Two of Canada’s biggest cannabis retailers, Calgary, Alberta-based High Tide and Toronto’s Fire & Flower, reported small losses in their latest respective quarters.
However, one retailer is feeling the pinch from competitors more than the other.
High Tide reported a net loss of 8.2 million Canadian dollars ($6.3 million) for its quarter ended April 30 on soaring revenue. The loss is smaller than what High Tide incurred a year ago.
The CA$81 million in sales is approximately double High Tide’s revenue in the same quarter last year.
Fire & Flower, on the other hand, lost CA$9.9 million on declining revenue.
The retailer’s CA$40.1 million in sales in the quarter represent a significant decline from last year’s revenue of CA$44.1 million in the same three-month period.
Fire & Flower attributes its falling sales “primarily to increasing competition from new (licenses) issued and pricing pressures in the cannabis retail market.”
The business reported adjusted earnings before interest, taxes depreciation and amortization (EBITDA) of negative CA$2.3 million.
“Competitive pressures, (license) expansion outpacing market growth, and a growing value-oriented customer base have created challenging market conditions for the industry as a whole,” Fire & Flower noted in news release.
By segment, Fire & Flower generated:
- CA$29.6 million from its retail operations.
- CA$8.5 million from wholesale and logistics.
- CA$2.9 million from its digital platform.
Fire & Flower said it had 101 stores open and in operation as of April 2022, compared with 79 in the same period of 2021.
High Tide is the largest nonfranchised recreational marijuana retailer in Canada with 126 stores.
The retailer is aiming to reach 150 stores by the end of this year and expects to enter the British Columbia market this summer.
High Tide reported adjusted EBITDA of CA$2.4 million – its ninth straight quarter of positive adjusted EBITDA.
Sales doubled in the three months ended April 30, 2022, over the same quarter one year ago.
Geographically, 78% of High Tide’s sales (CA$63.5 million) came from Canada, CA$15.9 million from the United States and CA$1.6 million from overseas.
Data sales were CA$5.1 million in the second quarter.
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