The Green Rush is all but over, proclaimed Green Thumb Industries (CSE: GTII) (OTCQX: GTBIF) CEO Ben Kovler this week in the company’s fourth quarter earnings call.
“Concerns around price compression in our industry are very real. The days of fat margins and easy money and cannabis are waning,” Kovler warned shareholders during the call on Tuesday, after his company posted a $51 million loss for the final quarter of 2022.
Kovler said more industry contraction is on the way, despite market forecasts that project continuing growth.
“We are in the midst of a washout that will leave the industry with fewer operators, not more. This is ironic as politicians and operators are talking about including more folks, not less,” Kovler said, adding that “pricing pressure has squeezed margins.”
Kovler said that the broader economic downturn is partly to blame, along with inflation, increasing interest rates, and an expected recession. He predicted the failure of a good number of cannabis companies in the near future because “tremendous growth” has attracted “a lot of prospectors and get-rich-quick hopefuls.”
“For a variety of reasons, these folks will get caught and eaten by the bear,” Kovler said, adding that he thinks a lot of social equity companies will fall into that category.
“It’s taking too long for state social equity programs to achieve meaningful results,” Kovler said, and ruminated on the “dimming promise for fresh participation in this industry” by minorities.
“We look out and continue to see an industry that can triple in size over the next decade, and while we have entered the middle innings, this is a marathon and not all runners will finish,” Kovler said.
March 3, 2023 at 1:13 am
Fuck that dude. You keep prices artificially inflated to dishonorably gouge customers. Any multimillionaire is a fucking scammer cheating the tax system to perpetually fuck you harder and harder. Fuck every individual “earning” 8 figures per year with a barbed-wire-wrapped telephone pole.