🏪 Ohio Adult-Use Sales Launches
🏪 Ohio Adult-Use Sales Launches
Growlink $2M Seed. TerrAscend closes 12.75% $140M Loan. Jushi refinances ~$53M Loan at 12.25%. Earnings: Trulieve, GTI, AWH, IIP, Turning Point Brands.
🌿 Industry
Ohio’s Adult-Use Marijuana Dispensaries Launches Today, Tuesday, August 6th.
98 Ohio marijuana dispensaries began recreational sales. — Cincinati.com
On Monday, Ohio’s Division of Cannabis Control announced 98 dispensaries across the state that received a dual-use Certificate of Operation (COO)
DCC’s statement comes after companies including Curaleaf, Cresco Labs, GTI, Trulieve, Ayr Wellness, The Cannabist Company disclosed they were told by regulators they will imminently receive their COO on Friday
Ohio is the seventh-most-populous state in the country with nearly three-quarters of Ohioans older than 21. MJBizDaily projects that adult-use sales could reach $1.5–$2B in the first year and $3.5–$4B by year 4
New York City and state task forces have closed more than 1,000 illegal cannabis shops since Gov. Kathy Hochul signed a law expanding their enforcement powers. “Operation Padlock to Protect” has shut down more than 779 stores across the five boroughs since it launched in May. — NYC.gov
The New York State Illicit Cannabis Enforcement Task Force, meanwhile, has shuttered an additional 230 shops across the state
The city has seized $41 million in illegal cannabis products and issued more than $65 million in civil penalties since “Operation Padlock to Protect” kicked off
Legal cannabis sales in NYC increased by 72% in the 10 weeks since
Minnesota’s marijuana market takes a step toward next year’s launch as the state released a first draft of regulations. The Office of Cannabis Management’s proposed rules include potency limits and other technical requirements for growers, retailers and processors the state law didn’t cover. — Star Tribune
While some social equity applicants are beginning their process and dispensaries have opened on several Native American reservations, the rulemaking process needs to finish before the full application process can kick off, which should happen early next year
Missouri bans delta-8 and other hemp-derived products. Add Missouri to the growing list of states imposing bans on delta-8 and other intoxicating hemp-derived products. — MJBizDaily
Republican Gov. Mike Parson issued an executive order prohibiting the sale of products containing psychoactive cannabis compounds at retail locations, including liquor stores
Oklahoma imposes stricter rules for cannabis testing labs, seeks THCA ban. Oklahoma has enacted stricter standards for medical cannabis testing laboratories, including a state reference lab to double-check results and a secret-shopper program to discreetly obtain products to verify results. — MJBizDaily
Under Oklahoma’s revised rules, testing labs must follow new state-imposed standards, including instrumentation calibration and quality-control standards
There are also new failure thresholds for molds, solvents and heavy metals. Standards for identified pesticides will remain the same
MA Cannabis Commission says it failed to collect $555,671 in licensing fees over the last two years. Officials insist no money was stolen. — CommonWealth Beacon
The situation is the latest example of dysfunction at the commission, whose chairman is suspended and executive director has left and has yet to be replaced
A spokesperson for the agency said a license renewal extension fee was implemented in August 2022 to give applicants for cannabis licenses more time to file them. Extensions were granted to 161 applicants but the fees were never collected by commission staff
The commission offered no explanation for the failure to collect the fees or why the error went unnoticed for two years. However, it said the commission is in the process of collecting the unpaid fees and implementing procedures to make sure the funds are collected in the future
Ken Griffin has pledged $12M to defeating Amendment 3. Griffin, the billionaire Founder and CEO of Citadel, called it a terrible plan to create the nation’s most expansive and destructive marijuana laws. — MJBizDaily
“Passage of Amendment 3 would create a monopoly for large marijuana dispensaries and permit pot use in public and private areas throughout Florida,” Griffin alleged in his op-ed
PKFOD believes that companies should heed the IRS warning and hold off filing amended returns until the DOJ rulemaking process is final and that marijuana is officially not considered a Schedule I Controlled Substance.
Most recalls are issued too late to recover cannabis products potentially containing unhealthy levels of mold or pesticides
💵 Deals
Growlink closes $2M Seed led by Casa Verde Capital. Growlink is a leading controlled environment agriculture (CEA) provider of advanced IoT controllers, sensors, and cultivation software. For the past 10 years, Growlink has operated profitability without any external funding or debt, steadily growing its customer base to over 2,200 active locations in 35 countries. Growlink is currently utilized by a majority of MSOs. This fundraise will enable the company to expand its AI capabilities and enhance its third-party integration platform. This ensures that any hardware can connect to the Growlink cloud. Users will gain access to Growlink's advanced control algorithms, cultivar blueprints, and AI crop steering programs.
TerrAscend closed $140 million senior secured term loan from FocusGrowth. The Loan includes an initial draw of $114 million in gross proceeds by certain of the Company’s Consolidated Entities in Pennsylvania, Maryland and California, with a second draw of $26 million in gross proceeds expected in September 2024 by the Company’s Consolidated Entities in Michigan. The Loan carries an interest rate of 12.75%, matures in August 2028, contains no prepayment penalties, and is guaranteed by the Company and TerrAscend USA, Inc. No warrants were issued as part of the Loan. The proceeds from the initial draw were used to retire the Company’s existing indebtedness in Pennsylvania with the remainder available for potential M&A transactions focused on geographic expansion. The proceeds from the second draw will be used to retire the Company’s existing indebtedness in Michigan.
Jushi refinances ~$53 million senior secured credit facility due December 31, 2024 through the issuance of a new $48.5 million senior secured Term Loan and use of ~$7.4 million from cash on hand. The Term Loan was issued at a 2.0% original issuance discount and bears an interest rate of 12.25% per annum, payable quarterly. The Term Loan amortizes at the rate of 2.5% per quarter beginning 12 months after the closing date and matures on the earlier of 30 months from the closing date or 91 days prior to the maturity of the Company’s existing Second Lien Notes due December 7, 2026. The Term Loan is guaranteed by certain current and future direct and indirect subsidiaries of the Company and secured by first priority liens on certain assets of the Company and certain of the Company’s direct and indirect subsidiaries. Investors providing the Term Loan to the Company received five-year Warrants at 40% coverage and with an exercise price per share equal to $1.00.
Jones Soda closes first and second tranche of $3.6M private placement. The company raised $3M in the first tranche and $640K in the second tranche. The units of are composed of one common share and one‐half (1/2) of a purchase warrant.
Digicann Ventures and 3WIN Sign Binding LOI for Proposed RTO Transaction. 3WIN is a global wholesale distributor of CCELL® vape products.
📄 Company Updates
Trulieve Q2 2024 Results. Revenue of $303M, up 2% sequentially and 8% Y/Y, and 60% GM. Achieved EBITDA of $88M, or 29% of revenue and adjusted EBITDA of $107M, or 35% of revenue, up 1% sequentially and 36% Y/Y. Generated cash flow from operations of $71M and free cash flow of $45M. $355M in cash.
GTI Q2 2024 Results. Revenue of $280M, increased 11% Y/Y. GAAP Net Income of $21M or $0.09 per basic and diluted share, Adjusted EBITDA of $94M or 34% of revenue, Six months CFO of $104M, net of $53M of tax payments, Cash at quarter end of $196M. The company also purchased 1,658,000 shares for a total of $20M in Q2.
AWH Q2 2024 Results. Net revenue increased 15.1% Y/Y and decreased 0.6% Q/Q to $141.5M, Net loss of ($21.8M), Adjusted EBITDA was $28.3M, representing a 20.0% margin, As of June 30, 2024, cash and cash equivalents were $83.7M and net debt was $225.6M.
IIP Q2 2024 Results. Total revenues of $79.8M and net income attributable to common stockholders of $41.7M, or $1.44 per share.
Turning Point Brands Q2 2024 Results. Zig-Zag Products net sales increased 8.0%, Stoker’s Products net sales increased 18.5%. Adjusted EBITDA increased 6.9% to $27.0M. Company increases full-year 2024 adjusted EBITDA guidance to $98–$102M.
🏬 Retail
Snoop Dogg to open S.W.E.D. in Amsterdam. Following the successful launch of his first S.W.E.D. store in LA in July, the Amsterdam location represents a significant step in the global expansion of S.W.E.D. The coffee shop brings Snoop’s signature style and passion for cannabis culture to a city celebrated just as much for its cannabis cafes as it is for its famed canals.
Saint Peter’s University withdraws lawsuit to stop the opening of Xena dispensary. The Jersey City school had sued Xena, formerly known as Medusa, arguing that the dispensary, located at 759A Bergen Ave., violated a requirement for it to be at least 200 feet from school property, stretch the definition of “school” under state statutes. The term “school” traditionally refers to K-12 schools under such laws; and the Saint Peter’s property in question is a dormitory building. But the university withdrew the lawsuit without explanation Friday, nearly two years after it was filed, according to court filings. Xena owner Haytham Elgawly said Monday that there was no settlement in the litigation.
The Flowery opens its 9th Florida location in Hollywood, FL.
GTI opens RISE Dispensary East Syracuse. The new East Syracuse location marks five RISE Dispensaries open in New York and 97 nationwide.
C3 Industries opens its first Connecticut dispensary, High Profile Canton. The new dispensary is Canton’s first and one of several planned for C3 Industries; it plans to open another dispensary in Hamden.
Harvest House of Cannabis opens Santa Monica’s second dispensary.
🌱 Product
The Cannabist Company Expands Airo Brands Partnership with Launch of Fast Onset Oria Edibles in New Jersey. The Cannabist Company first teamed up with Airo in November of 2023 in Delaware, with its cutting-edge vaporizers and oils quickly becoming top-selling products at Cannabist locations state-wide and expanded into West Virginia earlier this year. Additional market launches and products will continue to roll out in the coming months, pending regulatory approval.
🧔 People
AYR Wellness Director and Executive Chairman Jonathan Sandelman has resigned and stepped down from his role. The board of directors of the Company has determined that Mr. Louis Karger is now the chairman of the board. Sandelman has served on the board of AYR since 2017 and has resigned to pursue other opportunities (Mercer Park Opportunities SPAC).
🎙️ Interviews
Tiffany Chin: Snoop Dogg’s right-hand woman at Death Row Cannabis | GMR
Bloomwell Group CEO Niklas Kouparanis | MJBizDaily
S3 Comments Review and 2Q Earnings Preview | Higher Exchanges
How Top Cannabis Companies Keep and Attract Employees ft. Mike Siebold | The Dime