💸 The Tape

Decibel Cannabis: Striking the Right Chord with Financial Gains

Decibel Cannabis Company Inc. (TSXV: DB) (OTCQB: DBCCF) just serenaded its investors with some promising unaudited interim financial results for the three and nine months ending September 30, 2024. The company is singing a tune of growth and strategic maneuvers that even Beethoven would envy.

CEO Benjamin Sze hit all the right notes, boasting about slashing current liabilities by a cool $5 million this quarter. With disciplined financial management becoming their forte, Decibel is tuning up for a stronger balance sheet. This quarter marks their swan song for focusing predominantly on Canadian domestic recreational sales. Meanwhile, the integration of AgMedica into their portfolio has the potential to orchestrate a crescendo of international demand for Decibel flower.

Third Quarter Highlights

In the third quarter of 2024, Decibel posted net revenue of $24.1 million, marking a 9% sequential increase over Q2 2024. While this is a 12% dip year-over-year, it needs to be some to keep an eye on for next quarter. The net revenue drop is largely due to the fierce competition in the infused pre-roll segment, vape consumers opting for large format 510 cartridges and disposables, and a temporary halt of exports to Israel as they tuned up with a new distribution partner.

But hold your applause—there’s more. Gross margin before fair value adjustments hit a harmonious 53%, up from 44% in Q3 2023. Adjusted EBITDA rose to $5.1 million, a 31% sequential increase, though it reflects a 21% decline year-over-year due to lower Canadian recreational and international sales.

Rounding out the performance, Decibel's positive free cash flow was $1.8 million, up by 75% from Q3 2023. And let's not forget the star performer: Adjusted Net Income, which soared to $2.1 million, a whopping 294% increase year-over-year. With an Adjusted EPS of $0.01, the year-over-year increase was a harmonious $0.01.

Decibel came onto the scene with a boom and is now feeling the crunch of competition entering the infused pre-roll category across Canada. We saw Canopy Growth announce this week that they are bringing award winning infused pre-rolls from California north of the border so expect competition to continue to increase and force a company like Decibel to get disciplined and innovate. Or die.

📈 Dog Walkers

SLANG Continues Winding Down Operations

SLANG Worldwide Inc. (CSE: SLNG) (OTCQB: SLGWF) has hit a bump in the road, with some of its Colorado subsidiaries placed into receivership by Order of Justice Goldberg. Highline Financial Group, LLC is now the proud new receiver of these assets. SLANG also snagged a conditional extension on its waiver and support agreement with its secured lenders. This means the lenders are holding off on any drastic measures under the credit agreement until January 31, 2025, or until they decide otherwise. It's a tightrope walk for SLANG, balancing financial woes with strategic maneuvers. Stay tuned, because this cannabis company’s journey is far from over.

SNDL Bolsters Leadership Team

SNDL Inc. (Nasdaq: SNDL) just jazzed up its leadership team, appointing Phil McBride as Chief Information Officer and Navroop Sandhawalia as President of the Liquor Division. CEO Zach George is pouring out praise for these additions, noting how Phil's tech wizardry and Nav's financial finesse will turbocharge SNDL's growth strategy. McBride, with over 25 years of experience, comes from heavyweights like Proctor & Gamble and Molson Coors, bringing digital transformation chops and AI integration skills. Meanwhile, Sandhawalia, previously Interim President, Liquor Division, has been a dynamo in driving operational efficiency. With this power duo on board, SNDL is set to toast to a future of innovation and success. Cheers to progress!

GTI Keeps It 100

RISE Dispensaries, a fast-growing cannabis retail chain under Green Thumb Industries Inc. (CSE: GTII, OTCQX: GTBIF), is on a roll, hitting its 100th and 101st store openings. The 100th store, RISE Dispensary Carson City on US HWY 50, opens on November 23, 2024, in Carson City, NV. Not stopping there, the 101st store, RISE Dispensary Brooklyn Park, opens the same day in Brooklyn Park, MN. These new locations highlight Green Thumb's expansion, marking significant milestones in Nevada and Minnesota's cannabis markets.

Ben Kovler, Green Thumb's CEO, expressed pride in these achievements, attributing success to the dedicated team and supportive communities. With special grand opening events and charitable contributions, RISE Dispensaries is all set to keep the momentum going and growing. Cheers to that!

🗞️ The News

Decibel Announces Third Quarter Results

SLANG Worldwide Announces Extension of Waiver and Support Agreement and Appointment of Receiver in Colorado in accordance with its Previously Announced Lender Approved Wind-Down Plan

SNDL Appoints New Chief Information Officer and New President, Liquor Division

Here’s how marijuana retailers can boost their e-commerce sales

📺 YouTube

CEO Panel Analyzes Canadian Cannabis Future | Trade to Black

What we covered:

✅ On our latest Trade To Black Podcast, we talk Canada featuring a panel of Canadian executives sharing their insights on the future of the Canadian cannabis landscape.

Emma Andrews, CEO of Nextleaf Solutions (CSE: OILS), Michael Perron, CEO of MTL Cannabis (CSE: MTLC), and Omar Khan, Chief Communications Officer of High Tide (NASDAQ: HITI), will discuss the biggest opportunities for Canadian companies heading into 2025 and why more companies in Canada are now collaborating with one another.

We’ll also hear their perspectives on growing international markets, the current excise tax challenges for cannabis companies in Canada, and how the cannabis industry could evolve in a post-reform U.S. market.