Rising High: Cannabis firms report quarterly earnings

In this week’s “Rising High,” The Fly’s recurring series focused on cannabis and psychedelic stock news, The Fly looks back on cannabis earnings, an acquisition update and an Innovation Passport designation.

CANNABIS EARNINGS: On Friday, Entourage Health (ETRGF) reported third quarter revenue of C$13.6M, which compared to revenue of C$12.3M last year.  “Over the past year, we’ve focused on creating products that truly meet the needs of our customers and patients,” said George Scorsis, CEO. “With the holidays approaching, we are excited to introduce several highly anticipated products, demonstrating our commitment to delivering meaningful and timely offerings. As the cannabis industry stabilizes, our team’s creativity and operational focus on optimizing the business will position us as a market leader. We look forward to the year ahead with a strong product pipeline planned for 2025.”

RIV Capital (CNPOF) also reported Q3 results on Friday, with a loss per share of (46c) on revenue of $4.9M, which compared to a loss per share of (5c) on revenue of $1.7M last year. “Since the launch of adult-use sales in New York this year, we have achieved significant growth, driven by our ongoing enhancements to customer retail experiences and commitment to delivering exceptional customer service,” said Dave Vautrin, Interim CEO. “With our operations scaling as patient and consumer demand continues to build, we experienced significant acceleration in the third quarter results, demonstrated by our record net revenue of $4.9M. We now proudly operate three co-located adult-use and medical retail dispensaries, plus an additional medical-only location, across our footprint, and customer response has been great, with especially strong enthusiasm following the launch of the highly popular MOODS brand by FLUENT into the New York market. As we continue to improve our retail network, we’re also scaling our wholesale operations, with a growing pipeline of approximately 60 retailers. With the recent strategic distribution agreement with Nabis, we’re well-positioned to support this rapid growth across the state. This momentum has continued into the fourth quarter.”

Additionally on Friday, Cansortium (CNTMF) reported a Q3 loss per share of (4c) on revenue of $26.1M, which compared to a loss per share of (2c) on revenue of $25.3M last year. “We completed the third quarter by delivering our 12th consecutive quarter of positive cash flow from operations as well as steady year over year revenue growth,” said CEO Robert Beasley. “Our focus on continuous improvement and gaining efficiencies has continued to be a positive contributor to our solid performance. In Florida, we have increased our cultivation canopy to remain in balance with strong medical market demand and anticipate adding four new stores in 2025 while expanding our brand and product portfolio. Fortunately, our growth strategy did not depend on the outcome of Amendment 3 passing in Florida and we have made no financial commitments which depended on the adult use measure. FLUENT remains committed to the mission of serving the medical cannabis patients of Florida. Looking ahead, with our primary loan refinancing completed and our business combination with RIV Capital set to close by year end, our business is exceptionally well positioned heading into 2025. We have already commenced integration activities and are looking forward to leveraging the combined talent of both teams to scale our market share in the state of New York. Additionally, we also continue to seek out opportunities to drive revenue growth in both Pennsylvania and Texas.”

The company also announced on Monday an expansion of its MOODS vaporizer line, bringing two new premium extensions to consumers in New York and Florida. Available now, adults across the Empire State can purchase MOODS Black at all Etain Health locations, while MOODS Winter is available exclusively to medical marijuana patients at all FLUENT locations across the Sunshine State.

Red White & Bloom (RWBYF) also reported Q3 earnings Friday with earnings per share of 0c on revenue of $21.7M, which compared to a loss per share of (1c) on revenue of $20.1M last year. Colby De Zen, President, stated, “Our primary focus has been, and remains, optimizing the business through careful analysis of all legacy, non-core assets and operations, with the goal of transitioning RWB into a profitable enterprise. Over the first nine months of the fiscal year, we have made significant strides toward achieving our strategic objectives. Our EBITDA has increased 20 times compared to the same period last year, reaching approximately $7.5M . Adjusted EBITDA stands at $9.6M for the same period. These improvements reflect all of the RWB team’s efforts in achieving more profitable revenue streams through organizational efficiencies and exiting unprofitable product lines and ventures. In the third quarter, the construction of five new medical dispensary locations in Florida progressed as planned, with all locations set to become operational within the next three to four months. Our Florida operations also saw a notable increase in same-store revenues, driven by new Platinum-branded products and customer engagement efforts. In California, the Company established a key value chain partnership which has already enhanced prospects within our distribution network. In Canada, Emblem expanded its distribution network by adding Prince Edward Island and New Brunswick, with another province set to launch in our fourth quarter, while increasing product listings across all existing provinces. To support this growth, investments in offtake agreements, cultivation, and production operations across the United States and Canada remain on track to mitigate supply chain risks in fiscal 2025. RWB continues to leverage synergies, prioritize cost savings, execute targeted divestitures, and grow profitable business segments to increase shareholder value.”

CANOPY GROWTH, ACREAGE PROVIDE ACQUISITION UPDATE: On Monday, Canopy Growth Corporation (CGC) and Acreage Holdings (ACRHF) announced that it is anticipated that Canopy USA will complete its acquisition of Acreage on or around December 9, 2024, subject to the satisfaction or waiver of closing conditions. Canopy Growth and Acreage are party to an arrangement agreement ‎dated April 18, 2019, as amended, relating to the proposed acquisition of all issued and outstanding Class E subordinate voting shares of Acreage. The Fixed Share Acquisition is anticipated to occur immediately after the acquisition ‎of the Class D subordinate voting shares of Acreage pursuant to a plan of ‎arrangement under the Business Corporations Act in accordance with the arrangement agreement dated October 24, 2022, as amended, among Canopy Growth, Acreage and Canopy ‎USA. Upon the closing of the acquisitions, Canopy USA will own 100% of the issued ‎and outstanding shares of Acreage.‎ As previously announced by Acreage, if the price of the common shares of Canopy Growth on the Nasdaq does not go above $5.00 prior to closing of the acquisitions, holders of Fixed Shares will not receive any consideration in exchange for their Fixed Shares.

Additionally on Wednesday, Canopy Growth announced the launch of two holiday-inspired cannabis products from Tweed, including a sugar-free Cranberry Ginger Ale and Tweed Snowtorious 91K flower.

MINDMED AWARDED INNOVATION PASSPORT DESIGNATION: Mind Medicine (MNMD) announced Thursday that MM120 ODT, a pharmaceutically optimized form of lysergide D-tartrate, has been granted an Innovation Passport for the potential treatment of GAD under ILAP by the U.K. Medicines and Healthcare products Regulatory Agency. “Receiving the Innovation Passport designation is recognition of MM120 ODT’s potential to address GAD, one of the most critical and underserved needs in mental health,” said Rob Barrow, CEO. “Following the receipt of Breakthrough Therapy Designation by the U.S. Food and Drug Administration, the Innovation Passport designation underscores our commitment to bringing MM120 ODT to people living with GAD and our dedication to working closely with the MHRA to expedite patient access. We are determined to offer new hope and transformative solutions where current treatments have failed to meet the needs of those who suffer from this serious condition.”

RELMADA EVALUATING NEXT STEPS FOR REL-1017: Relmada Therapeutics (RLMD) announced Wednesday that the pre-planned interim analysis of Reliance II, conducted by the Independent Data Monitoring Committee, indicated that the Reliance II Phase 3 study is futile and is unlikely to meet the primary efficacy endpoint with statistical significance. Reliance II is designed to evaluate REL-1017 as an adjunctive treatment for major depressive disorder, to be used in combination with other approved anti-depressants. No new safety signals were reported. “We are disappointed with the outcome of this interim analysis,” said Sergio Traversa, CEO. “Based on these results, Relmada will evaluate the full dataset to determine next steps for the REL-1017 program. The Company will continue to advance the Phase 1 study of REL-P11, an investigational agent for the treatment of metabolic disease, currently in a Phase 1 first-in-human study. We are grateful to the investigative sites and patients who participated in the REL-1017 program.”

Following the report, Leerink downgraded Relmada Therapeutics to Market Perform from Outperform with a price target of $1, down from $10. The firm, which has removed REL-1017 revenues from its model and have added nominal revenues for REL-P11 starting in 2032 while awaiting additional data, told investors that based on the news “it makes sense to move to the sidelines.”

Mizuho also downgraded Relmada Therapeutics to Neutral from Outperform with a price target of $1, down from $23. The Data Monitoring Committee finding of futility is “truly disappointing and likely means the end of the line” for REL-1017 in major depressive disorder, said the analyst, who removed the firm’s sales forecast, with a previous peak sales assumption of $1.7B, and corresponding spending assumptions related to REL-1017 from the firm’s model. Relmada has a second asset, REL-P11, which is low-dose, modified-release psilocybin formulation to treat metabolic diseases, but REL-1017 was “clearly the more important asset,” the analyst added.

HIGH TIDE TAKES CABANA CLUB GLOBAL: High Tide (HITI) marked Cyber Monday by expanding the Cabana Club membership program across the entirety of the United States as well as the European Union and the United Kingdom. The company is also adding international snacks and confectionary to its e-commerce offerings, which already include hemp-derived CBD products, consumption accessories and related merchandise. “Innovation and market disruption are at the core of High Tide’s DNA, and today marks another milestone in our journey. I am excited to announce that, in celebration of Cyber Monday, we are taking our highly successful Cabana Club membership program global. The CBD and consumption accessory markets are still fragmented across the U.S. and Europe, which presents a significant opportunity for High Tide to lead consolidation efforts as we expand our international e-commerce footprint. With our proven track record, I am confident that we will disrupt the global online space in the same transformative way we’ve reshaped the Canadian cannabis landscape,” said Raj Grover, CEO.

CANNABIS/PSYCHEDELIC STOCKS: Publicly-traded companies in the space include Ascend Wellness (AAWH), Atai Life Sciences (ATAI), Aurora Cannabis (ACB), Avant Brands (AVTBF), Ayr Wellness (AYRWF), Cannabist Company (CBSTF), Cannara Biotech (LOVFF), Chicago Atlantic (REFI), Clearmind (CMND), Clever Leaves (CLVR), Compass Pathways (CMPS), CordovaCann (LVRLF), Cresco Labs (CRLBF), Cronos Group (CRON), Curaleaf (CURLF), CV Sciences (CVSI), Cybin (CYBN), Enveric Biosciences (ENVB), Flora Growth (FLGC), Trees Corporation (CANN), Greenlane (GNLN), Green Thumb (GTBIF), GrowGeneration (GRWG), Hemp (HEMP), IGC Pharma (IGC), IM Cannabis (IMCC), Innovative Industrial Properties (IIPR), InterCure (INCR), Ispire Technology (ISPR), Lowell Farms (LOWLF), Lucy Scientific Discovery (LSDI), MediPharm Labs (MEDIF), NewLake Capital (NLCP), Numinus Wellness (NUMIF), Optimi Health (OPTHF), Organigram (OGI), PharmAla (MDXXF), Planet 13 (PLNH), Psyence Biomedical (PBM), Reunion Neuroscience (REUN), Safe Harbor (SHFS), SNDL (SNDL), Skye Bioscience (SKYE), Stem Holdings (STMH), TerrAscend (TRSSF), Tilray (TLRY), Trulieve (TCNNF), Tryp Therapeutics (TRYPF), Verano (VRNOF), Village Farms (VFF), Vireo Health (VREOF) and 4Front Ventures (FFNTF).