Cannabis News
$9 Billion in Revenue and $2 Billion in Losses
The “marijuana mullet” is back with avengence in the cannabis industry as great top-line, headline-shocking, numbers for revenue got released with the usual massive losses on the bottom line, as usual.
Last year, an analysis of public filings by Green Market Report revealed that among the twenty largest publicly traded marijuana companies in the U.S., only one managed to turn a profit, while the rest collectively incurred a hefty $2.3 billion in losses. Despite generating over $8.7 billion in revenues altogether, these vertically integrated operators, with retail outlets, cultivation facilities, and manufacturing plants across various states, struggled to remain profitable.
These financial figures offer a glimpse into the overall performance of the cannabis sector. In 2022, a similar examination of financial filings indicated that merely two out of twenty-four public cannabis companies were profitable, with the sector as a whole facing losses exceeding $4 billion. However, it appears that losses have notably decreased year-over-year, signaling potential improvements in the industry’s financial landscape.
Top Performers and Underperformers
Green Thumb Industries (CSE: GTII) (OTCQX: GTBIF), based in Chicago, became the only cannabis firm to record net profits in 2023, with a $36.3 million profit on top of an amazing $1.1 billion in sales. This was a huge increase above its $12 million profit in 2022, demonstrating a stunning triple of yearly earnings.
In contrast, Florida’s Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) experienced the most significant setback of the year, with a whopping $527 million loss compared to $1.13 billion in sales.
However, Trulieve was not alone in its financial struggles. Curaleaf Holdings (TSX: CURA) (OTCQX: CURLF) of New York incurred losses of $281.2 million, despite leading in revenue among the twenty companies with an impressive $1.35 billion.
GTI, Trulieve, and Curaleaf were the exclusive trio to surpass the $1 billion revenue mark last year.
Other notable underperformers include:
– Ayr Wellness (CSE: AYR.A) (OTCQX: AYRWF), a Florida-based multistate operator, recorded a loss of $272 million.
– Cresco Labs (CSE: CL) (OTCQX: CRLBF) (FSE: 6CQ), headquartered in Chicago, faced losses amounting to $180 million.
– The Cannabist Co. Holdings Inc. (NEO: CBST) (OTCQX: CBSTF) (FSE: 3LP) from New York, reported losses of $174 million.
– Verano Holdings Corp. (Cboe CA: VRNO) (OTCQX: VRNOF), based in Chicago, incurred losses totaling $113 million.
The widespread financial struggles within the industry underscore the urgency behind potential regulatory changes, such as the Biden administration’s proposed shift of marijuana from Schedule I to Schedule III. Such a move could alleviate the industry’s tax burdens, potentially saving hundreds of millions annually, as estimated by various sources. However, the timeline for realizing these savings remains uncertain.
Market Upheaval
The dissimilarity between the evaluations from this year and the previous year emphasizes the volatility of the market, which is further emphasized by the removal of four firms from this year’s list.
MedMen Enterprises (CSE: MMEN) (OTCQX: MMNFF), one of the absentees, has essentially filed for bankruptcy. Due to a change of auditors, StateHouse Holdings (CSE: STHZ) (OTCQB: STHZF) and Vext Science (VEXTF) have not yet submitted their full-year financial reports to securities regulators.
The fourth omission, secondary multistate operator Red White & Bloom Brands (CSE: RWB), reported losses of $104.9 million and carried a debt of $240 million in the previous year, against revenues of $88.3 million disclosed in April.
According to Matt Karnes, Founder of GreenWave Advisors, the persistent losses stem from the exorbitant costs of operating within the federally illegal U.S. marijuana industry.
“Profitability and cash generation are formidable challenges,” Karnes remarked. “This underscores the urgency for government intervention… because financial resources are depleting rapidly. Section 280E is proving to be detrimental to all.”
Karnes acknowledged additional factors contributing to the sector’s financial downturn, including misplaced optimism surrounding the initial public offerings of many fledgling companies in recent years, and an underestimation of the competitive pricing in the illicit marijuana market.
Furthermore, political advancements at the federal level have been notably delayed compared to earlier industry expectations, resulting in failed expansion endeavors, unproductive infrastructure investments, and widespread price pressures, all culminating in diminished profit margins for the cannabis sector.
“The inability to accurately forecast when these dynamics will change, to decipher the political landscape effectively, presents significant challenges,” Karnes concluded regarding the ongoing financial setbacks. “This uncertainty remains a substantial obstacle.”
Emerging Trends and Future Outlook
Even in the face of economic uncertainty, several new developments in the cannabis sector point to possible directions for expansion and stability. The growing focus on cost control and operational efficiency is one such trend. Businesses are actively looking for creative ways to save expenses by simplifying their processes, allocating resources as efficiently as possible, and lowering overhead. These businesses want to improve their bottom line and lessen the effects of market and regulatory uncertainty by concentrating on efficiency.
The diversity of product offerings and market tactics is another noteworthy development. Companies that deal with cannabis are branching out from typical flowers and investigating new product categories including drinks, topicals, edibles, and wellness items. Targeting specialized markets and customer groups and customizing items to fit their requirements and tastes is also becoming more and more important. By lowering reliance on any one product or market segment, this diversification not only increases the variety of revenue streams but also fortifies the resilience of the market.
Looking ahead, the industry’s future prognosis is heavily reliant on regulatory developments and policy changes. The Biden administration’s prospective reclassification of marijuana from Schedule I to Schedule III may have far-reaching consequences for the business, including lower tax costs and better access to financial services. However, the timing and breadth of regulatory changes are unknown, providing hurdles for businesses navigating the changing regulatory landscape. Despite these uncertainties, ongoing innovation, strategic adaptability, and a focus on long-term sustainability will be critical in determining the cannabis industry’s resilience and development prospects in the coming years.
The other main problem the industry may never be able to overcome is, as Jeff Bezos put it so well, “your margins are my opportunity“. Once the 280E tax breaks get worked through the system, and that cash bonanza gets dispursed, the industry will always face the unrelenting pressure of the illicit or black market. As soon as prices start to get too high, where stores and brands start to increase margins, the illicit market will become that much more appealing for their lower prices. If the legal industry tries to push prices too high, the black market will snag market share from more price conscious consumers. There is a glass ceiling on how high the legal market will ever be able to raise their prices due to price pressures on the black market.
While consumers may pay for the appearance of safety through lab testing and the convience of a brick-and-mortar store, the fact remains that cannabis flower is 60% cheaper on the illicit market and edibles can be up to 93% cheaper when local and state taxes are taken into account. People will price shop when the spread between legal products and illicit products widen to unreasonable amounts.
Bottom Line
The cannabis industry’s financial struggles, as highlighted by the significant losses incurred despite substantial revenues, underscore the need for regulatory reforms and operational adaptations. While some companies have managed to thrive, many others have faced considerable setbacks, grappling with challenges ranging from regulatory constraints to market volatility. The emergence of new trends, such as cost management initiatives and product diversification, offers avenues for growth and resilience in the face of uncertainty. However, the industry’s future trajectory will largely depend on the pace and scope of regulatory changes, as well as companies’ ability to innovate and adapt to evolving market dynamics.
Margin compression and the ever-looming black market may always create a glass ceiling for cannabis product prices going forward. Push to hard on a string and the consumer will look to save up to 85% on prices by finding a new piece of twine.
THE MARIJUANA MULLET, GREAT ON TOP, BAD ON THE BOTTOM, READ ON…
“How Long Does One Puff of Weed Stay in Your System?”… This topic can be difficult to answer since it is dependent on elements such as the size of the hit and what constitutes a “one hit.” If you take a large bong pull then cough, it might linger in your system for 5-7 days. A moderate dose from a joint can last 3-5 days, whereas a few hits from a vaporizer may last 1-3 days.
The length of time that marijuana stays in the body varies based on a number of factors, including metabolism, THC levels, frequency of use, and hydration.
Delta-9-tetrahydrocannabinol, or THC, is the primary psychoactive component of cannabis. THC and its metabolites, which remain in your body long after the effects have subsided, are detected by drug tests.
Since these metabolites are fat-soluble, they cling to bodily fat molecules. They could thus take a while to fully pass through your system, particularly if your body fat percentage is higher.
THC is absorbed by tissues and organs (including the brain, heart, and fat) and converted by the liver into chemicals such as 11-hydroxy-THC and carboxy-THC. Cannabis is eliminated in feces at a rate of around 65%, while urine accounts for 20%. The leftover amount might be kept within the body.
THC deposited in bodily tissues ultimately re-enters the circulation and is processed by the liver. For frequent users, THC accumulates in fatty tissues quicker than it can be removed, thus it may be detectable in drug tests for days or weeks following consumption.
The detection time varies according to the amount and frequency of cannabis usage. Higher dosages and regular usage result in longer detection times.
The type of drug test also affects detection windows. Blood and saliva tests typically detect cannabis metabolites for shorter periods, while urine and hair samples can reveal use for weeks or even months. In some cases, hair tests have detected cannabis use over 90 days after consumption.
Detection Windows for Various Cannabis Drug Tests
Urine Tests
Among all drug tests, urine testing is the most commonly used method for screening for drug use in an individual.
Detection times vary, but a 2017 review suggests the following windows for cannabis in urine after last use:
– Single-use (e.g., one joint): up to 3 days
– Moderate use (around 4 times a week): 5–7 days
– Chronic use (daily): 10–15 days
– Chronic heavy use (multiple times daily): over 30 days
Blood Tests
Blood tests generally detect recent cannabis use, typically within 2–12 hours after consumption. However, in cases of heavy use, cannabis has been detected up to 30 days later. Chronic heavy use can extend the detection period in the bloodstream.
Saliva Tests
THC can enter saliva through secondhand cannabis smoke, but THC metabolites are only present if you’ve personally smoked or ingested cannabis.
Saliva testing has a short detection window and can sometimes identify cannabis use on the same day. A 2020 review found that THC was detectable in the saliva of frequent users for up to 72 hours after use, and it may remain in saliva longer than in blood following recent use.
In areas where cannabis is illegal, saliva testing is often used for roadside screenings.
Hair Tests
Hair follicle tests can detect cannabis use for up to 90 days. After use, cannabinoids reach the hair follicles through small blood vessels and from sebum and sweat surrounding the hair.
Hair grows at approximately 0.5 inches per month, so a 1.5-inch segment of hair close to the scalp can reveal cannabis use over the past three months.
Factors Affecting THC and Metabolite Retention
The length of time THC and its metabolites stay in your system depends on various factors. Some, like body mass index (BMI) and metabolic rate, relate to individual body processing, not the drug itself.
Other factors are specific to cannabis use, including:
– Dosage: How much you consume
– Frequency: How often you use cannabis
– Method of consumption: Smoking, dabbing, edibles, or sublingual
– THC potency: Higher potency can extend detection time
Higher doses and more frequent use generally extend THC retention. Cannabis consumed orally may remain in the system slightly longer than smoked cannabis, and stronger cannabis strains, higher in THC, may also stay detectable for a longer period.
How Quickly Do the Effects of Cannabis Set In?
When smoking cannabis, effects appear almost immediately, while ingested cannabis may take 1–3 hours to peak.
The psychoactive component THC produces a “high” with common effects such as:
– Altered senses, including perception of time
– Mood changes
– Difficulty with thinking and problem-solving
– Impaired memory
Other short-term effects can include:
– Anxiety and confusion
– Decreased coordination
– Dry mouth and eyes
– Nausea or lightheadedness
– Trouble focusing
– Increased appetite
– Rapid heart rate
– Restlessness and sleepiness
In rare cases, high doses may lead to hallucinations, delusions, or acute psychosis.
Regular cannabis use may have additional mental and physical effects. While research is ongoing, cannabis use may increase the risk of:
– Cognitive issues like memory loss
– Cardiovascular problems including heart disease and stroke
– Respiratory illnesses such as bronchitis or lung infections
– Mood disorders like depression and anxiety
Cannabis use during pregnancy can negatively impact fetal growth and development.
Duration of Effects
Short-term effects generally taper off within 1–3 hours, but for chronic users, some long-term effects may last days, weeks, or even months. Certain effects may even be permanent.
Bottom Line
The amount of time that cannabis remains in your system following a single use varies greatly depending on individual characteristics such as body fat, metabolism, frequency of use, and mode of intake. Frequent users may maintain traces of THC for weeks, whereas infrequent users may test positive for as little as a few days. Hair tests can disclose usage for up to 90 days, while blood and saliva tests identify more recent use. Urine tests are the most popular and have varying detection durations. The duration that THC and its metabolites are detectable will ultimately depend on a number of factors, including dose, strength, and individual body chemistry.
PEE IN A CUP COMING UP, READ ON..
Is kratom addictive? Discover the potential for dependence on Kratom, the risks involved with its use, and how to approach its consumption responsibly.
From 2011 to 2017, over 1,800 calls to poison centers involved kratom in the U.S. This significant number highlights the concern regarding kratom addiction.
However, without Food and Drug Administration (FDA) oversight, and due to various consumption methods like teas and capsules, there are significant health risks. Safe use of kratom is now in question due to these issues.
Research debates how dependence develops, outlining signs like loss of control and withdrawal symptoms. These signs are seen in regular kratom users. Ironically, some people switch from drugs like heroin to kratom, looking for a legal alternative.
Understanding Kratom: Origins and Prevalence
Kratom comes from the Mitragyna speciosa tree in Southeast Asia. It can act like a stimulant or like opioids, based on how much you take. People use it in different ways, for a small energy boost or stronger effects at higher doses.
The legal status of kratom in the U.S. is complicated and changing. It’s a hot topic because some worry about its misuse. It’s still legal in several states. This shows how different places handle drug rules. The National Institute on Drug Abuse is looking into its medical benefits. But, the FDA hasn’t approved it for medical use yet. The DEA calls it a “drug of concern,” which means policies might change.
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From 2011 to 2017, poison control centers in the U.S. got over 1,800 reports about kratom. This shows it’s widely used and might pose health risks.
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Kratom’s main ingredients bind to opioid receptors very strongly, stronger than morphine even. This fact is key to understanding its effects.
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As more people use kratom, more are reporting serious health problems. These include liver and heart issues, and tough withdrawal symptoms, particularly in those already sick.
The statistics show mounting worries about kratom in the U.S. As its use grows, it’s becoming more important to health policies and laws. What happens next will depend on further research and legal decisions.
Is Kratom Addictive: Investigating the Substance’s Nature
The question of kratom’s addictiveness focuses on how it affects brain receptors and its long-term health implications. The ongoing debate highlights concerns about dependence and the risk of addiction. Scientists are closely looking at these issues.
How Kratom Works in the Brain
Kratom’s main alkaloids, mitragynine and 7-hydroxymitragynine, bind to the brain’s opioid receptors, similar to painkillers and narcotics. This connection suggests a potential risk of dependence. These alkaloids are key to kratom’s pain relief but also point to possible addiction concerns, especially with frequent, high-dose usage.
Patterns and Consequences of Long-term Use
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Using kratom often, especially in large doses, can increase the risk of dependence and intense withdrawal symptoms, similar to opioid withdrawal.
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Although some use it for pain or to improve mood, long-term kratom users might see serious health problems, like liver damage and mental health issues.
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Withdrawal symptoms, including irritability, nausea, and sleep problems, show kratom’s impact on one’s physical and mental health.
Assessment of Addiction Risks
Studies indicate a significant risk of addiction to kratom, especially with high doses or frequent use. Dependence develops as the body gets used to kratom, leading to tolerance and a need for more to feel its effects. Withdrawal symptoms emphasize this risk, as highlighted by health experts.
Physiological Effects: Kratom’s Impact on the Body
There is a lot of debate about the safety and use of kratom. This herbal extract comes from the Mitragyna speciosa plant. It has drawn attention for its possible harmful effects on the body. The FDA has issued many warnings about kratom, raising safety concerns.
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Kratom Adverse Effects: Kratom users have reported side effects like nausea, vomiting, and confusion. More serious issues include high blood pressure and liver damage. These problems highlight the risks of using kratom.
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Herbal Extract Safety: Some kratom products contain heavy metals and pathogens. These can cause severe health issues, including death. This shows the importance of safety in herbal products.
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FDA Warnings and Regulations: The FDA has linked kratom to over 35 deaths and warns against using it. They point out the lack of medical uses and the risk of addiction.
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Physiological Impact: Kratom’s effects depend on the dose and the user’s body. Yet, it can lead to dangerous outcomes like liver damage and seizures.
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Safety Concerns from Authorities: Federal agencies like the DEA are worried about kratom’s safety. Although not a controlled substance, monitoring suggests users should be careful.
Kratom might offer temporary relief for some ailments, but it comes with significant risks. The FDA’s warnings should make people think twice. If considering kratom, it’s crucial to talk to a doctor first. Experts stress the need for safety and caution with herbal extracts.
Conclusion
Kratom’s role in health and regulation is complex, with views and research findings widely varied. Some people use kratom for its claimed health benefits, but it’s a hot topic. Experts advise caution and suggest consulting a doctor before using kratom due to the unclear effects.
Clinical studies using scores like SOWS and COWS haven’t confirmed withdrawal symptoms from kratom. This adds to the debate, especially when some users report withdrawal. This makes kratom a controversial subject among different findings and user experiences.
When it comes to treating opioid addiction, kratom can be both helpful and harmful. Some have used it successfully to fight addiction. Yet, some states have banned it. This highlights the need for regulations and consistent product quality. It also raises questions about kratom’s legal status due to mixed actions by authorities.
The situation shows how complex kratom is in the realm of substance use and law. Without clear evidence supporting either its benefits or risks, it poses a challenge. More research is needed to guide regulations and health advice. For now, anyone thinking of using kratom should be careful, seek medical advice, and keep up with laws and health guidelines.
WHAT IS KRATOM ANYWAY? READ ON…
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