000 Expansion underway through 2026, with total capacity anticipated to increase to approximately 16,000 sq. ft. of flowering canopy. Minnesota N/A 8,000 30,000 Phase I includes approximately 8,000 sq. ft. of flowering canopy with products expected to be available for sale in early 2027 Illinois N/A 5,000 14,000 Approximately 66,000 sq. ft. leased facility, including 23,000 sq. ft. greenhouse, with existing indoor flower capacity of 5,000 sq. ft. targeted online in Q4 2026, expandable to 14,000 sq. ft. subject to regulatory approval Totals 37,302 21,000 89,302 Conference Call and Webcast Information Grown Rogue will host a conference call and webcast on Tuesday, May 12, 2026, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to discuss its first quarter 2026 results and provide a corporate update To further enhance investor disclosure, the Company will also post an updated Company Overview presentation to its website in advance of the call. Conference Call Details Date: Tuesday, May 12, 2026 Time: 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) Webcast: Register Dial-in: 1-800-836-8184 (Toll-Free in North America) A telephone replay of the conference call will be available until May 19, 2026, by dialing (+1) 888 660 6345 and entering replay code 19264#. A transcript of the call will also be made available on Grown Rogue's Investor Relations website at https://www.grownrogue.com/investors.  For assistance, please contact: [email protected]. The contents of our investor relations website are not incorporated by reference into this press release or any report or document that Grown Rogue files with the SEC or Canadian Securities Administrators ("CSA"), and any references to the websites are intended to be inactive textual references only. About Grown Rogue Grown Rogue International Inc. (CSE: GRIN | OTC: GRUSF) is a flower-forward cannabis company rooted in Oregon's Rogue Valley, a region known for its deep cannabis heritage and commitment to quality. With operations in Oregon, Michigan, and New Jersey—and expansion underway in Illinois and Minnesota —Grown Rogue specializes in producing designer-quality indoor flower. Known for exceptional consistency and care in cultivation, its products are valued by retailers, budtenders, and consumers alike. By blending craft values with disciplined execution, the Company has built a scalable, capital-efficient platform designed to thrive in competitive markets. The Company believes sustained excellence in cannabis flower production is the engine of the industry's supply chain—and its competitive advantage. For more information about Grown Rogue, please visit www.grownrogue.com. The contents of our website are not incorporated by reference into this press release or any report or document that Grown Rogue files with the SEC or CSA, and any references to the websites are intended to be inactive textual references only. Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) (Unaudited) For the three months ended March 31, 2026 and 2025 (US$ in millions) 2026 2025 $ $ Revenue Product sales 9,155,658 7,150,183 Total revenue 9,155,658 7,150,183 Cost of goods sold Cost of finished cannabis inventory sold (5,198,024) (3,786,436) Total cost of goods sold (5,198,024) (3,786,436) Gross profit 3,957,634 3,363,747 Operating expenses Amortization (Notes 9, 10) 91,162 104,984 General and administrative 3,611,823 2,532,254 Share-based compensation (Note 16) 154,994 1,435,910 Total operating expenses 3,857,979 4,073,148 Income (loss) from operations 99,655 (709,401) Other income (expense) Interest and accretion expense (Note 11, 13) (549,980) (258,171) Other income (expense) 165,268 796,956 Interest income (Note 8) 42,187 35,937 Unrealized gain on derivative liability (Note 13) 66,377 2,864,373 Realized loss on derivative liability (Note 13) - (29,288) Unrealized gain (loss) on warrant asset (Note 6) (2,191,084) (1,172,492) Unrealized gain on change in fair value of warrant liability (Note 13.3) 770,714 - Loss on equity investment in associate (Note 7) (99,657) (153,734) Total other income (expense), net (1,796,175) 2,083,581 Income (loss) before income tax expense (1,696,520) 1,374,180 Income tax expense (Note 18) (516,871) (631,310) Net income (loss) (2,213,391) 742,870 Other comprehensive income Currency translation adjustment - 7,832 Total comprehensive income (loss) (2,213,391) 750,702 Basic income (loss) per share (0) 0.00 Basic weighted average number of subordinate voting common shares outstanding 249,914,536 227,189,980 Diluted income (loss) per share (0) 0.00 Diluted weighted average number of subordinate voting common shares outstanding 249,914,536 231,795,875 Net income (loss) for the period attributable to: Shareholders (2,702,217) 598,782 Non-controlling interest 488,826 144,088 Net income (loss) (2,213,391) 742,870 Total comprehensive income (loss) for the period attributable to: Shareholders (2,702,217) 606,614 Non-controlling interest 488,826 144,088 Total comprehensive income (loss) (2,213,391) 750,702   Consolidated Balance Sheets (Unaudited) As of March 31, 2026 and December 31, 2025 (US$ in millions) March 31, 2026 December 31, 2025 $ $ ASSETS Current assets Cash and cash equivalents 13,701,247 11,371,834 Accounts receivable, net (Note 4) 3,239,626 2,908,270 Inventory (Note 5) 7,138,400 7,081,295 Prepaid expenses 516,553 563,912 Current portion of notes receivable 259,653 253,403 Total current assets 24,855,479 22,178,714 Other long-term assets 300,000 300,000 Warrants asset (Note 6) 2,912,188 5,103,272 Other Investments (Note 7) 1,459,203 1,358,860 Notes receivable (Note 8) 1,719,694 1,683,757 Lease receivable 94,022 94,022 Property and equipment, net (Note 9) 15,467,088 14,055,552 Right of use assets (Note 10) 14,065,295 13,414,406 Deferred tax asset 1,944,078 1,522,760 Intangible assets 3,025,193 3,025,193 TOTAL ASSETS 65,842,240 62,736,536 LIABILITIES Current liabilities Accounts payable and accrued liabilities 2,731,607 1,262,519 Current portion of operating lease liabilities 965,115 844,421 Current portion of finance lease liabilities 158,477 152,705 Current portion of long-term debt 2,765,900 2,576,228 Current portion of business acquisition consideration payable (Note 20) 553,064 455,844 Derivative liability 70,664 137,041 Warrant liabilities (Note 13.3) 768,951 - Income tax payable 286,980 296,018 Total current liabilities 8,300,758 5,724,776 Operating lease liabilities 13,618,798 13,010,805 Finance lease liabilities 51,359 67,782 Long-term debt 9,916,224 10,019,301 Business acquisition consideration payable (Note 20) 1,485,820 1,611,637 Other non-current liabilities 9,227,313 8,383,888 Total liabilities 42,600,272 38,818,189 Commitments and contingencies (Note 24) Subsequent events (Note 25) SHAREHOLDERS' EQUITY Subordinate voting common shares, convertible into multiple voting common shares, no par value; unlimited shares authorized; 249,938,980 and 249,738,980 shares issued and outstanding as at March 31, 2026 and December 31, 2025, respectively 61,226,243 62,589,075 Multiple voting common shares, no par value; unlimited shares authorized; nil and nil shares issued and outstanding as at March 31, 2026 and December 31, 2025, respectively 0 0 Accumulated other comprehensive loss (121,906) (121,906) Accumulated deficit (44,266,172) (41,563,955) Equity attributable to shareholders 16,838,165 20,903,214 Non-controlling interests (Note 23) 6,403,803 3,015,133 TOTAL SHAREHOLDERS' EQUITY 23,241,968 23,918,347 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 65,842,240 62,736,536   Consolidated Statements of Cash Flow (Unaudited) For the three months ended March 31, 2026 and 2025 (US$ in millions) 2026 2025 $ $ Operating activities Net income (loss) (2,213,391) 742,870 Adjustments for non-cash items in net income (loss) and earnings impact of warrant liability reclassification: Depreciation of property and equipment 91,162 104,984 Depreciation of property and equipment included in costs of finished cannabis inventory sold 822,531 315,216 Lease costs included in costs of finished cannabis inventory sold 199,415 34,055 Share-based compensation 154,994 1,435,910 Interest and accretion expense 549,980 258,171 Other income - (41,501) Interest income (42,187) (35,937) Unrealized (gain) loss on derivative liability (66,377) (2,864,373) Realized (gain) loss on derivative liability - 29,288 Unrealized loss on warrant asset 2,191,084 1,172,492 Unrealized gain on warrant liability (770,714) - Loss on equity investment in associate 99,657 153,734 Deferred income taxes (421,318) (63,418) Changes in operating assets and liabilities (Note 19) 1,939,688 (2,246,071) Net cash provided by (used in) operating activities 2,534,524 (1,004,580) Investing activities Purchase of property and equipment (2,517,414) (241,532) Payments of business acquisition consideration payable (157,199) (43,290) Investment in Rogue EBC, LLC equity interest (200,000) (49,000) Net cash used in investing activities (2,874,613) (333,822) Financing activities Sale of non-controlling interest in GRMA, net of issuance costs 2,985,000 - Preferred share issuance costs - - Proceeds from exercise of stock options 21,839 16,038 Proceeds from long-term debt 500,000 7,250,155 Distributions to non-controlling interests in subsidiaries (85,156) - Debt issuance costs - (213,373) Repayment of long-term debt (733,431) (732,004) Payment of interest on convertible debentures - (75,529) Repayment of finance lease (18,750) - Net cash provided by financing activities 2,669,502 6,245,287 Effect of foreign exchange on cash and cash equivalents - 7,832 Change in cash and cash equivalents 2,329,413 4,906,885 Cash and cash equivalents, beginning of period 11,371,834 4,917,708 Cash and cash equivalents, ending of period 13,701,247 9,832,425   Adjusted EBITDA Reconciliation Table (Unaudited) Three months ended March 31, 2026 (US$ in millions) Adjusted EBITDA Reconciliation 2026 2025 Net income (loss) (2,213,391) 742,870 Add back amortization of property and equipment included in cost of sales 822,531 434,202 Add back interest and interest accretion expense 549,980 258,171 Add back amortization of property and equipment 91,162 104,984 Add back loss on equity investment in associate 99,657 153,734 Add back income tax expense 516,871 631,310 Deduct gain on derivative liability (66,377) (2,835,085) Deduct interest expense and other income (expense) (207,455) (832,893) Add back changes in FV on warrants asset and liability 1,420,370 1,172,492 EBITDA 1,013,346 (170,215) Add back share-based compensation 154,994 1,435,910 Deduct GAAP bad debt conversion adjustment - (79,000) Add back pre-operational startup costs ¹ 396,165 - Adjusted EBITDA 1,564,505 1,186,695 1During the three months ended March 31, 2026 and 2025, pre-operational startup costs associated with investments in Minnesota were $396,165 and nil, respectively.   Preliminary Segmented Adjusted EBITDA (Unaudited) – Three months ended March 31, 2026 (US$ in millions) Oregon Michigan New Jersey Corporate Consolidated $ $ $ $ $ Revenue 2,996,764 2,743,527 3,415,368 - 9,155,658 Total cost of goods sold (2,445,600) (1,418,264) (1,334,160) - (5,198,024) Gross profit 551,164 1,325,262 2,081,208 - 3,957,634 Operating expenses General and administration 445,276 995,421 867,242 1,303,884 3,611,823 Depreciation and amortization 31,341 37,915 20,530 1,376 91,162 Share based compensation - - - 154,994 154,994 Other income and expense Interest and accretion (5,477) (4,013) (141,003) (399,487) (549,980) Interest and other income (expense) 10,000 61,664 (7,610) 143,401 207,455 Unrealized loss on derivative liability - - - 66,377 66,377 Realized gain on derivative liability - - - - - Unrealized gain (loss) on warrants asset - - - (2,191,084) (2,191,084) Unrealized gain on warrant liability - - - 770,714 770,714 Loss on equity method investment - - - (99,657) (99,657) Net income (loss) before tax 79,070 349,578 1,044,823 (3,169,990) (1,696,520) Tax - - - (516,871) (516,871) Net income (loss) 79,070 349,578 1,044,823 (3,686,861) (2,213,391) EBITDA Adjustments Amortization in cost of sales 320,567 207,260 294,703 - 822,531 Amortization of property and equipment 31,341 37,915 20,530 1,376 91,162 Interest and accretion 5,477 4,013 141,003 399,487 549,980 Interest and other income (expense) (10,000) (61,664) 7,610 (143,401) (207,455) Change in fair value of derivative liability - - - (66,377) (66,377) Unrealized warrants asset - - - 1,420,370 1,420,370 Loss on equity method investment - - - 99,657 99,657 Income tax - - - 516,871 516,871 EBITDA before one-time adjustments 426,455 537,101 1,508,669 (1,458,879) 1,013,346 Share-based compensation - - - 154,994 154,994 GAAP conversion bad debt adjustment - - - - - Pre-operational startup costs - - - 396,165 396,165 Adjusted EBITDA 426,455 537,101 1,508,669 (907,720) 1,564,505   Quarterly Adjusted EBITDA (Unaudited) – Trailing 5 quarters (US$ in millions) Adjusted EBITDA Reconciliation Q1 2026 Q4 2025 Q3 2025 Q2 2025 Q1 2025 Revenue 9,155,658 8,753,498 8,514,268 8,009,987 7,150,183 Total cost of goods sold (5,198,024) (5,184,072) (4,855,244) (4,455,502) (3,786,436) Gross profit 3,957,634 3,569,426 3,659,024 3,554,485 3,363,747 Operating expenses General and administration 3,611,823 3,468,822 2,964,469 2,678,372 2,532,254 Depreciation and amortization 91,162 378,654 110,693 107,927 104,984 Share based compensation 154,994 306,308 314,951 336,825 1,435,910 Other income and expenses Interest and accretion (549,980) (283,105) (410,925) (432,553) (258,171) Interest and other income (expense) 207,455 260,679 156,439 (137,550) 832,893 Unrealized loss on derivative liability 66,377 96,813 (24,242) (2,892,027) 2,864,373 Realized gain on derivative liability 0 0 0 5,889,032 (29,288) Unrealized gain (loss) on warrants asset (2,191,084) (573,956) 2,162,087 (168,162) (1,172,492) Unrealized gain on warrant liability 770,714 0 0 0 0 Loss on equity method investment (99,657) (108,809) (75,733) (114,686) (153,734) Net income (loss) before tax (1,696,520) (1,192,736) 2,076,537 2,575,415 1,374,180 Tax (516,871) 459,289 (511,381) (920,037) (631,310) Net income (loss) (2,213,391) (733,447) 1,565,156 1,655,378 742,870 EBITDA adjustments Amortization in cost of sales 822,531 702,751 895,472 658,232 434,202 Amortization of property and equipment 91,162 378,654 110,693 107,927 104,984 Interest and accretion 549,980 283,105 410,925 432,553 258,171 Interest and other income (expense) (207,455) (260,679) (156,439) 137,550 (832,893) Change in fair value of derivative liability (66,377) (96,813) 24,242 (2,997,005) (2,835,085) Unrealized warrants asset 1,420,370 573,956 (2,162,087) 168,162 1,172,492 Loss on equity method investment 99,657 108,809 75,733 114,686 153,734 Income tax 516,871 (459,289) 511,381 920,037 631,310 EBITDA before one-time adjustments 1,013,346 497,047 1,275,076 1,197,520 (170,215) Share-based compensation 154,994 306,308 314,951 336,825 1,435,910 Golden Harvests acquisition costs 0 60,000 0 60,000 0 GAAP conversion bad debt adjustment 0 237,000 (79,000) (79,000) (79,000) Pre-operational startup costs 396,165 72,217 0 0 0 Adjusted EBITDA 1,564,505 1,172,572 1,511,027 1,515,345 1,186,695 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This press release contains "forward looking information" and "forward-looking statements" within the meaning of applicable securities laws, including, without limitation, statements regarding: the Company's financial guidance and long-term targets; anticipated timing, capacity, ramp and revenue contributions in Illinois, Minnesota and New Jersey; future capital allocation; growth opportunities; pricing assumptions; working capital requirements; and the expected benefits of the Company's transition from IFRS to GAAP and consolidation of ABCO. Forward-looking statements are often identified by words such as "may," "would," "could," "should," "will," "intend," "plan," "anticipate," "believe," "estimate," "expect," "target," "guidance," or similar expressions. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements. Although the Company believes that the expectations reflected in these statements are reasonable, forward-looking statements are based on management's current expectations, estimates, assumptions and projections as of the date of this release, including, without limitation, assumptions regarding market conditions, wholesale pricing, demand, construction timelines, regulatory approvals, capital availability, operating performance, and the timing of new market launches and expansion projects. Although the Company believes these assumptions are reasonable, forward-looking statements are inherently subject to risks and uncertainties, and undue reliance should not be placed on such statements. Actual results may differ materially from those expressed or implied by forward-looking statements as a result of a number of known and unknown risks and uncertainties, including, without limitation: changes in general economic, business and political conditions; access to debt or equity capital on acceptable terms; adverse changes in the public perception of cannabis; decreases in prevailing prices for cannabis and cannabis products in the markets in which the Company operates; regulatory developments and the timing or availability of required approvals; the pace and cost of construction, commissioning and ramp activities; and the other risks described in the Company's public disclosure documents filed on SEDAR+ and www.sec.gov. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Readers are cautioned that future-oriented financial information and financial outlooks contained in this release are provided for the purpose of describing management's current expectations and may not be appropriate for other purposes. The Company is indirectly involved in the manufacture, possession, use, sale and distribution of cannabis in the recreational cannabis marketplace in the United States through its indirect operating subsidiaries. Local state laws where its subsidiaries operate permit such activities; however, these activities are currently illegal under United States federal law. Additional information regarding this and other risks and uncertainties relating to the Company's business is disclosed in the Company's public disclosure documents filed on SEDAR+ and www.sec.gov. Non-GAAP Financial Measures This press release contains certain non-GAAP financial measures. These measures are presented as supplemental information and should not be considered a substitute for, or superior to, financial measures prepared in accordance with GAAP. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in the financial schedules accompanying this release. Forward-looking non-GAAP guidance is provided on the basis described under "Guidance and Long-Term Growth Objectives."   SOURCE Grown Rogue International Inc. View original content to download multimedia: http://www.newswire.ca/en/releases/archive/May2026/12/c3762.html Contact: General Inquiries and Investor Contact: Obie Strickler, Chief Executive Officer, [email protected]; Investor Relations: [email protected], (458) 226-2662