MedMen Enterprises Inc. (MMNFF) released its unaudited retail revenue for its fiscal 2018 fourth quarter ending June 30, 2018. Across the company’s operations in California, Nevada and New York, systemwide retail revenue was $19.2 million or C$25.2 million.
MedMen stock jumped over 6% in early trading as this is the first glimpse of financial data that shareholders have gotten since the company went public at the beginning of summer.
MedMen’s stores in Southern California delivered most of the company’s revenues for the quarter. Seven of its retail locations reports a combined $17.4 million in revenue, with an average retail markup over wholesale of 90%. MedMen said that the stores serviced 94,000 new customers and had nearly 130,000 returning customers, with an average spend per transaction of US$77.76. This translates into an annualized per square foot revenue of $6,541. By comparison, according to CoStar, the average sales per square foot for an Apple store is approximately US$5,546 (CA$7,282) and approximately US$2,951 (CA$3,875) for Tiffany & Co stores.
The company did not count sales from its Abbot Kinney store which just opened in early June. The company also just opened its first branded store in downtown Las Vegas in July and recently won approval to operate a second location near the Hard Rock Hotel, the Thomas and Mack Center and McCarran International Airport, set to open in October.
“Retail is the key to the fast-evolving cannabis industry. It is where brands are built and where the margins can be maintained,” said Adam Bierman, MedMen chief executive officer, and co-founder. “The rapid revenue growth in our California stores, only six months into recreational sales, is a solid reflection of our continued execution of our business thesis. We will remain focused on our strategy and the kind of growth that generates long-term value for our shareholders.”
If shareholders are looking for profits, losses or additional financial information, they will have to wait until October when the company plans on releasing its audited 2018 full year results.
MedMen has been fighting against a torrent of negative publicity since the company began publicly trading. The company faced criticism for its generous executive pay and voting rights on shares. Since then, MedMen adjusted the way the executive payout would be calculated. Many other cannabis companies have followed a similar path with regards to the voting rights on shares and haven’t been subjected to the same level of vitriol.
The company has also been targeted for the way it handled an employee tip accounting issue. The company said it hadn’t been taking out taxes for tips that employees earned and when it made the correction hadn’t effectively warned its employees they would experience a big hit in their paychecks.
The stock that trades on the Canadian Securities Exchange jumped over 7% in after hours trading on the sales data to lately trade at C$4.31, down from its year high of roughly C$5.69. The OTC Markets listing was also up 6% in after-hours trading to lately trade at $3.28, down from its year high of $4.99.