Florida Archives - Green Market Report

Adam JacksonNovember 30, 2022
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7min7760

Cansortium Inc. (CSE: TIUM.U) (OTCQX: CNTMF) stock rose more than 8% in trading early Wednesday after the company posted a much-improved balance sheet despite Hurricane Ian affecting sales in Florida toward the end of the period.

The U.S.-based cannabis company, which operates under the Fluent brand with locations in Florida, Pennsylvania, and Texas, released its financial and operating results for the third quarter ending Sept. 30.

Revenue rose 42% to $22.1 million versus $15.6 million in the same time period last year. Net loss was $5.5 million versus a net income of $7.3 million last year’s third quarter.

“We continued to execute on our profitability objectives during the third quarter, leading to another period of gross margin expansion and a record bottom line with strong cash flow generation,” said CEO Robert Beasley.

The CEO added that the company would have generated its eleventh consecutive quarter of revenue growth, “had it not been for Hurricane Ian driving store closures in late September.”

“As we exit the year and look to 2023, we expect to continue opening new stores in Florida while driving organic growth in our three Pennsylvania dispensaries,” he said. “We also have plans to begin building out our footprint in Texas and look forward to growing our presence in the state in 2023.”

In a statement, the company said that its newest dispensary in Annville, Pennsylvania, is “ramping and achieved a record month of sales in October 2022.”

Adjusted gross profit rose 71% to $16.7 million, or 75.5% of revenue, versus $9.8 million or 62.7% of revenue last year.

Adjusted EBITDA shot up 140% to a record $11.7 million or 53.1% of revenue, versus $4.9 million or 31.3% of revenue in 2021’s third quarter.

The company has also been maintaining its sheet, with cash from operations rising to $5.4 million versus a negative cash burn of $4.2 million during the same time last year.

Cansortium had around $9.1 million of cash and cash equivalents and $69.4 million of total debt by the end of the third quarter, with around 252.3 million fully diluted shares outstanding.

Being cash flow positive “helps us now build our stores without the need for any type of capital raise or any kind of loan funds,” the CEO told investors on a call to discuss the latest earnings.

“Start low and go slow is kind of the industry model and I believe that’s the right answer for us as well. We already did the over-expansion in the over-horizontal-expansion game, and that was no fun,” he said. “Pulling back from that was a tremendous effort. So, let’s just grow in sequence and grow in balance. To grow in balance at that point (you don’t need more stores. You’ve got to feed more stores. So, you’ve got to go back to the other end of the stream.”

Florida

Cansortium plans on opening one new store in the Sunshine State by the end of 2022, in addition to three stores in the first half of 2023. All of these locations are currently under contract and going through construction, the company said.

Beasley noted that Hurricane Ian gave the chain some trouble during the quarter, too, as twelve of its dispensaries having to temporarily closed. While stores saw spiked sales ahead of closings and right after reopenings, the company said that all of the stores eventually reopened by the following month.

“It just goes to prove that clean water or drinking water, toilet paper, and cannabis are the three things that you need in front of a storm,” he said, “because the sales were tremendous.”

Florida also allows a crop loss purchase, which means if you have an approved loss of crop by the Department of Health, an operator can replace that crop through wholesale purchase.

“We expected it be completely flattened and it wasn’t,” Beasley said on Tuesday’s earnings call. “And so the DOH said to us, do a rough calculation of what your losses could be and you can go ahead and buy” wholesale from other operators in Florida.

“We had this extraordinary scenario where we had multiple competitors reach out and say, ‘Hey, if you need to buy from us, we will sell to you.’ And that’s unusual in Florida. We’re not wholesale oriented. And so the idea of selling to your competitors is just not something that is available here. For them to reach out, it was just a tremendous, generous move on their part.”

Florida revenue increased 39% to $18.2 million versus $13.1 million by the end of the same quarter last year.

Outlook

While Cansortium said it continued to make progress on its strategy for shareholders, the company lowered its previously issued revenue projection for 2022. The company now expects revenue for 2022 to run between $85 million-$90 million, down from last quarter’s expectations of $90 million-$95 million. The company also expects to close the fiscal year with adjusted EBITDA surpassing its previously issued guidance of $25 million-$28 million.

“So and again, go back to our Q3 expectations. I was asked this at the end of Q2, which is — our Q2 was so great, why am I not adjusting guidance? It’s because we anticipated Q3 to be flat. We were hoping for it to be flat or slightly up. I think we would have been slightly up, but for a Hurricane no one could predict that,” Beasley told investors.

“But you got to remember, we’re in Florida and our patients all leave town in the summer because it’s hot, so we traditionally see decreased sales in August in July. So, we knew that was coming and we were hoping to hold on to flat. We would have, but for the Hurricane.”


StaffOctober 4, 2022
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6min9070

The Daily Hit is a recap of cannabis business news for October 4, 2022.

ON THE SITE

Cantor Gives Irwin Naturals a $7 Target Price

Cantor Fitzgerald analyst Pablo Zuanic initiated coverage on supplement company Irwin Naturals Inc. (OTC: IWINF) with an overweight rating and a $7 price target. The stock currently trades at roughly $1.58 per share. The shares are listed on the Canadian Securities Exchange (CSE), and with limited free float, but a NASDAQ listing is possible in the future. Read more here.

GOP Tries To Tie Cannabis To Suicide, Violent Crime

Archconservative Republicans and their network of influence have recently taken a staunch stand against the legalization of marijuana. The largest Congressional GOP faction affirmed its national position on cannabis, saying that it should remain federally prohibited and suggested adolescent consumption could be tied to suicide and violent crime with more studies. Read more here. Read more here.

Psychedelics Law Being Prepped For Florida

While Florida digs out of the extensive damage caused by Hurricane Ian, the business of lawmaking and regulation for the medical psychedelics industry continues, with the hope of quickening access to psychedelics for the large veteran population in the state and for others needing access to legalized mental health treatment in the state. Read more here.

Medical Marijuana Inks Asset Purchase Deal To Expand Hemp Footprint

Medical Marijuana, Inc. (OTC: MJNA) — formerly known as GRN Holdings — has entered into an agreement to purchase assets from a hemp and natural wellness company for an undisclosed amount. Bill Andreoli, the president of seller MFINITY Global will become the president of Medical Marijuana, Inc. subsidiary, Kannaway, LLC. Read more here.

Not Everyone Is A Fan Of Fast-Tracked Psychedelics

While the psychedelic renaissance continues to gather steam, there is a growing uneasiness about the pace of the industry development. The excitement has been fueled specifically by three events: the report of MDMA going into Phase 3 clinical trial, the final phase of research on the road to FDA approval; the development of legalized psilocybin programs in Oregon (Measure 109) and elsewhere in the country; and the movements to decriminalize certain psychedelics that now includes 20 states (or a local government within the state) either already decriminalizing or looking into doing it soon. Read more here.

IN OTHER NEWS

Bright Green Corporation, Alterola Biotech Inc.

Bright Green Corporation (NASDAQ: BGXX), a company selected by the U.S. government to grow, manufacture, and sell cannabis and cannabis-related products for research, pharmaceutical applications and affiliated export, today announced that it has completed its previously announced strategic partnership and acquisition of 25% of the issued and outstanding common stock of Alterola Biotech Inc. (OTC PINK:ABTI), a U.K.-based pharmaceutical company focused on developing cannabinoid and cannabinoid-like medicines and products, for total consideration of $4 million. Read more here.

Biopharmaceutical Research Company

Biopharmaceutical Research Company, an active Drug Enforcement Administration (DEA) pharmaceutical cannabis license holder, announced the completion of a $20M Series A fundraise. This will enable the company to aggressively scale its operations and increase its product offering, conduct sponsored research, and execute on its go-to-market strategy. The round is being led by Intrinsic Capital Partners, with participation from Argonautic Ventures, Achari Ventures, AFI Capital Partners, Delta Emerald Ventures, Self Health America (SHAC) and a number of preeminent family offices. Read more here.

Decibel Cannabis Company Inc., Breath of Life International Ltd.

Decibel Cannabis Company Inc. (TSX-V: DB) (OTCQB: DBCCF), a cannabis producer, announced it has secured an on-going supply agreement with Breath of Life International Ltd. to launch Decibel’s Qwest brand and cannabis products in Israel. The supply agreement is for $4.8 million of premium cannabis product, with the first shipment expected in the fourth quarter. Read more here.

Sweet Leaf Madison Capital

Sweet Leaf Madison Capital, a nationwide provider of tailored debt financing solutions for the middle-market cannabis industry, today announced the closing of a loan for $207,000 to Koach Enterprises, a cannabis startup in California creating a high-end brand through vertical integration. The funds will be used to purchase energy-efficient, top-of-the-line LED grow lights from Spectrum King LED. Read more here.


Adam JacksonSeptember 26, 2022
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4min5550

Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) will launch Khalifa Kush medical cannabis products in Florida this weekend — part of an exclusive partnership with multi-platinum selling artist Wiz Khalifa.

Patients can visit any Trulieve location in Florida on October 1 for a chance to receive Khalifa Kush swag and prizes.

“I’ve always been driven to create art and products that change people’s perceptions or offer different experiences, so to me Khalifa Kush is a big part of that,” said Wiz Khalifa. “Trulieve is the perfect partner for us because of its commitment to providing the highest quality products and best possible patient experiences.”

Trulieve said that Wiz Khalifa will personally meet with Trulieve patients at three South Florida dispensaries on Saturday, October 1:

  • 1:00 p.m. @ Coral Springs – 10404 W Atlantic Blvd.
  • 2:30 p.m. @ Hollywood – 2908 Hollywood Blvd.
  • 4:00 p.m. @ North Miami Beach – 15100 Biscayne Blvd.

Each of the three event locations will provide patients branded merchandise and will feature live DJs. Khalifa will also offer limited meet-and-greet opportunities for patients.

“Trulieve is honored to have the iconic Wiz Khalifa as an exclusive partner in Florida to curate and promote his unique product line,” said Kim Rivers, CEO of Trulieve. “As an artist, he has such a strong vision of how he wants to express himself.”

The company said that a select number of patients at the three locations that Khalifa visits will receive tickets to attend the Saturday-night Khalifa Kush afterparty at the popular E11even nightclub in downtown Miami.

Trulieve said that the Khalifa Kush product line will expand to all statewide locations in the coming months. Khalifa Kush products are already available in Trulieve-owned and operated locations in Arizona.

“Together, we’ve created a line of products that offer best-in-class cannabis to Florida patients and represent the passion and creativity that Wiz Khalifa is known for,” Rivers said.


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