By A.J. Herrington @ Forbes
Canadian cannabis operator High Tide filed financial for the first quarter of 2022 after the close of the equity markets on Thursday, reporting revenue of 72.2 million Canadian dollars ($57.1 million) for the three-month period ending January 31, an increase of 88% over the same quarter last year and 34% more than revenue reported for the fourth quarter of 2021.
High Tide, a cannabis company focusing on brick-and-mortar shops and e-commerce ventures, is the largest Canadian retailer of recreational marijuana as measured by revenue, with 113 current locations in Ontario, Alberta, Manitoba and Saskatchewan. The company has also been serving consumers for over a decade through its established e-commerce platforms including Grasscity.com, Smokecartel.com, Dailyhighclub.com and Dankstop.com.
More recently, High Tide has entered the hemp-derived CBD sector through Nuleafnaturals.com, FABCBD.com, BlessedCBD.co.uk, and BlessedCBD.de, as well as its wholesale distribution division under Valiant Distribution. Shares of High Tide (HITI) are sold on the NASDAQ and Toronto Stock Exchange equity markets, as well as on the Frankfurt Stock Exchange under the symbol 2LYA.
In its first quarter financial results, High Tide reported that gross profit increased 56% to CA$23 million compared to CA$14.8 million in the same quarter last year. Adjusted EBITDA for the first quarter of 2022 was CA$3.0 million, compared to CA$4.6 million for the same period last year. Overall, the company showed a net loss of CA$7.4 million, down 56% from the net loss of CA$16.8 million in the first quarter of 2021.
“I’m proud of our team delivering such a strong quarter in a challenging business environment. This past quarter’s results, showcasing 34% sequential revenue growth and 80% sequential increase in Adjusted EBITDA, re-affirms our exponential, yet sustained growth trajectory. Raj Grover, president and CEO of High Tide, said in a statement from the company. “We continue to execute on our business plan quarter after quarter by strategically expanding our business in Canada and internationally through organic growth and accretive [mergers and acquisitions] across our diversified ecosystem.”
High Tide Revenue Up Across The Globe
Geographically in the first quarter of 2022, CA$52.4 million of revenue was earned in Canada, CA$17.4 million in the United States and CA$2.3 million internationally. Compared to the first quarter of 2021, revenue increased by 53% in Canada, 346% in the United States, and 1,016% internationally.
“With these results, we have now achieved the second-highest quarterly revenue figure ever reported by a Canadian cannabis company that reports in Canadian dollars, and with our growth plans for the remainder of this year, we remain confident in further meaningful increases to our revenue profile,” added Grover. “As Canada’s largest cannabis retailer we continue to consolidate the bricks and mortar market at attractive multiples while simultaneously growing our e-commerce business portfolio.”
High Tide also noted featured operational milestones achieved this year, including reaching a total of 381,000 members in its loyalty program Cabana Club as of January 31, up from 245,000 at the launch of the company’s discount club model. The company also opened 6 new Canna Cabana locations, including three in Saskatchewan, two in Alberta, and another in Ontario.
Looking ahead, the High Tide intends to grow its Canadian retail store portfolio to at least 150 locations by the end of the 2022 calendar year, with a primary focus on the Province of Ontario. The company also plans to enter the British Columbia market in the near-term and will continue growing strategically in other Canadian provinces where it currently operates.
“Our forward-thinking approach makes us a leader amongst our peer group in Canada, as we keep introducing innovative retail concepts such as our discount club model, while remaining agile and pivoting quickly when needed due to the constantly evolving dynamics in the global cannabis landscape,” Grover said.
High Tide has scheduled a webcast and conference call to discuss the firm’s unaudited 2022 first quarter financial reports and outlook for 5:30 p.m. EDT on Thursday, March 17, 2022. The full set of Consolidated Financial Statements and Management’s Discussion and Analysis can be viewed by visiting High Tide’s website at www.hightideinc.com, and its profile page on SEDAR at www.sedar.com.