It’s Time For Cannabis Companies To Report Financial Updates

The Public Cannabis Company Revenue & Income Tracker, managed by New Cannabis Ventures, ranks the top revenue producing cannabis companies. This update is our first since late November, and there will be many financial releases very soon.

Tracker Rules

This data-driven, fact-based tracker will continually update based on new financial filings so that readers can stay up to date. Companies must file with the SEC or SEDAR and be current to be considered for inclusion. When we launched this resource in May 2019, companies with quarterly revenue in excess of US$2.5 million qualified. As the industry has scaled and as more companies have gone public, we have raised the minimum several times subsequently, including a move to US$5 million in October 2019, to US$7.5 million in June 2020, to US$10 million in November 2020 and US$12.5 million in August 2021. Due to the rapid growth in the cannabis industry, we raised the minimum to US$25 million (C$33.8million) to qualify for what we now call the senior list and introduced a junior list with a minimum of US$12.5 million (C$16.9 million) in September 2021.

A Note About Adjusted Operating Income

In May 2019, we added an additional metric, “Adjusted Operating Income”, as we detailed in our newsletter. The calculation takes the reported operating income and adjusts it for any changes in the fair value of biological assets required under IFRS accounting. We believe that this adjustment improves comparability for the companies across IFRS and GAAP accounting. We note that often operating income can include one-time items like stock compensation, inventory write-downs or public listing expenses, and we recommend that readers understand how these non-cash items can impact quarterly financials. Many companies are moving from IFRS to U.S. GAAP accounting, which will reduce our need to make adjustments. Please note that our rankings include only actual reported revenue and not pro forma revenue. We also note that companies with non-cannabis operations must provide segment-level financial reports that detail not only revenue but also operating profit to be have their operating profit included in the tracker. Currently, Aurora Cannabis (NASDAQ: ACB) (TSX: ACB), Ispire (NASDAQ: ISPR), Jazz Pharma (NASDAQ: JAZZ) and Tilray (TSX: TLRY) (NASDAQ: TLRY) aren’t providing this information.

Tracker Inclusion Updates

At the time of our last update on November 19th, 36 companies qualified for inclusion on the senior list, including 30 filing in U.S. dollars and 6 in the Canadian currency. Currently, 28 companies that file in U.S. dollars qualify and 6 that file in Canadian dollars are qualifying for the senior lists, a total of 34. The junior list now includes 11 companies reporting in U.S. dollars and 7 in Canadian dollars. On a combined basis, the Public Cannabis Company Revenue & Income Tracker now includes 52 companies. Since late November, we removed MedMen (OTC: MMNFF) (CSE: MMEN) for failure to file on time. We wrote about the evaporation of MedMen in December, when it was still trading above $0.01. Cansortium (OTC: CNTMF) (CSE: TIUM) moved from the junior list to the senior list, while 4Front (OTC: FFNTF) (CSE: FFNT) and iPower (NASDAQ: IPW) moved down to the junior list. Greenlane (NASDAQ: GNLN) was removed from the junior list, and two Canadian LPs joined the Canadian junior list.

Included Companies That Reported since November

Since our last update, several companies that generate substantial revenue have reported. The largest companies are set to share numbers beginning this week.

Senior and Junior – American Dollar Reporting

The two companies that have reported recently with high revenue are Scotts Miracle-Gro (NYSE: SMG) and Tilray Brands (NASDAQ: TLRY) (TSX: TLRY). The cannabis-focused part of Scotts Miracle-Gro, Hawthorne  Gardening Company, reported a very large decline in revenue and a big operating loss in its fiscal Q1. Tilray’s cannabis operations saw revenue decline 5% from a year ago in its fiscal Q2.

The 4 largest MSOs are expected to report this week and in March. Curaleaf (OTC: CURLF) (CSE: CURA) has scheduled a call on March 6th, and analysts project that revenue will decline by 9% from a year ago to $182 million. Green Thumb Industries (OTC: GTBIF) (CSE: GTII) is expected to have seen 4% revenue growth in Q4 to $270 million. Analysts project that Trulieve (OTC: TCNNF) (CSE: TRUL) Q4 revenue fell 11% to $268 million, while they expect that Verano (OTC: VRNOF) (CSE: VRNO) grew Q4 revenue by 4% to $234 million.

Senior and Junior – Canadian Dollar Reporting

High Tide (NASDAQ: HITI) (TSXV: HITI) is the only Canadian company that reported recently with quarterly revenue above C$100 million. Its fiscal Q4 revenue increased slightly from its Q3. Canopy Growth (NASDAQ: CGC) (TSX: WEED) recently reported fiscal Q3 revenue that fell 8% from a year ago as the share-count expanded substantially.

Stay up to date

Visit the Public Cannabis Company Revenue Tracker to track and explore the complete list of qualifying companies. Readers can access our library of Revenue Tracker articles. For our readers who are interested in staying on top of scheduled earnings calls in the sector, we have created and continually update the Cannabis Investor Earnings Conference Call Calendar.

Exclusive article by Alan Brochstein, CFA
Alan Brochstein, CFA
Based in Houston, Alan leverages his experience as founder of online community 420 Investor, the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. At New Cannabis Ventures, he is responsible for content development and strategic alliances. Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 at Seeking Alpha, where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alan: Twitter | Facebook | LinkedIn | Email

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