Planet 13 Holdings Inc (CSE:PLTH, OTCQX:PLNHF) said that it is well positioned to weather the current downturn in the cannabis market and be one of the industry winners in the long term.
In a message to investors, co-CEOs Bob Groesbeck and Larry Scheffler said the company had positive operating cash flow at the end of September 2022, with $50 million in cash, zero debt and that it was up to date on all tax payments.
"2022 was a difficult year for cannabis investors and as CEOs and holders of over 78 million shares of Planet 13 combined, we certainly empathize with shareholders,” Groesbeck and Scheffler said. “2022 was the worst year for the markets since 2008 and our industry was not spared.”
The co-CEOs noted that prices were down across the board for cannabis stocks in 2022, blaming the failure of reform at the federal level as the biggest driver.
"At Planet 13 we can only control what we can control and so that is what we focus on,” they said. “We've maintained 8-10% market share in Nevada while cutting costs to maintain margins.”
Groesbeck and Scheffler noted that Planet 13 is growing revenue in California and has made progress on its growth initiatives in Florida and Illinois, setting the stage for the company to have operations in four states by the end of 2023.
“We continue to have one of the strongest balance sheets and cleanest capital structures in the cannabis industry,” they added. “There is a saying, ‘Revenue is Vanity, Profit is Sanity and Cash is King.' We have always managed our business aligned with this even when everyone else was focused on rapid growth.”
Planet 13 has award-winning cultivation, production and dispensary operations in Las Vegas and in Orange County, California.
The company also holds a medical marijuana treatment center license in Florida and a 49% interest in Planet 13 Illinois, which holds a provisional Social-Equity Justice Involved dispensing license in the Chicago region of Illinois.
Planet 13's mission is to build a recognizable global brand known for world-class dispensary operations and a creator of innovative cannabis products.
Contact the author at stephen.gunnion@proactiveinvestors.com