High Tide Inc Reports Record Q3 2024 Financial Results
Intellectia.AI2024-09-17
High Tide Inc. Reports Record Q3 2024 Financial Results
High Tide Inc. (Nasdaq: HITI), a leading cannabis retailer, released its financial results for the third fiscal quarter of 2024 ended July 31, 2024. The company reported record revenue and continued positive financial performance.
Key Financial Metrics:
| Metric | Q3 2024 | Q3 2023 | Sequential Comparison | Consensus Estimates |
|---|---|---|---|---|
| Revenue | $131.7M | $124.4M | +6% | $94.35M |
| Gross Profit | $35.5M | $34.6M | +3% YoY, Flat QoQ | N/A |
| Net Income | $0.8M | $(3.6)M | Improved | N/A |
| Earnings Per Share (EPS) | $0.01 | $(0.04) | Improved | $(0.02) |
| Adjusted EBITDA | $9.6M | $10.2M* | Slight Decrease | N/A |
| Cash and Cash Equivalents | $35.3M | $25.7M | +37% YoY | N/A |
*Note: Q3 2023 included a $2.4 million benefit from the SRF removal in Manitoba.
High Tide exceeded consensus estimates for revenue and earnings per share, demonstrating remarkable resilience and robust growth in a challenging environment. The company's continued positive net income and free cash flow reflect strong operational management.
Revenue Breakdown by Segment:
| Segment | Q3 2024 Revenue | Q3 2023 Revenue | Variance |
|---|---|---|---|
| Cabanalytics and Other Revenue | $9.0M | $6.7M | +36% |
The company’s Cabanalytics business, along with other revenue streams, showed strong growth, showcasing the effectiveness of its diversified approach to revenue generation.
Operational Highlights:
- Opened 11 new Canna Cabana locations in Alberta, Saskatchewan, and Ontario.
- Increased Cabana Club membership to over 1.55 million, a 41% year-over-year growth.
- Achieved a 12% market share in Canadian provinces where operations are present, up from 10% a year ago.
- Announced a joint venture with Positive Intent Events to explore Canada's emerging cannabis hospitality sector.
Comments from CEO Raj Grover: "High Tide stands out as a well-managed, innovative company amid industry turbulence. Our record revenue and continued free cash flow highlight responsible growth strategies and value creation for shareholders. We have surpassed initial store expansion targets and expect to reach further milestones with our robust growth strategy," said Raj Grover, CEO of High Tide.
Shareholder Returns and Forward Guidance: While no specific dividend or share repurchase programs were announced, High Tide emphasizes maintaining a healthy cash position to support organic growth and strategic initiatives. The company expects to reach the high end of its store expansion target by the end of 2024, maintaining positive free cash flow throughout.
Stock Price Movement Post-Earnings: Following the earnings release, High Tide's stock experienced a minor decline of 1.03%, reflecting investor caution despite the company’s strong performance metrics and positive outlook.
In summary, High Tide continues to advance its leadership position in the cannabis retail sector, driven by strategic store expansion, diversified revenue streams, and a strong financial foundation.
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