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Trulieve Announces wider Q2 Loss; Cites Extreme Heat As a Factor

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Summary: Trulieve Cannabis reported a more significant loss in the second quarter, attributing the decline to unusually high temperatures and decreased consumer spending. The cannabis sector faces challenges such as reduced prices, increased operational costs, and heightened competition.



Trulieve Faces Decline in Q2 Revenue Amidst Rising Operational Costs

Trulieve Cannabis (TRUL.CD) announced a broader loss for the second quarter. The company highlighted that the unusually high temperatures and a decrease in consumer spending were negatively impacting the performance for the current quarter. The cannabis industry is currently grappling with challenges such as declining prices, rising input costs, a tight labor market, and growing competition.

And Tilray is counting on craft beer

The company’s executives, during a post-earnings call, mentioned that the extreme heat primarily affected cannabis sales due to reduced store traffic, as consumers preferred to stay indoors. Eric Des Lauriers, a Senior Research Analyst at Craig-Hallum Capital Group, supported this observation, stating that extreme heat typically leads to decreased store visits.

For the reported quarter, Trulieve’s revenue saw a 10% decline, amounting to $282 million compared to the previous year. In contrast, the operating expenses surged by 205%, reaching $433 million. However, the company noted a sequential increase in its retail revenue (excluding deferred revenue) by $3 million, which was driven by increased store traffic and volume.

And Verano seeing green

Like many of its industry peers, Trulieve has implemented various cost-saving measures. The company announced its plans to reduce inventory and conserve cash by cutting wages and eliminating redundancies throughout 2023.

For the quarter ending June 30, Trulieve reported a loss of $404 million or $1.8 per share. This is a significant increase from the previous year’s loss of $22 million or 9 cents per share.

[Source: Reuters]

Another company is facing problems

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Marijuana rescheduling leaves regulators and sellers cautiously optimistic

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A move by the Biden Administration to change how marijuana is treated by federal authorities was met with cautious approval by Massachusetts state regulators, cannabis sellers, and national marijuana advocates alike.

The Drug Enforcement Agency will drop marijuana from the list of banned substances found under Schedule I of the Controlled Substances Act, where it currently sits alongside heroin and LSD. It will instead move it to Schedule III, among the likes of Tylenol with codeine and anabolic steroids. This follows the recommendation of the Department of Health and Human Services

“Rescheduling cannabis is a monumental step forward for the federal government, one that can open new avenues to research, medical use, and banking for the regulated industries states like Massachusetts have built across the country,” said Ava Callender Concepcion, the acting chair of the Bay State’s Cannabis Control Commission.

Read the rest of this story on BostonHerald.com.



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Thailand Considers Relisting Cannabis as a Narcotic

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The Thai government is contemplating the relisting of cannabis as a narcotic due to concerns over its recreational use and potential societal harms. This reconsideration comes after cannabis was decriminalized in June 2022, which led to a surge in its availability and use.

Cannabis Conundrum: Thailand Reconsiders Legal Status Amidst Rising Concerns

The recent decriminalization of cannabis in Thailand has ignited a complex debate over its legal status and societal impact. While the policy aimed to boost the medical marijuana industry and provide economic opportunities, the unintended rise in recreational use has sparked discussions about a potential reclassification.

Public Health Minister Anutin Charnvirakul, a key advocate for the decriminalization, emphasized that the policy was intended to promote medical use, not recreational. However, the current legal framework lacks clear regulations governing recreational use, leading to widespread availability and potential misuse.

The Bhumjaithai Party, led by Anutin, initially pushed for the delisting of cannabis to benefit the medical industry and provide economic opportunities for Thai citizens. However, the subsequent surge in recreational use, particularly among youths, has raised concerns about potential health and social consequences.

Opposition parties have criticized the government for inadequate regulations and are advocating for cannabis to be relisted as a narcotic under the Narcotics Act. They argue that the current situation exposes young people to potential harm and lacks sufficient safeguards.

A recent poll revealed that a majority of Thais support stricter regulations on cannabis use. Concerns have been raised about the potential impact on public health, particularly regarding mental health issues and addiction, especially among youths. Additionally, there are worries about the potential for increased crime and social disorder.

The government now faces the challenge of balancing the economic benefits of a burgeoning cannabis industry with the need to protect public health and safety. Finding a solution that addresses the concerns of both advocates and critics will be crucial in determining the future of cannabis in Thailand

Why It Matters

Thailand’s shift in cannabis policy has garnered international attention, serving as a case study for the complexities of drug policy reform. The potential reclassification of cannabis underscores the challenges of balancing economic opportunities with public health and safety considerations. The outcome of this debate will have significant implications for Thailand’s legal landscape, public health policies, and the future of its cannabis industry.

Potential Implications of Relisting Cannabis as a Narcotic

If cannabis is relisted as a narcotic, it could lead to stricter regulations on its cultivation, distribution, and use. This may impact the growth of the medical marijuana industry and limit access for patients who rely on cannabis for therapeutic purposes. Additionally, it could result in increased criminal penalties for possession and use, potentially leading to a rise in incarceration rates.

Alternatively, if the government opts to maintain the decriminalized status, it will need to implement robust regulations and public health campaigns to mitigate the risks associated with recreational use. This includes age restrictions, educational initiatives, and support systems for individuals struggling with cannabis dependence.

The Bigger Picture

The debate surrounding cannabis legalization and regulation is a global phenomenon, with countries around the world grappling with similar challenges. The Thai government’s decision regarding cannabis will likely be influenced by international trends and best practices in drug policy reform. It is crucial to consider the experiences of other nations that have legalized or decriminalized cannabis, examining both the successes and challenges they have encountered.

Source: Thai PBS World



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“A big deal”: What the feds’ move to reclassify marijuana means for Colorado cannabis

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Cannabis advocates in Colorado cheered the Biden Administration’s reported move to reclassify marijuana and said the decision likely would reduce businesses’ tax burden significantly.

Industry leaders cautioned that such a move — if finalized — would not resolve some major challenges facing the industry, such as limited access to banking. But they pointed to the symbolic importance of preparations by the U.S. Drug Enforcement Administration to downgrade the substance’s drug classification.

A man pours cannabis into rolling papers as he prepares to roll a joint the Mile High 420 Festival in Civic Center Park in Denver, April 20, 2024. (Photo by Kevin Mohatt/Special to The Denver Post)

Read the rest of this story on DenverPost.com.



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