You’re reading a copy of this week’s edition of the New Cannabis Ventures weekly newsletter, which we have been publishing since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve as well as links to the week’s most important news.
Friends,
The publicly-traded cannabis industry has had a busy week with many companies reporting their quarterly financials. Today, we’re going to go over some of our exclusives and recap earnings from the week.
Cannabis Sales
Michigan’s cannabis market was a mixed bag with medical sales falling 44.2% from a year ago to $27 million in April, while adult-use sales shot up 59.7% to $168 million. Flower pricing for adult-use continued the decline, decreasing 45.9% from a year ago.
Exclusive Interviews
New Cannabis Ventures provided our readers with insight from industry leaders including an exclusive interview with urban-gro Chairman and CEO Bradley Nattrass. We also interviewed Leaf Trade Founder and CEO James Yi and President and Chief Revenue Officer Michael Piermont on their B2B ecommerce marketplace for the cannabis industry. We spoke with “Fast Money” co-host Tim Seymour, who is also CIO of Seymour Asset Management and who launched a cannabis ETF in 2019. He told NCV that while the cannabis industry has struggled over the last few months, he is excited to see assets starting to recover.
Earnings Recap
Trends and data point to the continued growth of the cannabis industry. Despite the recent challenges, some companies are moving ahead with expansion plans. Glass House Brands said it will acquire 100% of the equity interests in three retail assets: two operating retail dispensaries and one retail dispensary slated to open in Q3 2022, all in California. At the same time, the company reported net sales fell 24% compared to prior quarter to $14 million, down 8% from a year ago. Lowell Farms Q1 revenue grew 13% from a year ago and declined 18% sequentially to $12.4 Million. CEO Mark Ainsworth noted that Lowell has taken the lead as California’s largest combined seller of packaged flower and all-flower pre-rolls in California per Headset.
Curaleaf reported revenue increased 20% to $313.1 million during the first quarter of 2022, compared to $260.3 million in the first quarter of 2021. Although Curaleaf’s Q1 earnings were down 2% from the previous quarter, the company’s executive chairman Boris Jordan said he is confident in the company’s ability to hit full year revenue guidance of $1.4 billion to $1.5 billion.
Other Q1 winners include Nova Cannabis with sales of C$49.8 million, a 171% increase from the first quarter of last year and a 5% sequential growth. urban-gro got off to a strong start in 2022, reporting record Q1 revenue of $21.1 million, up 76% from a year ago and 11% sequentially. Goodness Growth reported revenue for the three-months ended March 31 was $15.6 million, up 14% sequentially and 18% compared to a year ago.
Agrify saw a record 271% revenue growth year-over-year in Q1 to $26 million, while sequential growth was 3%. MariMed reported financial Q1 results with revenues at $31.3 million, up 27% from the same quarter a year ago and 1% sequentially. Trulieve saw a record Q1 with revenues of $318.3 million, up a whopping 64% year-over-year and 4% sequentially.
TerrAscend saw Q1 net sales inch up to $49.7 million from $49.2 million in the previous quarter, down 7% from a year ago. IM Cannabis reported it was on its way to profitability with Q1 revenue at C$23.6 million, up 169% year-over-year and 18% sequentially. The company said its WAGNERS brand sold out in Israel in three weeks.
More Below…
urban-gro engineers & designs high-performance cultivation facilities
Located in the U.S. and operating globally, urban-gro has engineered and designed nearly 500 controlled environment agriculture facilities, spanning over five million square feet. The company provides services to MSOs as well as Canadian LPs who require GMP certification. urban-gro, which trades on the NASDAQ, continues to see huge demand for sustainable controlled-environment agriculture facilities.
Get up to speed by visiting the urban-gro Investor Dashboard that we maintain on their behalf as a client of New Cannabis Ventures. Click the blue Follow Company button in order to stay up to date with their progress.
GrowGeneration took a hit in Q1 with net sales declining 9% year-over-year and 10% sequentially to $81.8 million. The company blamed it on softer demand. President and Co-Founder Darren Lampert says they will be “aggressively right-sizing” the cost structure and remain committed to their strategic initiatives. Cronos Group consolidated revenue jumped 99% to $25 million, up from $12.6 million in the first quarter of 2021, and decreased 3% sequentially. Village Farms reported Q1 cannabis sales declined 16% from the previous quarter to $28.8 million, up 66% year-over-year.
Hydrofarm reported net sales for Q1 remained flat at $111.4 million. Ascend Wellness reported revenue decreased 4% quarter-over-quarter to $85.1 million, up 29% year-over-year. The company also resolved its previously announced lawsuit against MedMen NY, Inc. and MM Enterprises USA, LLC. The agreement calls for MedMen to complete the sale of MedMen NY, Inc. to Ascend, and upon closing, Ascend will enter its seventh state.
Aurora Cannabis said Q3 total net revenue fell 9% to $50.4 million from $55.2 million in the same quarter a year ago and 17% sequentially. iAnthus Q1 revenue saw a sequential 10% revenue decrease to $42.8 million and a 17% decline year-over-year.
NewLake Capital Partners entered a five-year revolving credit facility with a $30 million initial commitment. However, the amount could increase to $100 million as lenders are added. The company’s President and Chief Investment Officer Anthony Coniglio said access to additional capital will allow the company to continue investing in high-quality assets in the growing cannabis industry and noted, “the revolving nature of this facility will help us to efficiently manage our capital usage.”
XS Financial expanded its relationship with one of its longest-tenured customers, Ayr Wellness, by increasing its lease facility up to $37.4 million, including an immediate drawdown of $12 Million, bringing the total usage to over $33.1 million.
In the coming week we look forward to more earnings reports to be released.
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Sincerely,
Alan & Joel
info@newcannabisventures.com
