NCV increases inclusion requirements in revenue and revenue tracking of public cannabis companies – New Cannabis Ventures

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 $ 15 million per quarter (C $ 18.8 million ). This data and fact based tracker will be continually updated based on new financial documents so that readers can stay up to date. Companies must file with the SEC or SEDAR and be up to date to be considered for inclusion. Please note that we have increased the minimum quarterly revenue several times as the industry has grown, including US $ 12.5 million in August 2021, 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.

With the higher minimum income, 41 companies are currently eligible for inclusion, with 34 deposits in U.S. dollars and 7 in Canadian dollars, four fewer than when we reported a month ago. We added Organigram (TSX: OGI) (NASDAQ: OGI), which reports in Canadian dollars. We have removed Aphria from the Canadian section due to the merger with Tilray, and we have also removed Nova Cannabis ((TSX: NOVC) (OTC: NVACF) since it is no longer eligible. Among companies that report in dollars Americans, we removed Flower One (CSE: FONE) (OTC: FLOOF), Goodness Growth (CSE: GDNS) (OTC: GDNSF) and Cronos Group (TSX: CRON) (NASDAQ: CRON), as their first quarter revenues In addition, we have left GW Pharma in the US dollar reporting section and will either remove or replace it with its acquirer, Jazz Pharmaceutical (NASDAQ: JAZZ), depending on how the company allocates its financial performance, membership numbers in the coming months, but we also expect more companies to qualify.

In May 2019, we added an additional measure, “adjusted operating income”, as we detailed in our newsletter. The calculation takes reported operating profit and adjusts it for any change in the fair value of biological assets required by IFRS accounting. We believe that this adjustment improves the comparability of companies under IFRS and GAAP. We note that operating profit can often include one-time items such as stock compensation, inventory write-downs, or public listing expenses, and we recommend readers to understand how these non-monetary items can impact on quarterly financial results. Many companies are moving from IFRS accounting to US GAAP accounting, which will reduce our need for adjustments. Please note that our rankings only include actual reported income and not pro forma income. We also note that companies with non-cannabis related businesses are required to provide industry level financial reports that detail not only revenue but also operating profit to be included in the tracker.

Since our last update, Tilray (TSX: TLRY) (NASDAQ: TLRY), Turning Point Brands (NYSE: TPB) and KushCo Holdings (OTC: KSHB) were the only companies to report in US dollars to file financial statements. For Tilray, this was a transitional quarter, with three months of seniority at Aphria but only one month of seniority at Tilray included due to the merger closing schedule. Year-over-year growth was inflated by the inclusion of historic Tilray revenues as well as SweetWater beer revenues. Due to the company’s lack of segment information, we are unable to provide adjusted operating income for its cannabis-related businesses. Presumably, the vast majority of its $ 73.7 million GAAP operating loss in excess of the $ 33.3 million in transaction costs was related to its cannabis operations. We report the results of the Zig-Zag unit at Turning Point Brands, which saw 65% unit growth and gained 8% in terms of price and mix from a year ago. KushCo’s third quarter results were pre-announced at $ 27.5-28 million, and the company’s final results were slightly above its preliminary outlook.

U.S. Dollar Reporting – Revenue Tracking of Public Cannabis Companies

In the first two weeks of August, all of the largest companies by revenue will report, including Scotts Miracle-Gro (NYSE: SMG), Curaleaf (CSE: CURA) (OTC: CURLF), Green Thumb Industries (CSE: GTII) (OTC: GTBIF), Trulieve (CSE: TRUL) (OTC: TCNNF), Cresco Labs (CSE: CL) (OTC: CRLBF), Verano Holdings (CSE: VRNO) (OTC: VRNOF ), Hydrofarm (NASDAQ: HYFM), GrowGeneration (NASDAQ: GRWG), Harvest Health & Recreation (CSE: HARV) (OTC: HRVSF) and Columbia Care (NEO: CCHW) (CSE: CCHWF) (OTC: CCHWF).

Sentieo says Scotts Miracle-Gro is expected to report overall revenue for its fiscal third quarter of $ 1.46 billion, down 2% from a year ago, with EPS down 11% at $ 3.40. In early June, the company guided its Hawthorne gardening unit to increase sales in fiscal 2021 by more than 40%. Curaleaf is expected to generate revenue of $ 309 million in the second quarter, up 163% from a year ago. Analysts forecast GTI’s revenue to rise 72% to $ 205 million. Trulieve could overtake GTI as analysts predict revenue will rise 72% to $ 208 million. Cresco Labs is expected to have revenue of $ 195 million, up 106% from a year ago.

This will be the first full quarter of revenue from the combined merger of AltMed and Verano, which will sequentially increase revenue for the combined company, which has also added additional acquisitions. The company suggested revenue would approach $ 200 million for its second quarter. According to Sentieo, Hydrofarm is expected to increase sales 45% to $ 132 million in the second quarter. GrowGeneration, which has been a big buyer, is expected to have increased sales 157% to $ 112 million. Analysts expect Harvest to increase revenue 74% in the second quarter to $ 97 million. Columbia Care’s revenue is expected to have increased 285% to $ 109 million.

In July, Organigram (TSX: OGI) (NASDAQ: OGI) released its third fiscal quarter and Valens Company (TSX: VLNS) (OTC: VLNCF) released its second fiscal quarter. Organigram’s revenue exceeded expectations of C $ 16.45 million, while Valens was slightly below analysts’ expectations of C $ 22 million.

Canadian Dollar Reporting – Income Tracking of Public Cannabis Companies

In early August, Canopy Growth (TSX: WEED) (NASDAQ: CGC) will release its first fiscal quarter. According to Sentieo, the company is expected to see revenue increase slightly to C $ 150 million, which would represent a 36% growth from a year ago. Adjusted EBITDA loss is expected to improve, but is still expected to be C $ 65 million.

For those looking for more information on companies reporting in August, we are posting full earnings snapshots for 420 Investor subscribers, including the Focus List members mentioned here: Canopy Growth, Columbia Care, Cresco Labs , Curaleaf, Green Thumb Industries, GrowGeneration, Harvest Health & Loisirs, Scotts Miracle-Gro and Trulieve.

Visit the Public Cannabis Company Revenue Tracker to track and explore the full list of eligible businesses. We recently created a way for our readers to access our library of Revenue Tracker articles. For our readers who want to stay on top of scheduled income calls in the industry, we have created and continuously updated the Cannabis Investor Income Conference Call Schedule.

Get a head start by signing up for 420 Investor, the largest and most comprehensive premium subscription service for cannabis traders and investors since 2013.

Alan Brochstein, CFA

Based in Houston, Alan draws on his experience as the founder of the 420 Investor online community, the first and still the largest publicly traded equity-focused due diligence platform 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. Prior to focusing on the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as a freelance research analyst after more than two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 on Seeking Alpha, where he has 70,000 subscribers, Alan is a frequent speaker at industry conferences and a frequent source for the media including the NY Times, Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alain: Twitter | Facebook | LinkedIn | E-mail

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Barbara M. Stokes