Delta 9 Cannabis Inc DLTNF

Healthcare Cannabis

Delta 9 Cannabis Inc. is a Canada-based vertically integrated cannabis company. The Company operates through three segments: Wholesale Cannabis, Retail Cannabis and Merchandise and Devices, and Business to Business. The Company sells cannabis products through its wholesale and retail sales channels and sells its cannabis growing pods to other businesses. Its cannabis products include dried cannabis and pre-rolled joints. Its edibles and vapes include vape pens and concentrates, edibles, and drinkables. The Company, through its wholly owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical and recreational cannabis products and operates a 95,000-square-foot Health Canada licensed production facility in Winnipeg, Manitoba, Canada. It also owns and operates a chain of retail stores under the Delta 9 Cannabis Store brand. It is focused on producing and selling cannabis oils, extracts, and derivative products.

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Delta 9 Cannabis Inc > D9 Financial Call today

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Comment by StonksOnlyGoUpon May 18, 2022 2:30pm

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RE:RE:RE:RE:RE:RE:RE:D9 Financial Call today

To be clear, I never suggested it wasn't a good deal (certainly the price paid was way cheaper than anyother stores DN has aquired to date), nor am I suggesting DN doesn't have a bright future. I am simply suggesting it is possible that it takes longer to get there if last quarters results are largely a result of current inflationary pressures and that trend continues throughout the year.

Agreed the cost per gram is fantastic and I'm certain that we will see additional economy of scale in the coming quaters with all the new stores. However, the stores still need to keep sales up to fully realize those benefits.

Anyway, I'll still be buying crazy dips and hodl-ing, I remain long. And as you said, worst case if the weed market is hit hard by decreasing sales, it may be an opportunity ffor DN to aquire even more stores at an even better cost.

golfyeti wrote:
John said ebitda accretive so that is all I need to know for now about whether this was a good deal. DN just locked-in their debt costs at super low rates so I am not concerned with market rates rising.

Pod sales appear to have fallen off the map so revenues over the last handful of quarters include no big lumps of revenues that pods can bring. I really won't care if they dropped that part of the business anyway. It had great margins but the work orders are too inconsistent.

When M&A occurs in a nascent struggling over-poppulated industry you want to be with the consolidator vs the consolidated. That comes at a cost but John is acting prudently, picking through the rubble for bargains on a few sustainable businesses that got caught up in the valuation downdraft.

BTW, on company performance vis-a-vis costs of production...what matters is cost per gram. Again I see very responsible maangement. John said that their cost per gram dropped from $0.65 per gram at last report to now $0.58 per gram. That is a massive margin improvement that should dramatically improve cash flow.

Anyway I could go on and on but I think I have more than clarified my position that Delta 9 has a very bright future.