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Sunday, Aug 14, 2022
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.

Business

Cannabis NL sales fall 12% to $14.2M

The Crown corporation has made recent changes to improve distribution

Cannabis NL sales fall 12% to $14.2M
Spiritleaf on Topsail Road in St. John's Newfoundland. Image via Spiritleaf

While adjustments to Newfoundland and Labrador’s cannabis distribution system seem to be off to a good start, legal weed sales have slowed at the same time.

On Thursday, the Newfoundland and Labrador Liquor Corporation released its earnings report for the three months ended Jan. 1.

The NLC reports third-quarter retail sales down nearly 12 per cent to $14.2 million, from $16.1 million last quarter.

Nearly all transactions go through retail stores, accounting for $14.1 million of cannabis sold. The remaining sales were online.

Beverage alcohol sales headed the opposite direction, going up 8 per cent to $85.3 million from $78.7 million in the second quarter.

NLC Q3 chart of sales comparing year to year changes

Chart via NLC

In October, the NLC introduced its new distribution model for cannabis sales, which provides direct shipping from its distribution centre in St. John’s.

The NLC made the change to improve fulfillment times, boost product selection, cut delivery times and lower shipping fees for online orders.

“While only three months into this new initiative, retail customers and consumers report positive feedback on service levels, particularly with respect to decreased shipping times,” the NLC adds.

Read more: Cannabis NL reports steady profits, improved distribution

Read more: Sales climb 8% for Cannabis NL

The Newfoundland and Labrador network lists more than 800 products from 27 suppliers, and a listing call is out for new products and suppliers.

Six more retail stores opened during the third quarter, bringing the total to 38, with more expected in the coming months, the NLC says.

“With the continuing challenges and uncertainty associated with the pandemic, particularly with the move to Alert Level 4 in mid-December, our team has maintained its focus on our customers and giving them the very best experience we can,” president and CEO Bruce Keating says.

“In parallel, we continue to make important improvements through our store renovation program, in cannabis and in other parts of the business to deliver the most value possible to the people of the province.”

A total of $55 million was sent as a dividend to the provincial government. The NLC says it returns all of its profits to help fund public services.

The dividend for the year-to-date has reached $171.8 million, $15.3 million more than the same period last year.

The NLC conducted 1,035 inspections on liquor and cannabis retailers in Q3, a 5-per-cent dip since last quarter and a 19-per-cent drop in the number of inspections compared to this period last year.

The Crown corporation attributes the decrease to the “elevated number of inspections required during the height of the pandemic in the fall of 2020.”

 

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