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High Tide reports second consecutive quarter of net income

September 16, 2024 | Sarah Clark

High Tide reported $825,000 in net income from $35.5 million in gross profit and $131.7 million in revenue in the three months ended July 31, 2024.

The company behind retail cannabis chain Canna Cabana says its 6% year-over-year growth in revenue was driven by an increase in the number of stores, from 154 the same quarter last year to 180 as of the current quarter (Q3 2024), as well as increases in same-store sales.

Net income was up from a $3.6 million loss in Q3 2023. This is High Tide’s second consecutive quarter of positive net income.

The Alberta-based company reported $115.7 million in revenue from cannabis and CBD products and another $7 million in consumption accessories. High Tide also brought in just over $9 million in revenue from its data analytics program (Cabanalytics Business Data and Insights Platform), as well as advertising and other revenue.

High Tide’s brick-and-mortar retail stores brought in 94% of revenue from sales.

While the majority of High Tide’s sales are in the Canadian market, it also operates its e-commerce platforms in the US such as Smoke Cartel, Grasscity, Daily High Club, DankStop, NuLeaf Naturals and FABCBD, as well as USA sales on its international e-commerce platforms. In addition, High Tide operates a warehouse that primarily services its e-commerce operations.

Some 94% of High Tide’s revenue came from the Canadian market, while about 6% came from these US holdings. The company continues to see a decrease in revenue from USA and international operations, down 33% in the most recent quarter. High Tide blames this on the weakening CBD sector on the international market and a decrease in consumer spending on accessories “due to economic pressures.”

“Over the last year, the High Tide team has presented investors with compelling proof points as to how we’re different than other retailers, and our third quarter results offer even further evidence of this,” said Raj Grover, Founder and Chief Executive Officer of High Tide.

“Our numbers continue to drive home the fact that we are a well-managed, innovative company that has grown responsibly while continuing to build value for shareholders. Numbers don’t lie and this quarter’s record revenue, positive net income and free cash flow, for the fifth consecutive quarter, sit in stark contrast to some of our big-name competitors recently filing for bankruptcy protection or shutting down completely. Unlike these competitors, we are generating strong free cash flow from our operations, which has been powering our organic growth trajectory in recent months. This has allowed us to grow our cash on hand balance to $35.3 million, the highest ever.”

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