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GLAS, Glass House Brands Inc.

Pharmaceuticals consumer brand UnprofitableDistress / turnaround

A pharmaceutical business, where patents grant a temporary monopoly the pipeline must keep refilling.

Latest annual: FY2025 40-F

GLAS · Glass House Brands Inc.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$182M

−9.4% YoY · 30% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $182M 5-yr avg $138M

Gross margin 42% 5-yr avg 38%

Operating margin −9.1% 5-yr avg −32.1%

ROIC −9% 5-yr avg −13%

Owner-earnings margin −2% 5-yr avg −17%

Free cash flow margin −9% 5-yr avg −55%

The business in brief

What this business is and what moves its needle, from its own SEC filings.

Situation: Unprofitable. No sustained operating profit across the record; an earnings multiple has nothing to rest on. What the record does show is revenue, the gross-margin trajectory, and the burn against the cash on hand. Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock.
What moves the needle: Operating margin has run around −31% through the cycle on a 39% gross margin, the operating line deeply negative — so the lever is the path to a margin at all: revenue growth against the cost curve and the cash runway, not the level of a margin that isn't there yet. Read this kind of business on the pipeline against the patent cliff, and pricing.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −12%, above 15% in 0 of 6 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2020–2025

realized figures from each filing · older years to the left

2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMDec 2025
							Income statement
$48M	$63M	$85M	$161M	$201M	$182M	$182M	RevenueRevenue
39%	25%	24%	50%	48%	42%	42%	Gross marginGross mgn
($6M)	($36M)	($56M)	($50M)	$6M	($17M)	($17M)	Operating incomeOp. inc.
−12.4%	−57.2%	−66.4%	−30.8%	2.9%	−9.1%	−9.1%	Operating marginOp. mgn
($17M)	($43M)	($33M)	($98M)	$721K	($29M)	($29M)	Net incomeNet inc.
							Cash flow & returns
($8M)	($20M)	($41M)	$23M	$28M	$11M	$11M	Operating cash flowOp. cash
$2M	$5M	$11M	$14M	$14M	$15M	$15M	DepreciationDeprec.
$7M	$18M	($19M)	$108M	$13M	$25M	$25M	Working capital & otherWC & other
$4M	$108M	$28M	$12M	$10M	$27M	$27M	CapexCapex
8.0%	171.7%	32.7%	7.7%	5.1%	14.9%	14.9%	Capex / revenueCapex/rev
($10M)	($25M)	($52M)	$11M	$18M	($4M)	($4M)	Owner earningsOwner earn.
−20.9%	−39.4%	−61.4%	6.8%	9.0%	−2.0%	−2.0%	Owner earnings marginOE mgn
($12M)	($129M)	($69M)	$11M	$18M	($16M)	($16M)	Free cash flowFCF
−23.9%	−203.8%	−80.8%	6.8%	9.0%	−8.6%	−8.6%	Free cash flow marginFCF mgn
-11%	-13%	-19%	-25%	2%	-9%	-9%	ROICROIC
-63%	-24%	-20%	-109%	1%	-39%	-39%	Return on equityROE
−63%	−24%	−20%	−109%	1%	−39%	−39%	Retained to equityRetained/eq
							Balance sheet
$5M	$2M	$5M	$4M	$5M	$4M	$4M	ReceivablesReceiv.
$7M	$7M	$11M	$9M	$14M	$26M	$26M	InventoryInvent.
$3M	$4M	$6M	$6M	$9M	$14M	$14M	Accounts payablePayables
$9M	$5M	$10M	$7M	$11M	$17M	$17M	Operating working capitalOper. WC
$18M	$69M	$39M	$49M	$66M	$68M	$68M	Current assetsCur. assets
$20M	$55M	$54M	$87M	$66M	$38M	$38M	Current liabilitiesCur. liab.
0.9×	1.2×	0.7×	0.6×	1.0×	1.8×	1.8×	Current ratioCurr. ratio
$5M	$5M	$38M	$0	$0	—	$0	GoodwillGoodwill
$70M	$288M	$351M	$304M	$311M	$319M	$319M	Total assetsAssets
$16M	$45M	$63M	$64M	$58M	$69M	$69M	Total debtDebt
$16M	$45M	$63M	$64M	$58M	$69M	$69M	Net debt / (cash)Net debt
-2.8×	-13.2×	-7.4×	-5.0×	0.6×	-2.3×	-1.7×	Interest coverageInt. cov.
$26M	$182M	$169M	$90M	$116M	$74M	$74M	Shareholders’ equityEquity
							Per share
21.3M	40.3M	64.2M	72.0M	75.2M	81.9M	81.9M	Shares out (diluted)Shares
$2.27	$1.57	$1.32	$2.23	$2.67	$2.22	$2.22	Revenue / shareRev/sh
$-0.78	$-1.07	$-0.51	$-1.36	$0.01	$-0.35	$-0.35	EPS (diluted)EPS
$-0.47	$-0.62	$-0.81	$0.15	$0.24	$-0.04	$-0.04	Owner earnings / shareOE/sh
$-0.54	$-3.20	$-1.07	$0.15	$0.24	$-0.19	$-0.19	Free cash flow / shareFCF/sh
$0.18	$2.69	$0.43	$0.17	$0.14	$0.33	$0.33	Cap. spending / shareCapex/sh
$1.24	$4.52	$2.63	$1.25	$1.55	$0.90	$0.90	Book value / shareBVPS

The diluted share count moved ×1.89 into 2021 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×1.59 into 2022 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

Per-share growththe realized rate an owner's share compounded

	5-yr	5-yr
Revenue / share	−0.4%/yr	−0.4%/yr
Capital spending / share	+12.9%/yr	+12.9%/yr
Book value / share	−6.1%/yr	−6.1%/yr

The record, charted

FY2020–2025

Each measure over its full record; the current point and the worst year marked.

Share count

82Mpeak FY2025

ROIC

−9%low FY2023

Gross margin

42%low FY2022

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

($4M)owner earningsvs.($29M)net incomelow FY2022

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2023FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business earned ($4M) of owner earnings, the operating cash left after the $15M it takes just to hold its position. It put $12M more into growth; free cash flow, after that spending, was ($16M).

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	($29M)	$721K	($98M)	($33M)	($43M)
Depreciation & amortizationnon-cash charge added back	+$15M	+$14M	+$14M	+$11M	+$5M
Working capital & othertiming of cash in and out, other non-cash items	+$25M	+$13M	+$108M	−$19M	+$18M
Cash from operations	$11M	$28M	$23M	($41M)	($20M)
Maintenance capital expenditurethe spending needed just to hold position and volume	−$15M	−$10M	−$12M	−$11M	−$5M
Owner earnings	($4M)	$18M	$11M	($52M)	($25M)
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$12M	—	—	−$16M	−$104M
Free cash flow	($16M)	$18M	$11M	($69M)	($129M)
Owner-earnings marginowner earnings ÷ revenue	-2%	9%	7%	-61%	-39%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $15M, roughly its depreciation, the rate its assets wear out). The other $12M of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 40-F · source on SEC EDGAR →

Will it survive?

Can it pay its interest? -1.7×

Does not cover its interest

Operating income ($17M) ÷ interest expense $10M

What this means
A full year of operating profit didn't cover the interest bill. This is the zombie zone: the business depends on refinancing, asset sales, or forbearance to service its debt.
How heavy is the debt, net of cash? $69M

Net debt against an operating loss

Cash $0 − debt $69M

What this means
Netting $0 of cash and short-term investments against $69M of debt leaves $69M owed, with no operating profit this year to measure it against — understand that combination before anything else about the company. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 52d

Tight

DSO 9 + DIO 91 − DPO 48 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital -13%

Below average through the cycle

6-yr median, range -25%–2%; -9% latest = NOPAT ($13M) ÷ invested capital $143M

Industry peers: median -50%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 6 years (it ran -9% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin -21%

Consumes cash through the cycle

6-yr median margin, range -61%–9%; latest ($4M) = operating cash $11M − maintenance capex $15M

Industry peers: median -107%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -2% of revenue this year, a -21% median across 6 years. It chose to put $12M more into growth, so free cash flow this year was ($16M) — the gap is investment, not weakness.
Are earnings backed by cash? $11M

Loss, but cash-generative

Net income ($29M) · cash from operations $11M

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did.

How is the cash used?

Where do the earnings go? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 1.81×

Expanding

Capex $27M ÷ depreciation $15M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 0 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $182M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Near

Current ratio ≥ 2× · 1.78×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Miss

Debt ≤ working capital · $69M vs $30M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (6-yr record) · 5 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-0.51/share (latest year $-0.35), the averaged base the calculator's gate runs on, and book value is $0.90/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2020–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 1 of 6

What this means
Lost money in 5 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 6 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin −45% → −12% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about −45% early to −12% lately, median −31% — pricing power intact or improving.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Worst year 2022 · −66.4% op. margin

What this means
Operations went underwater in 2022, understand why before trusting the good years.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of fiscal year-end, Dec 31, 2025

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$68M

Receivables$4M
Inventory$26M
Other current assets$37M

Current liabilities$38M

Debt due within a year$37K
Accounts payable$14M
Other current liabilities$24M

Current ratio1.78×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.09×stricter: inventory excluded

Cash ratio0.00×strictest: cash alone against what's due

Working capital$30Mthe cushion left after near-term bills

Debt due this year vs. cash$37K due · $0 cash cash alone won't cover the maturities; it leans on refinancing or operating cash · both figures from the Dec 31, 2025 balance sheet

Deeper floors

Tangible book value$62Mequity stripped of goodwill & intangibles

Net current asset value($76M)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$70M$1M of it operating leases

From the company's latest filing.

Inverting the record

Invert: instead of why Glass House Brands Inc. is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2020–2025.

1 of the 3 tests turned up something to look into; the other 2 came back clean.

Look hereDid debt outgrow the business?$16M → $69M
Debt rose from $16M to $69M while owner earnings went from about ($29M) to $8M: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.

And these came back clean

Is it less profitable than it was?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Pharmaceuticals

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
RYTMRhythm Pharmaceuticals Inc.	$190M	90%	-238.1%	-67%	-176%
MRVIMaravai LifeSciences Holdings Inc.	$186M	53%	16.8%	-32%	21%
STOKStoke Therapeutics Inc.	$184M	—	-559.3%	-79%	-254%
GLASGlass House Brands Inc.	$182M	41%	-21.6%	-12%	-11%
CYRXCryoPort Inc.	$176M	46%	-44.0%	-14%	-17%
PHATPhathom Pharmaceuticals Inc.	$175M	86%	-502.2%	—	-483%
DNAGinkgo Bioworks Holdings Inc.	$170M	—	-246.5%	-351%	-105%
CRONCronos Group Inc. Common Share	$147M	—	-168.7%	-23%	-107%
Group median	—	53%	-203.4%	-32%	-106%

The price

What a price has to assume.

What the price implies

reverse-DCF

Enter the home-market price, not the US ADR quote. Glass House Brands Inc. reports in USD, and every figure here (owner earnings, book value, the share count) is on that ordinary-share basis. Enter the price on the same basis: the local-exchange quote per ordinary share. A US ADR price in dollars bundles the ADR-to-ordinary ratio, so it will not reconcile with these figures and would throw the multiple off.

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Glass House Brands Inc. has delivered.

Glass House Brands Inc.’s latest year shows negative owner earnings, the mark of a build-out: total capital spending outruns the cash the business throws off today. So the tool opens on the steady-state base (maintenance capex in place of the build-out spend), the cash it would earn at rest; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Base Normalize · through-cycle ($4M) Net of stock comp Steady-state · maintenance capex (($4M))

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth, delivered—

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow ($16M) on 82M shares outstanding (a weighted average, the only count this filer tags); net debt $69M. The base opens on the steady-state figure (the latest year is negative on total capex mid-build-out); clear Steady-state to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($27M) runs well above depreciation ($15M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about ($4M), the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh GLAS against another business →

Cite: Owner Scorecard, "Glass House Brands Inc. (GLAS), the owner's record," https://ownerscorecard.com/c/GLAS, data as of 2026-07-09.

Manual order: ← GILT its page in the Manual GLBE →

Industry order: ← GERN the Pharmaceuticals chapter GRCE →