Public Cannabis Companies Wrap Up a Year of Strong Revenue Growth

The Public Cannabis Company Revenue & Income Tracker, managed by New Cannabis Ventures, ranks the top revenue producing cannabis stocks that generate industry sales of more than US$12.5 million per quarter (C$16.1 million). 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. Please note that we have raised the minimum quarterly revenue several times as the industry has scaled up, including from US$10.0 million in November 2020, US$7.5 million in June 2020, US$5.0 million in October 2019 and US$2.5 million in May 2019.

38 companies currently qualify for inclusion, with 27 filing in U.S. dollars and 11 in the Canadian currency, which is unchanged from our update a month ago. We continue to expect additional companies to qualify in the future.

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 included in the tracker.

In December, only MedMen (CSE: MMEN) (OTC: MMNFF) provided a financial update among those companies reporting in American dollars.  In contrast to peers, it experienced a substantial decline over the past year in revenue during its fiscal Q1. Its revenue bounced back from a very weak Q4 as it also improved its adjusted operating loss.

American Dollar Reporting – Public Cannabis Company Revenue Tracker

In January, only KushCo Holdings (OTC: KSHB) will be reporting financials. According to Sentieo, analysts expect the fiscal Q1 revenue will increase 8% sequentially to $26.8 million. Analysts expect the company to report positive adjusted EBITDA for the second consecutive quarter as well. The company has provided full-year guidance for revenue to be $120-150 million, with adjusted EBITDA expected to be $5-7 million.

Since our last update, Fire & Flower (TSX: FAF) (OTC: FFLWF) and Organigram (TSX: OGI) (NASDAQ: OGI) reported quarterly financials.  Fire and Flower reported revenue of C$31.1 million in its fiscal Q3, ahead of analyst estimates and up 16% sequentially. The company narrowed its adjusted operating loss as it reported positive adjusted EBITDA for the first time. Organigram fiscal Q4 revenue advanced 13%, also ahead of analyst estimates, though its adjusted operating loss was negatively impacted by one-time charges.

Canadian Dollar Reporting – Public Cannabis Company Revenue Tracker

During January, several companies will report, including Aphria (TSX: APHA) (NASDAQ: APHA), Liberty Health Sciences (CSE: LHS) (OTC: LHSIF), Organigram and Valens Company (TSX: VLNS) (OTC: VLNCF).

Aphria’s fiscal Q2 ending in November is expected to have seen revenue grow 5% sequentially, according to Sentieo, to $153 million, which includes substantial non-cannabis revenue. Liberty Health, which has announced its pending sale to Ayr Strategies (CSE: AYR.A) (OTC: AYRWF) is very likely to fall off the list, as its sales will almost certainly decline substantially from its fiscal Q2 and could possibly decline from a year ago, based on data published by Florida. Organigram fiscal Q1 revenue is expected to increase by about 5% sequentially to C$21.4 million. Valens fiscal Q4 revenue for its year ending in October is expected to advance 20% sequentially to C$21.7 million.

For those interested in more information about companies reporting, we publish comprehensive earnings previews for subscribers at 420 Investor, including for Focus List members Aphria, KushCo Holdings and Organigram.

Visit the Public Cannabis Company Revenue Tracker to track and explore the complete list of qualifying companies. We have recently created a way for our readers to 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 have created and continually update the Cannabis Investor Earnings Conference Call Calendar.

Get ahead of the crowd by signing up for 420 Investor, the largest & most comprehensive premium subscription service for cannabis traders and investors since 2013.

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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