💸 The Tape

Auxly Cannabis Group Inc. (TSX: XLY) (OTCQB: CBWTF) delivered a solid 2025 performance that stands out in a Canadian cannabis sector still grappling with pricing pressure, oversupply in some categories, and margin compression. The company reported record net revenue of $151.5 million for the year, a 24% increase from 2024, while achieving its highest adjusted EBITDA to date at $43.8 million (29% margin). These results reflect disciplined execution, successful brand positioning, and a strategic shift toward higher-margin finished goods.

Revenue Growth and Segment Performance

Full-year revenue reached $151.5 million, up 24% year-over-year. The fourth quarter contributed $40.1 million, representing 16% growth compared to Q4 2024. This marks the second consecutive year of revenue expansion for Auxly, a notable achievement given the challenging industry backdrop of declining wholesale prices and intense competition in several provinces.

The growth was driven primarily by the company’s cannabis operations, which posted an 11.4% increase in combined cannabis revenue for the year. Auxly’s ability to maintain and grow revenue while many peers faced flat or declining sales highlights the effectiveness of its branded product strategy and retail execution. Back Forty solidified its position as Canada’s #1 cannabis brand throughout 2025, providing a strong anchor for the portfolio.

Margin Expansion and Profitability

One of the most encouraging aspects of the 2025 results was the improvement in gross margin on finished cannabis inventory sold, which rose to 54% from 46% in 2024. In the fourth quarter, this metric reached 56%. These gains reflect better product mix management, cost efficiencies in cultivation and manufacturing, and a deliberate focus on higher-margin finished goods rather than low-margin wholesale biomass.

Adjusted EBITDA increased 64% to $43.8 million for the year, with a 29% margin compared to 22% in 2024. The fourth quarter delivered $12.5 million in adjusted EBITDA (31% margin), demonstrating consistent profitability at the operating level. The company also achieved net income of $41.9 million for the year ($0.03 per share), a significant turnaround from prior periods.

Cash flow generation was equally impressive. Cash flow from operations before working capital changes reached $38.6 million for the year (88% conversion from adjusted EBITDA). The fourth quarter alone contributed $11.9 million (95% conversion). At year-end, Auxly held $32.3 million in cash with a conservative total debt to adjusted EBITDA ratio of 1.1x, providing a solid liquidity position and financial flexibility.

Operational and Brand Highlights

Auxly maintained its ranking as the #3 Canadian licensed producer by market share while continuing to invest in brand innovation. The launch of the new premium-tier brand South Point in Alberta and Ontario expanded the portfolio into higher-margin segments. The company also benefited from strong performance in its core Back Forty and other established lines.

The results reflect successful operational improvements across the supply chain. By focusing on quality, consistency, and targeted product development, Auxly has been able to command better pricing and margins despite industry-wide deflationary pressures in wholesale flower.

Strategic Positioning and Outlook

Auxly’s 2025 performance demonstrates a maturing business model that balances revenue growth with margin discipline and cash generation. The company has successfully navigated a difficult industry environment by emphasizing branded finished goods, optimizing costs, and maintaining a lean capital structure.

With $32.3 million in cash and a low debt burden, Auxly enters 2026 with a strong foundation. Management’s focus on further margin expansion, brand innovation, and selective growth opportunities positions the company to build on its 2025 momentum. The cannabis sector continues to consolidate, and operators with proven brands, efficient operations, and positive cash flow are best placed to emerge stronger.

While challenges such as ongoing price competition and regulatory uncertainty remain, Auxly’s track record of improving profitability metrics and generating cash suggests it is well-equipped to handle near-term pressures while pursuing long-term value creation.

For investors, 2025 marked a year of tangible progress. Record revenue, expanding margins, positive net income, and robust cash conversion all point to a business that is stabilizing and scaling in the right direction. As the Canadian cannabis market continues to mature, Auxly’s brand strength and operational discipline provide a compelling foundation for sustained growth and improved shareholder returns in the years ahead.

📈 Dog Walkers

$TOKE ( ▼ 1.79% ) Goes Up In Smoke

Cambria Investment Management, the California-based provider of exchange-traded funds, has announced the scheduled liquidation of its Cambria Cannabis ETF (NYSE Arca: TOKE), citing an ongoing strategic review of its product lineup to better align with evolving client needs.

The decision, approved by the Board of Trustees on March 24, 2026, follows the recommendation of Cambria Investment Management, L.P., the fund’s advisor. The TOKE ETF, which focuses on cannabis-related companies, currently represents less than 1% of Cambria’s total assets under management.

Shareholders may continue to buy or sell shares on the exchange until the close of trading on Friday, April 17, 2026. Customary brokerage commissions will apply. The fund will cease trading at the end of that day and is expected to fully liquidate on or around Friday, April 24, 2026.

Investors still holding shares on the liquidation date will receive a cash distribution equal to the net asset value (NAV) of their shares at that time. Cambria will cover all liquidation-related fees and expenses, except for standard brokerage costs and related charges incurred by shareholders.

The liquidation reflects a broader industry trend of consolidation and rationalization among thematic ETFs, particularly in volatile sectors like cannabis. While cannabis legalization continues to expand across U.S. states and internationally, many cannabis-focused funds have struggled with low assets, high volatility, and limited investor interest compared to broader thematic strategies.

For Cambria, the move allows the firm to concentrate resources on core offerings while streamlining its overall product suite. Shareholders in TOKE are encouraged to consult their financial advisors regarding the implications of the liquidation on their portfolios and any potential tax considerations.

The full details of the liquidation process will be communicated directly to shareholders and are available through standard regulatory filings.

$CURLF ( ▼ 6.11% ) Expands In Florida

Curaleaf Holdings, Inc. (TSX: CURA) (OTCQX: CURLF) has strengthened its dominant position in Florida’s medical cannabis market with the opening of a new dispensary in Cape Coral.

The new location at 345 SW 10th Place, situated in the Shops at Del Mar shopping plaza, brings Curaleaf’s Florida footprint to 72 stores and its nationwide total to 163 dispensaries. This marks the company’s third location in Lee County, joining existing stores in Fort Myers and Bonita Springs.

The Cape Coral dispensary offers Curaleaf’s full range of high-quality products and brands, including Florida-exclusive Reef flower, Select ACE vape cartridges, Anthem pre-rolls, and Select Briq vapes. Knowledgeable staff will be on hand to guide patients through their shopping experience in a convenient, community-oriented setting surrounded by retail, dining, and everyday services.

Boris Jordan, Chairman and CEO of Curaleaf, emphasized the strategic importance of the expansion: “With 72 stores statewide, our growing presence in Florida reflects our commitment to the state and its medical patients. Our longstanding roots, market expertise, and quality products allow us to expand thoughtfully into communities needing greater access to medical cannabis, while delivering an exceptional retail experience to our patients.”

To mark the occasion, Curaleaf will host an exclusive “Meet the Manager” event on Thursday, March 26 from 12:00 p.m. to 4:00 p.m. for industry partners, local business owners, and community leaders. The gathering will provide an opportunity to connect with the Curaleaf team and learn more about the company’s patient-focused approach.

The opening continues Curaleaf’s steady retail expansion in Florida, one of its most important markets. With additional openings planned across the state in the near term, the company is reinforcing its position as a leading provider of medical cannabis products and services to Florida patients.

In a competitive and maturing market, Curaleaf’s focus on quality, accessibility, and community integration remains a key differentiator as it works to meet growing patient demand across the Sunshine State.

🗞️ The News

📺 YouTube

High Tide Reports Record Earnings + Missouri Hemp Crackdown | TTB Presented by Flowhub

What we will cover:

✅ In this episode of Trade To Black, presented by Flowhub, hosts Shadd Dales and Anthony Varrell cover three key stories across earnings, hemp policy, and medical cannabis reform.

We start with Raj Grover, CEO of High Tide (NASDAQ:HITI), following a strong quarterly report. The company posted record revenue of $178.3 million, improved margins, and continued free cash flow generation. We discuss what’s driving performance, including retail market share gains, Cabana Club growth to over 2.5 million members, and progress internationally in Germany.

Then Adam Stettner returns in segment #2 to break down what’s actually happening in Missouri. Despite headlines, there is no official hemp ban. A House bill passed but stalled in the Senate, while regulators continue enforcement actions targeting intoxicating hemp products. The conversation focuses on what operators need to understand right now.