Cannabis NB still losing money, despite Q2 sales growth
Cannabis NB has tallied losses north of $15 million in its first 50 weeks
Legal cannabis sales in New Brunswick showed some improvement over the summer, but Cannabis NB continues to lose money.
"The loss for this quarter is $1.5 million," Cannabis NB spokesperson Marie-Andrée Bolduc said in an email to CBC News.
Cannabis NB reported late Tuesday that sales in its second quarter, which covered 13 weeks ending on Sept. 29, were $10.7 million. That's a 17.6 per cent increase over first-quarter sales.
Those results appear positive, but the agency wouldn't say whether sales figures were better or worse than budgeted, although it was clear the increase was not enough to stem ongoing financial losses.
"It can take time to become profitable," said Bolduc. "We are actively working toward profitability and Phase 2 products will help accelerate that process."
Another mystery is how much of the summer sales increase was seasonal.
Cannabis NB's parent, NB Liquor, routinely posts its strongest sales of the year during the summer and some data from the U.S. suggest cannabis consumption may follow similar patterns.
For example, NB Liquor sales in the second quarter were $126 million, a decline from last summer, but still 14.6 per cent more than its first quarter.
Both agencies use the same reporting periods.
That makes it difficult to know if Cannabis NB's second-quarter sales bump signifies growing acceptance by consumers or is due in part to summer usage.
Losses more than $16M
Bolduc's statement did say supplies of cannabis in agency stores have improved, selection is better and prices on some products are now lower than they have been.
The provincial Crown corporation launched last October with the legalization of cannabis in Canada but has been in financial difficulty from the beginning.
Sales have been less than half what was originally planned, forcing layoffs and causing significant financial problems.
The agency was budgeted to break even but lost $12.5 million over its first six months and a further $2.2 million during the first quarter of this year.
The latest results increase losses to $16.2 million over its first 50 weeks.
Initially, Cannabis NB blamed a lack of supply for sales problems but, more recently, has pointed to provincial dispensaries it says are operating illegally and poaching customers.
- An earlier version of this story said that since opening, cumulative losses at Cannabis NB were $15.4 million. In fact, that number is $16.2 million.Oct 31, 2019 6:56 AM AT