Market share trends in Florida (TCNNF, CURLF, GTBIF, CCHWF, LHSIF)
The Florida Office of Medical Marijuana Use (OMMU) releases updated cannabis data every Friday.
For the week ending November 19th, the number of qualified patients in Florida’s medical marijuana program grew 0.5% WoW or 48.3% YTD to 443,534 qualified patients with active ID cards. The qualified patient adds have slowed, with WoW growth averaging at 0.6% over the past month compared to September’s WoW growth averaging at 1.0%. THC in mgs sold grew 7.6% WoW to 137.2 million mgs, CBD in mgs sold grew 0.2% WoW to 3.4 million mgs, and flower in oz. sold fell 4.9% WoW to 48,860 oz. sold.
On a 12WMA, Trulieve’s THC in mgs sold per dispensing location continues to maintain a strong lead, nearly double that of the next operator, AltMed Florida. At the same time, that figure has been slightly trending downwards since its summer peak, Trulieve’s flower in oz. sold per dispensing location increased 71bps WoW. While still far behind Trulieve, GrowHealthy has been showing sustained improvement with flower. On a 4WMA, Trulieve maintains a disproportionate market share, with 51.0% share of mgs THC sold, 40.5% of mgs CBD sold, and 55.3% of oz. in flower sold, at just 22.7% share of approved dispensing locations.
Florida’s medical marijuana marketplace is still in early stages with strong potential – the state’s medical marijuana program still has a runway for population penetration, edibles were just introduced to the market in August, and there’s a broad range of qualifying medical conditions, notably ‘severe and chronic pain.’ The rising tide that is patient volume growth lifts all ships.
Another record month for adult-use sales in Canada, but growth slowing (APHA, CGC, CRON)
Canadian adult-use retail sales grew to a record C$244.9 million in September; however, sequential growth has slowed. September sales represent an increase of 1.8% MoM and 108.5% YoY. September’s sales suggest annualized revenues of C$3.1 billion.
Ontario was the primary driver of growth, with a 30.4% share of September sales and growing 5.3% MoM. Alberta and Quebec's provinces had subdued growth; Alberta, with a 20.7% share of sales, grew 1.0% MoM, and Quebec, with a 17.6% share of sales, grew 0.9% MoM. Five provinces making up 8.1% of September sales, Newfoundland & Labrador, New Brunswick, Manitoba, Yukon, and Northwest Territories, posted negative MoM growth.
The Canadian marijuana market has shown robust organic growth throughout the pandemic. However, September’s sales suggest that adult-use sales could be heading towards a plateau in the final months of 2020. For Canadian operators, the headwinds are numerous: there is an increasingly crowded competitive landscape with new entrants, an illicit market with light regulation, and declining wholesale prices while providing a temporary benefit to margins makes for an unsustainable environment for positive margin growth. Canadian LPs are still grappling with the country’s oversupply issue, which has led to inventory write-downs and impairment charges.
Ontario again green lights curbside pickup and delivery for cannabis (HITIF, CGC, FFLWF)
In a boon for Canada’s largest market, Ontario will allow cannabis retailers to offer curbside pickup and delivery as parts of the province head into lockdown amid rising cases of COVID-19. Toronto, Ontario, the country’s largest city, was put under a lockdown order lasting 28 days this past Friday. The province permitted delivery services in April but disallowed it in late July to the dismay of cannabis retailers. There are over 225 licensed brick-and-mortar stores in Ontario, with more than 700 applications under review.
Beneficiaries of this regulatory adjustment include High Tide and Fire and Flower Holdings.
High Tide Inc. (HITIF), a leading Canadian cannabis retailer, recently closed its merger with Meta Growth Corp., creating the country’s leading cannabis retailer with 65 operating retail locations. By the end of the month, HITIF expects to have a portfolio of 12 operating locations in Ontario.
Fire & Flower Holdings Corp (FFLWF) announced a few weeks ago that it had entered into a definitive share purchase agreement to acquire Friendly Stranger Holdings Corp for approximately C$30 million. Upon acquisition close, Fire & Flower is expected to own and operate an additional 11 licensed cannabis retail stores across the province of Ontario, with four more cannabis stores in the queue to be licensed and operational by the end of Q4 2020. Upon closing, Fire & Flower is expected to have 66 stores, including 18 in Ontario and an additional 9 stores in the queue for licensing, giving the company the largest footprint in Ontario and Canada.
