Sundial, which trades under the ticker symbol “SNDL” on the NASDAQ, has revealed that its adult-use cannabis revenue has fallen 38% in the quarter.
The company’s revenue from recreational cannabis in Canada plunged by more than one-third in its most recent quarter compared to the previous period.
Sundial’s revenue hit is correlated to the company taking a hit from compression and provincial wholesalers culling slow-moving products.
The Canadian marijuana producer reported net revenue of 9.9 million Canadian dollars ($8 million) for its first quarter through March 31. This was well below analysts’ expectations of approximately CA$12 million.
Net loss doubled from the previous quarter to CA$134.4 million, mainly as a result of a CA$130 million non-cash charge.
From January through March, the company said it had harvested 5,387 kilograms of dry cannabis, or about half the amount harvested one year ago.
Sundial sold 3,989 kilogram equivalents in the quarter, less than the 4,437 kilogram equivalents it sold in the same period last year.
Areas were the company saw significant revenue declines were:
Dried flower: CA$9.7 million (down 19% from previous quarter).
Vapes: CA$1.4 million (down 67%).
Cannabis oil: CA$181,000 (down 43%)
Edibles and concentrates: CA$438,000 (up 43%)
Fortunately the company earned revenue CA$2.7 million from wholesale sales to other licensed producers. This was an increase of 11% over the previous quarter.
The company has also recently said that it plans to acquire Inner Spirit Holdings, a major Canadian cannabis retailer and franchisor of Spiritleaf stores. The transaction is expected to close this summer.