After 4 Years of Legalization, Alberta Finally Makes a Profit on Cannabis

Alberta Gaming Liquor and Cannabis has finally broken into profitable territory and has projected a $7 million profit, breaking expectations that it would post an $11 million loss for the year. The AGLC has said part of the increase can be explained by low wholesale product prices which were passed on to consumers, who have been enjoying a very low price for their cannabis until now.

Four years after cannabis legalization, the Alberta Gaming Liquor and Cannabis (AGLC), which supplies the province with cannabis, is expected to make a $7 million profit on cannabis, according to the 2022-23 provincial budget.

This is perhaps the first sign that Canada’s cannabis industry, which was initially over-hyped, might finally have some brighter days ahead. Follow this closely and receive regular updates through our free cannabis news app.

Up to $18 Million Change in Revenue for Alberta Gaming Liquor and Cannabis

This could represent an C$18 million change in revenue from a projected C$11 million loss for the fiscal year ending March 31, according to the government of Alberta.

The announcement comes as the AGLC prepares to shut down its retail cannabis website on March 8, relinquishing its monopoly on legal online cannabis sales in Alberta, which accounted for about 1.5 percent of the legal Alberta market.

At the same time, the Alberta government’s tax revenue from private cannabis sales is expected to rise from a projected $145 million in the current fiscal year to $157 million in 2022-23, an 8% increase.

In comparison, this $157 million is well over double the $73 million expected from tourism tax in Alberta but is far less than the $644 million in tobacco and smoking tobacco taxes projected for the coming year.

The AGLC and at least one other cannabis retailer in Alberta said part of the projected increase in revenue can be explained by a new 6 percent wholesale product price increase that went into effect Friday and will be passed on to consumers, who have been enjoying a very low price for their cannabis until now.

“Arguably, Alberta has the cheapest cannabis in the country, and it will always be cheaper than British Columbia, Manitoba and certainly Quebec,” Ryan Roch, owner of Lake City Cannabis, told the Calgary Herald. He said the tax will add about $1 to a pack of pre-rolled.

A Growing Industry in Alberta Since Legalization

“Net cannabis revenue is expected to remain strong in 2022-23 and includes the implementation of the wholesale markup,” said Alberta Gaming Liquor and Cannabis. “The cannabis industry has continued to grow revenues since legalization, with product lines expanding and retailers growing.”

The growing number of cannabis stores in Alberta – which has now licensed 752 outlets, half the number of liquor stores in Alberta – is playing a big role in cannabis access. At the same time, the number of cannabis users has not increased significantly over the past four years.

Federal regulations limiting the THC content of edibles and concentrates also favor illicit sellers.

According to Statistics Canada, cannabis sales in Alberta last December were up 3% over the previous year.

While some businesses in Alberta were closed or severely restricted during the waves of the COVID-19 pandemic, cannabis and alcohol stores were considered essential services and allowed to operate almost normally.

__

(Photo by Stephen Dawson on Unsplash)

DISCLAIMER: This article was written by a third-party contributor and does not reflect the opinion of Hemp.im, its management, staff, or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in NewsWeed, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Hemp.im assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Hemp.im is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.

Avatar Michael Jermaine Cards 300x300

Michael Jermaine Cards is a business executive and a financial journalist, with a focus on IT, innovation and transportation, as well as crypto and AI. He writes about robotics, automation, deep learning, multimodal transit, among others. He updates his readers on the latest market developments, tech and CBD stocks, and even the commodities industry. He does management consulting parallel to his writing, and has been based in Singapore for the past 15 years.

Source link

You May Also Like