Canadian cannabis company High Tide Inc. (Nasdaq: HITI) (TXSV: HITI) posted net income of C$171,000 for the three months that ended April 30, the company’s second fiscal quarter of 2024, a long-awaited turnaround after breaking even last quarter and losing C$1.6 million a year ago.
The profit level for the quarter would’ve been even higher, but High Tide also took a C$7.5 million non-cash depreciation hit.
High Tide reported revenue of C$124.2 million, a 5% year-over-year increase from C$118.1 million, and free cash flow of C$9.3 million for the quarter, bringing the company’s total free cash flow for the past 12 months to C$22.7 million.
High Tide’s market share of the Canadian cannabis trade also grew year-over-year to 10.9% from 9.9%. The company previously stated its long-term goal is to reach 15% market share, with 300 operational dispensaries. So far it has 172 stores across Alberta, British Columbia, Manitoba, Ontario, and Saskatchewan.
High Tide reported a solid 4% uptick in year-over-year same-store sales, the company reported, and said its shops “significantly outperformed” industrywide sales in the five Canadian provinces where it has retail dispensaries.
The company also opened five new Canna Cabana marijuana shops in Ontario during the quarter, acquired the cannabis brand Queen of Bud, and closed on the remaining assets of NuLeaf that it hadn’t already bought. Following the end of the quarter, High Tide opened another four shops in Ontario.
“In an environment where many cannabis companies, including some of our retail competitors, have been forced to seek bankruptcy protection, our team has been able to deliver positive net income in (our second quarter), while also generating record-breaking free cash flow,” CEO Raj Grover said in a press release.
“We remain the highest revenue-generating cannabis company reporting in Canadian dollars with adjusted EBITDA up 52%, bricks-and-mortar revenue up 11%, and consolidated revenue up 5% year-over-year, despite industry sales being down 4% during the same period,” Grover said.
Grover added that High Tide is on track to make its goal of opening 20-30 new dispensaries this calendar year, with 10 already opened thus far in 2024. The company is “accelerating strategic and accretive M&A, focusing on opportunities of various sizes to further add meaningful size and scale to our store network,” Grover said.
“Our ambition to turn High Tide into a global cannabis powerhouse is within reach,” Grover said.
During the quarter, High Tide also increased its Canna Cabana Club loyalty program to 1.43 million members, an 8% increase sequentially and a whopping 38% increase year-over-year. It reported membership in its paid ELITE loyalty program topped 44,000 members, a 226% increase year-over-year.
As of April 30, High Tide had C$234.4 million in total assets, including C$34.5 million in cash, against C$92.2 million in total liabilities.