High Tide Releases Audited 2022 Financial Results

Published: February 1, 2023

High Tide Releases Audited 2022 Financial Results

High Tide Inc., a leading retail-focused cannabis company with bricks-and-mortar as well as global e-commerce assets, filed its year-end audited 2022 financial results on January 30, 2023, the highlights of which are included in this news release. The full set of audited consolidated financial statements for the fiscal years ended October 31, 2022, and 2021 (the “Financial Statements“) and accompanying management’s discussion and analysis can be accessed by visiting High Tide’s website at www.hightideinc.com, and its profile pages on SEDAR at www.sedar.com, and EDGAR at www.sec.gov.


1Based on reporting by New Cannabis Ventures as of November 14, 2022. For the New Cannabis Ventures’ senior listing, segmented cannabis-only sales must generate more than US$25 million per quarter (CAD$31 million) – for full details, see: https://www.newcannabisventures.com/cannabis-company-revenue-ranking/

2Adjusted EBITDA is a non-IFRS financial measure

3This number includes all customers in High Tide’s global database across Cabana Club, Grasscity.com, SmokeCartel.com, DailyHighClub.com, Dankstop.com, NuLeafNaturals.com, FABCBD.com, BlessedCBD.co.uk, and BlessedCBD.de

2022 Fiscal Year – Financial Highlights

  • Revenue increased by 97% to $356.9 million for the year ended October 31, 2022, and increased sequentially by 14% to $108.2 million in the fourth quarter of 2022
  • Gross profit increased by 58% to $101.0 million for the year ended October 31, 2022, and increased sequentially by 15% to $29.5 million in the fourth quarter of 2022
  • Gross profit margin was 28% for the year ended October 31, 2022, and was 27% in the fourth quarter of 2022, which was consistent with each of the prior two quarters
  • Salaries, wages and benefits represented 12% of revenue in the fourth fiscal quarter of 2022 which compared to 15% in the fourth fiscal quarter of 2021 and was consistent with the prior quarter. General and administration expenses represented 7% of revenue in the fourth fiscal quarter of 2022, which compared to 8% in the fourth fiscal quarter of 2021 and was consistent with the prior quarter
  • Adjusted EBITDA4 was a record $14.6 million for the year ended October 31, 2022, up 17% versus the prior year, and was $5.0 million for the fourth quarter of 2022, up 18% sequentially, and up 206% versus the fourth quarter of 2021
  • Geographically, for the year ended October 31, 2022$290.4 million of revenue was earned in Canada (an increase of 93%), $59.3 million in the United States (an increase of 100%), and $7.1 million internationally (an increase of 671%). In the fourth quarter of fiscal 2022, revenue was $93.9 million in Canada (an increase of 16% sequentially), $13.2 million in the United States (an increase of 4% sequentially), and $1.2 million internationally (a decrease of 37% sequentially). This decrease is related to a global slowdown in sales of CBD products
  • Cabanalytics data sales from the entire retail ecosystem, including bricks and mortar and e-commerce platforms, were $21.7 million for the fiscal year that ended October 31, 2022, compared to $12.2 million for the fiscal year ended October 31, 2021. Sequentially, Cabanalytics data sales increased to $6.4 million from $5.5 million in the third fiscal quarter
  • The Company’s bricks-and-mortar locations generated same-store sales growth of 50% year-over-year and 9% sequentially in the fourth fiscal quarter of 2022. Given the success of our innovative discount club model, as well as the optional membership upgrade to ELITE, the Company anticipates same-store sales to continue to be strong compared to the industry average in the first fiscal quarter of 2023
  • During the fourth fiscal quarter of 2022, the Company completed its annual impairment testing. As a result of this testing, driven primarily by a slowdown in the global CBD sector as seen amongst our major United States CBD competitors, the Company recorded impairment charges of $48.6 million, primarily relating to goodwill. The Company notes that these are non-cash charges, with no impact on its ability to raise debt capital from its senior lender, and that online CBD sales represented only 6% of consolidated revenue for the fourth fiscal quarter of 2022
  • Cash on hand as of October 31, 2022, totalled $25.1 million, compared to $14.0 million as of October 31, 2021


4Adjusted EBITDA is a non-IFRS financial measure

“I am thrilled to share these results, which, once again, deliver record-breaking revenue and adjusted EBITDA which further solidifies High Tide’s position as the largest revenue-generating cannabis company in Canada with a current annual run rate of over $450 million. While these numbers demonstrate exponential revenue growth, it’s also important to note that we have maintained adjusted EBITDA level profitability for 11 consecutive quarters and that we were cash flow positive from operations during the last fiscal year. In our opinion, this is because we have the strongest retail concept in Canadian cannabis, something that is backed up by the fact that our Cabana Club loyalty program now has approximately 950,000 members across 151 Canadian stores. I am also excited to report that we have already upgraded over 6,000 members into ELITE. As we continue to introduce more ELITE offerings, we anticipate upgrades to continue throughout 2023, providing us with an additional high-margin recurring revenue stream to further boost our bottom line,” said Raj Grover, President and Chief Executive Officer of High Tide.

Letter of Intent with Sanity Group
High Tide also announced that it has entered into a non-binding letter of intent (the “LOI”) with the Berlin-based health and life science company, Sanity Group (the “Sanity Transaction”). With big progress on legislation expected this spring, the LOI is designed to leverage synergies between both complementary companies and position each to take advantage of potential German adult use legalization within their respective supply chain verticals. With a well-established track record in Germany with respect to medical cannabis, finished pharmaceuticals, and cannabinoid-based consumer goods, High Tide believes that Sanity Group is the best-positioned potential partner in its home market of Germany.

Fiscal Fourth Quarter 2022 – Operational Highlights

  • The Company closed on its acquisition of assets from Choom Holdings Inc. through the Companies’ Creditors Arrangement Act Proceedings, adding 9 operating retail cannabis stores to the Company’s bricks-and-mortar portfolio across British ColumbiaAlberta and Ontario for $5.3 million
  • The Company entered into and closed a binding commitment letter with Connect First Credit Union Ltd. (“connectFirst”) for a $19 million credit facility with an initial 5-year term, at connectFirst’s floor interest rate
  • The Globe and Mail’s Report on Business magazine recognized the Company for a second year in a row as one of Canada’s top-growing companies for 2022, ranking 21st out of 430 Canadian companies, with an audited growth rate of 1,970% over three years
  • The Company entered into a definitive agreement to add two retail cannabis stores in British Columbia via the acquisition of 1171882 B.C. Ltd., operating as Jimmy’s Cannabis Shop BC
  • The Company announced that its Colorado-based subsidiary, NuLeaf Naturals, launched its groundbreaking Full Spectrum Multi Cannabinoid oil and plant-based softgels for sale in Manitoba through the Manitoba Liquor & Lotteries Corporation and in Ontario through the Ontario Cannabis Store
  • Membership in the Cabana Club loyalty program increased to over 827,000 members as of October 31,2022
  • The Company added 13 new stores: 3 in British Columbia, 9 in Alberta and 1 in Ontario

Subsequent Events

  • The Company was declared the highest revenue-generating cannabis company in Canada5
  • The Company reached its communicated goal of 150 bricks-and-mortar stores across the country
  • The Company launched ELITE, the first-of-its-kind cannabis paid membership loyalty program in Canada converting over 6,000 members to ELITE status and generating over $180,000 in high margin revenue
  • The Company opened 10 new stores: 3 in British Columbia, 1 in Manitoba and 6 in Ontario
  • The Company initially launched cannabis seed sales through its subsidiaries GrassCity and Smoke Cartel and has now commenced sales on its Daily High Club and Dankstop e-commerce platforms
  • The Company completed the roll out of its proprietary Fastendr technology across 120 Canna Cabana locations
  • The Company now sponsors 302 children internationally through World Vision, after having committed to sponsoring two additional children for every new store that opens in Canada
  • Canna Cabana membership numbers as of today stands at approximately 950,000 members

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