Cannabis earnings season continues apace

NEW YORK, NEW YORK
Board members at CANY step down

What happened: Four board members of the Cannabis Association of New York (CANY), an industry trade group, have stepped down from their roles, Cultivated has learned.

The board members who left include Jason Klimek, Dave Falkowski, Owen Martinetti, and Dan Dolgin. As of Wednesday, their bios had been removed from CANY’s page. 

That leaves three remaining members, including President Damien Cornwell, Nicole N’diaye, and Franklin Henderson. 

What they’re saying: “CANY is deeply thankful for the voluntary work our board members put in day-in and day-out in their demanding roles, and that includes the two long-time members who were reaching the end of their terms and two others who will remain in their roles on the CANY policy committee,” Cornwell said in a statement.  

“The New York market is growing rapidly, and CANY, which started as a growers and processors association, will continue to evolve with it. We look forward to finding the right mix of board members to help us continue to grow into the chamber of commerce for New York’s cannabis industry, where we serve as both a policy mouthpiece for its needs and its most vocal promoter both here in New York and around the world.” 

Why it matters: The whisper campaign in New York cannabis, like pretty much everything in New York, is prodigious.

The truth is, these volunteer board positions take a lot of work. It’s reasonable to leave to focus on your actual money-making business. Klimek and Falkowski are staying associated with CANY in advisory roles, and both Martinetti’s and Dolgin’s terms are set to expire, per sources with knowledge of the moves. 

But many in New York cannabis circles were miffed when CANY sent a letter to the state’s Cannabis Control Board in April warning against issuing more licenses to not oversaturate the market  — something that pretty much everyone in the industry was demanding, besides, well, CANY. 

That set off a tit-for-tat between CANY and the Cannabis Farmers Alliance, which said that issuing new licenses would be crucial for the state’s cannabis farmers to survive as going concerns. 

In July, CANY released a survey indicating that 71% of state cannabis businesses say they expect sales to increase — but 78% of dispensary owners say their suppliers had limited shipments over the past three months. 

The board resignations also come at a tumultuous time for New York cannabis more generally, as the state’s chief regulatory agency, the Office of Cannabis Management, has seen a wave of departures in recent weeks and months. 

-JB

Ed: Updated to reflect that Klimek and Falkowski are staying on in advisory roles.

“You just realize how sometimes it’s these small decisions that we make that can have a huge impact on what type of life we have the opportunity to live. And in many cases, you’re making those decisions before you’re even fully processing how you think about these things,” Maryland Governor Wes Moore said in an interview. “So it was an important moment in my life and an important lesson learned for me too.”

Moore issued over 175,000 state pardons on June 17 for prior cannabis convictions. His decision was in part informed by his own experience with law enforcement, as he said he was caught tagging by NYC police when he was only 11 years old.

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Cannabis second-quarter earnings season continues apace. Let’s get it:

• Curaleaf reported a $49 million net loss on $342 million of revenue, a 1% sequential increase. The company guided $70 million in Capex next year, as they build out capacity in Florida but has lost around $100 million this year. 

• Verano Holdings reported a $22 million net loss on $222 million of revenue. 

• AYR Wellness reported a $39 million net loss on $117 million of revenue. 

• Aurora Cannabis reported a $4.8 million net loss (down from $20 million this quarter last year) on $83.4 million of net revenue, up 12% sequentially.

• MariMed reported a $1.6 million net loss on $40.4 million of revenue. 

• Jushi Holdings reported a $1.9 million net loss on $64.6 million of revenue.

• Cannabis real estate lender AFC Gamma reported a net income of $16.4 million and paid shareholders a 48 cent per-share dividend. 

• NewLake Capital Partners reported $6.8 million in net income on $12.5 million of revenue. 

Up tomorrow, we have Cannabist, Cresco Labs, Cronos Group, and a bunch of others. Our friends at New Cannabis Ventures have you covered for the list. 

We’ll have big takeaways from diving into the statements, earnings calls, and analyst commentary for you all in a future edition. 

New Yorkers still frustrated with OCM 😡

New York’s Office of Cannabis Management (OCM) approved 86 new licenses during a meeting on August 6. But this number is lower than that of both June and July (105 and 109 respectively). New Yorkers, of course, took to X/Twitter to express their anger with the OCM.

What do experts say about rescheduling? 🎓

Expert panelists talked about the impacts of rescheduling cannabis during a webinar hosted by the Ohio State Moritz College of Law’s Drug Enforcement Policy Center. They said rescheduling will do little more than eliminate the 280E tax — which stipulates that companies selling Schedule I controlled substances can’t deduct regular business expenses — for the state-licensed cannabis industry and that it will still be heavily regulated as a Schedule III substance, much like ketamine. Research barriers still exist and may even be intensified, the experts said. And despite robust support for rescheduling during the public comment period, they believe it is unlikely to happen before the end of the year. Watch the recording here. 

Cannabis and sex… an unlikely partnership 🤝

Advocates are pushing to list female orgasmic disorder (FOD) as a qualifying condition for medical cannabis in states like Oregon and Colorado. This proposal follows petitions in multiple states, with Connecticut already adopting it. Supporters argue that cannabis can enhance sexual sensitivity and intimacy, helping individuals with FOD achieve orgasm. Read more. 

Nevada cannabis remains under Schedule 1️⃣

The Nevada Supreme Court ruled that cannabis may remain classified as a Schedule I drug, despite its legalization for medical and recreational use. This decision overturned a 2022 Clark County District Court ruling that deemed the classification unconstitutional. Read more. 

Philippines medical cannabis 🇵🇭

The Philippine House of Representatives passed HB 10439, which would legalize medical cannabis, with a vote of 177 to 9. The bill, the Medical Cannabis Act, now moves to the Senate for further consideration. Read more.

Curaleaf executive chairman and inside-the-Beltway cannabis champion Boris Jordan will take over from Matt Darin as the cannabis firm’s CEO. Darin said he’s retiring to spend time with family, but will stay on as an advisor through the end of the year. 

MariMed has hired Mario Pinho as its new CFO.

Jushi Holdings refinanced a $53 million loan by taking out a new $48.5 million loan with a 12.25% interest rate and using $7.4 million from their own cash. The new loan is due in 30 months, a bit before their existing loans are due in late 2026.

New Jersey Sen. Robert Menendez, who famously stashed gold bars in his house, told Ask-a-Pol that it’s “crazy” that many cannabis companies still can’t bank normally.

Menendez has supported the SAFER Banking Act, a bill that would allow cannabis firms to access the banking system, though he is leaving the Senate on August 20.

‘It’s electric’: Local dispensaries see long lines on first day of recreational marijuana sales | Cleveland.com

‘Very bullish outlook’: Cannabis Control Board approves new licenses as NY market picks up steam | New York Cannabis Insider

Missouri regulators recall 2,600 cannabis products over improper testing | MJBizDaily

Australian farmers hope to capitalise on relaxed cannabis laws in Europe | ABC Australia

First year of legal home grow yields big returns for these medical cannabis patients | MPR News