Cannabis NB posts record sales, profits as Higgs government ponders agency's fate
‘We were asked to fix Cannabis New Brunswick and we did,’ says CEO Patrick Parent
With the prospect of being turned over to the private sector at any moment hanging over its head, Cannabis NB rushed its second-quarter financial results out in record time Thursday to report significant sales and profit increases through the summer.
"A year ago we were asked to fix Cannabis New Brunswick and we did," president Patrick Parent said at a rare quarterly report news conference. "Cannabis New Brunswick has the most profit per capita in Canada, something we should all be proud of."
According to unaudited results reported by the agency, sales over 13 weeks between June 29 and Sept. 27 rose to $20.1 million. That returned a $3.3-million profit.
Both these figures are records and a stunning improvement over a year earlier.
During the same quarter last summer, sales at Cannabis NB were just over half as much, or $10.7 million, and the Crown corporation lost $1.5 million.
At the time, results were such a disappointment that Cannabis NB did not report them until Oct. 29, the full 30 days allowed by New Brunswick legislation after the quarter end. Thursday's results come less than four days after the most recent quarter, which ended on Sunday.
CEO wants to keep it a Crown corporation
Parent did not directly say he was personally delivering the record results in record time to make a point with the Blaine Higgs government about its pending decision whether to unload the agency to the private sector.
But he made it clear he wants Cannabis NB to remain a Crown corporation.
"We have a background plan we've been working on in the event where we are the chosen retailer," said Parent.
"We'll wait for the result. We all have to understand that everything we do — our profits go back to the community. It goes back to pay for services, schools, hospitals, repaying the debt, so we take that duty very seriously."
Parent said he sees more opportunity to crowd out illegal sellers to further improve results. He said Cannabis NB, once known for high prices and poor selection, has shed that reputation and was the first legal retailer to offer cannabis for $100 per ounce ($3.53 per gram) after cutting corporate expenses and renegotiating prices with suppliers.
"We believe there is still a lot of potential within the market from a market share standpoint. We believe there is still a lot of room to grow," he said.
Last November, following Cannabis NB's dismal performance in the first half of 2019, the Higgs government said it could not tolerate the losses and launched a country-wide search for a private-sector operator to take the agency over.
"This is part of our efforts to energize the private sector, get our financial house in order and maximize the benefits for taxpayers and the government," Finance Minister Ernie Steeves said at the time.
Bids from several private parties have since been evaluated by the province, and during the recent provincial election Higgs said a privatization decision would be made by the new government.
In an email, Finance Department spokesperson Jennifer Vienneau said that decision is coming soon, and Cannabis NB's recent success will be taken into consideration.
"We will continue to objectively compare Cannabis NB's latest projected figures with the offers we have on the table from the private sector," wrote Vienneau.
"We want to ensure New Brunswickers have a cannabis retail model that focuses on public health, education and safety and offers the best value for the New Brunswick taxpayers."