Planet 13 Holdings (PLNHF) is the best known of the Vegas cannabis companies. The company can now accept up to 264 customers in its large space, however experts predict it could take 12-18 months for the market to recover. Planet 13 has said that since most entertainment options at the casino’s aren’t available yet, it could be a substitution for the tourists with its aerial orb show and customer-facing cannabis production facility. Writes Real Money
Like 1933, Planet 13 has also made adjustments to weather the storm. The company reported that cash of $12.8 million at the end of 2019 versus 2018’s $19.4 million. The company’s cost of goods sold in the fourth quarter was $7 million and total expenses were $9.6 million. The company said it has pared back expenses, reduced fixed costs and expected that the SuperStore operations will be breakeven or better if the shutdown is extended indefinitely.
The company forecast a flat first quarter since the shutdown didn’t begin in earnest until March. The second quarter is probably where most of the pain will be experienced. Planet 13 shifted to a delivery model to attract more residents. Prior to the pandemic, locals only accounted for 50% of the sales and the company is hoping to appeal to more residents and then retain them going forward.
The Nevada Dispensary Association reported that in fiscal year 2019 the state collected $172 million in excise tax, sales tax, and licensing fees. Total taxable sales for 2019 were $692 million, a 20% increase from fiscal year 2018. The group released a report that projected by 2024 the collection of excise tax, sales, tax, and licensing fees will be as high as $237 million with total sales at $956 million. However, that was before the pandemic, and now the group says, “The projections going forward would likely fall short, especially given a drop in tourism and loss of sales in March and April, typically big sales months for Nevada dispensaries.”