Planet 13 Holdings Inc (CSE:PLTH, OTCQX:PLNHF) has released its financial results for the first quarter ended March 31, 2023, highlighting increased retail revenue from its Orange County Superstore aided by stabilizing cannabis prices.
In the results statement, Larry Scheffler, co-CEO of Planet 13, expressed satisfaction with the results, commenting: "In Q1 we saw a stabilization in cannabis prices resulting in an improvement in our retail revenue from the SuperStore. In Nevada, we maintained our share of sales above 8%, consistent with our long-term goals."
Bob Groesbeck, fellow co-CEO, outlined the company's strategic goals for 2023, which include strengthening its core business, expanding scale, and improving cash flow and capital preservation. Groesbeck emphasized the commitment to reducing costs, pursuing mergers and acquisitions, and leveraging their strong core business to generate free cash flow.
In terms of financial highlights for 1Q 2023, Planet 13 reported revenue of $24.9 million, a 3.0% decrease compared to the same period last year. The decline in revenue was primarily attributed to a significant drop in the average price of cannabis in Nevada. However, there was an offsetting increase in revenue from the Orange County Superstore and additional wholesale revenue in California and Nevada.
The company's gross profit for the quarter was $10.9 million or 43.7%, a decline from $12.9 million or 50.2% in the previous year. This decrease was driven by lower cannabis prices in Nevada and a higher proportion of lower-margin wholesale revenue.
Total expenses were reduced to $15.3 million, reflecting a decrease of 7.8% due to effective cost control and lower share-based compensation. However, Planet 13 reported a net loss of $6.3 million, compared to a net loss of $2.1 million in the previous year, primarily due to lower gross profit and one-time costs associated with potential mergers and acquisitions.
The company's cash position stood at $42.7 million, compared to $52.4 million at the end of 2022.
In addition to the financial results, Planet 13 highlighted several significant developments during its first quarter, including the announcement of the location for its Port Orange dispensary in Florida, the purchase of land and a building for its planned Illinois dispensary, and the exercise of an option to acquire the remaining 51% interest in Planet 13 Illinois.
Contact the author at jon.hopkins@proactiveinvestors.com