The Société québécoise du cannabis (SQDC) ended its 16-week third quarter on January 2, 2021. During the quarter, it recorded sales of $173 million, a $62.2 million increase from the third quarter of the preceding fiscal year. The company also reported net income of $23.3 million for the quarter, compared with $11.6 million for the same quarter in fiscal 2019-2020.
At the end of the first 40 weeks of its 2020-2021 fiscal year, the SQDC posted net income of $48.1 million, compared with $17.9 million at the end of the same period in the preceding fiscal year. The entire amount will be remitted to the Quebec government and reinvested primarily in cannabis research and prevention. To this result can be added the government revenue from operations in the form of excise and consumer taxes, which totalled approximately $48.5 million for the third quarter and nearly $127.1 million for the first 40 weeks of the fiscal year.
The SQDC’s significant growth is largely attributable to its retail deployment plan. 11 new points of sale were opened during the quarter, for a total of 56 stores currently in operation, 23 more than on the same date last year. The SQDC remains confident of exceeding its current fiscal year targets and of continuing to carry out its mission of converting users from the illegal market while maintaining a focus on health protection.
Quarterly results at a glance
- The SQDC recorded sales of $173 million for the period from September 13, 2020, to January 2, 2021. This corresponds to 28,254 kg of cannabis legally sold during the quarter.
- The store network dispensed 26,239 kg of cannabis, with sales totalling $159.2 million. Around 3.3 million transactions took place.
- Online sales reached 2,075 kg of cannabis for a total of $13.8 million. Some 170,000 transactions were concluded.
- Net expenses amounted to $20.2 million or 11.7% of sales.
- During the quarter, 11 new points of sale in six Quebec regions were added to the network, specifically in La Malbaie, Coaticook, Saint-Félicien, Fleurimont (Sherbrooke), Le Village (Montreal), Varennes, Sainte-Anne-de-Beaupré, Avenue du Mont-Royal Est (Montreal), Thetford Mines, Cowansville and Pincourt. All new employees underwent rigorous training developed in collaboration with the Ministère de la Santé et des Services sociaux.
- October 17, 2020, was the second anniversary of the legalization of cannabis and the opening of the SQDC’s store network and website. At the end of the quarter, the company estimated it had captured around 50% of the illegal cannabis market, notably by relying on a pricing and product strategy that is both competitive and responsible and offers the lowest average price in Canada. Since the first SQDC stores opened two years ago, more than 17 million transactions have taken place in a safe environment under the guidance of trained advisors, confirming the SQDC’s mission of selling cannabis with a focus on health protection.
- Always striving to better carry out its mission, the SQDC extended same-day delivery first to the city of Laval and then to some 15 towns and cities on Montreal’s South Shore and in the western Montérégie region. Originally available only on the island of Montreal, the service will be introduced in other areas in the coming year.
The health measures implemented in response to COVID-19 have allowed stores to provide a safe environment for employees and consumers. SQDC stores remained open without interruption during the quarter, as they have since the start of the pandemic.
The interim financial report for the 16-week quarter ended January 2, 2021, is now available (in French) on SQDC.ca.
About the Société québécoise du cannabis (SQDC)
The SQDC is a government corporation mandated to distribute and sell cannabis in Quebec with a focus on protecting customers’ health and safety. The company is committed to offering quality products and informing and advising consumers on how to minimize the health impacts of cannabis. The long-term goal is to shrink the illegal cannabis market in Quebec. By law, all of the SQDC’s profits are remitted to the Cannabis Prevention and Research Fund, which is managed by the Quebec Finance Department, and reinvested primarily in cannabis-related prevention and research. For more information, visit sqdc.ca.