‘Tis the season of quarterly financial results, and High Tide Inc. had its share of successes to report. Despite national lock-downs and in-store shopping restrictions in its largest markets, High Tide reported a 99% revenue increase, generating $40.9 million between February and April of this year, compared to $20.6 million during the same time last year.
Mergers and Acquisitions
The merger of High Tide and META Growth Corp. in November of last year was big news, being one of the first major mergers on the retailer side of the industry. It created Canada’s largest cannabis retailer at the time, with 63 stores and projected annual revenue of $133 million.
This quarter represents the first full quarter of the partnership, now fully settled and sorted, and along with the acquisition of e-commerce brand Smoke Cartel, the company attributes part of its revenue increase to these brands joining the flock. Smoke Cartel, along with GrassCity.com, FABCBD.com, and CBDcity.com, represents the company’s e-commerce banners.
By the numbers, High Tide reported that year-over-year, its gross profit has increased to $15 million, compared to $7.8 million the year before, representing a 93% increase and driving up the company’s adjusted EBITDA to $4.7 million, having been just $1.8 million last year.
Of the $40.9 million in revenue earned this quarter, $35 million was earned in Canada, with $5.7 million coming from business ventures south of the border. The lion’s share of High Tide’s revenue came from the retail side, which brought in $38.4 million.
During this time, the company also managed to open 13 new Canna Cabana and META stores, including five in Ontario and eight in Alberta, bringing its store count up to 87 across Ontario, Manitoba, Saskatchewan, and Alberta under retail banners Canna Cabana, KushBar, Meta Cannabis Co., Meta Cannabis Supply Co., and NewLeaf Cannabis.
It remains focused on expanding in Ontario, hoping to bring its retail presence in the province from 18 stores to 30 by the end of September. According to the press release, High Tide also hopes to expand into British Columbia soon.
“I am extremely proud of our results this quarter, especially given the macro backdrop we faced. In Ontario, the largest cannabis market in Canada, due to pandemic related restrictions, our stores were closed for in-person shopping throughout most of the second quarter with only click-and-collect and delivery permitted by regulations,” said Raj Grover, High Tide’s President and CEO in a press release. “Even during this difficult market environment, we continued to advance our bricks and mortar and online business. Ontario has now moved to allow in-store shopping with capacity limits which should bolster sales, coupled with our recent acquisitions of FABCBD and Daily High Club, we expect to deliver continued revenue and EBITDA growth in the third quarter.”