Cannabis NB blames $2.2M first-quarter loss on illegal dispensaries
Published Tuesday, August 6, 2019 10:27PM ADT
Last Updated Wednesday, August 7, 2019 7:38AM ADT
After losing $11.7 million during its first six months in business, Cannabis NB is reporting a loss of $2.2 million in its first quarter of 2019, and the company is blaming the losses partly on the emergence of many illegal dispensaries.
In a statement, a spokesperson for Cannabis NB says the loss could be due to a couple of factors:
"The emergence of many illegal dispensaries – up to 40 – throughout the province continues to be the biggest risk and threat to a safe, legal cannabis retail industry; and the continuing stabilization of the portfolio and having access to full product offering is improving but still not at our originally anticipated levels."
In May, New Brunswick Finance Minister Ernie Steeves said he was considering three options for Cannabis NB's future, which included having 'experts' running the business, scaling it down and closing underperforming stores, or privatizing it.
However, as of Tuesday, Steeves' office says no decision has been made and won't be until the end of 2019, but first-quarter results will be taken into consideration.
Green Party Leader David Coon says Cannabis NB should still be under NB Liquor's control, but changes should be made.
"The government has built brand new stores, they put a lot of sunk capital cost in it, so the approach they took from the outset was a costly approach and therein lay the problem," says Coon. "So the legislation needs to be amended to create a more streamlined system."
People's Alliance Leader Kris Austin feels differently.
"Privatize it, regulate it, tax it," says Austin. "There's no reason why the taxpayers of New Brunswick should be subsidizing the sale of marijuana."
Cannabis NB says other provinces are reporting losses as well and that the cannabis industry is a brand-new industry that's still "normalizing."
Meanwhile, New Brunswickers will have to wait until the end of 2019 to learn about how their government plans proceed with Cannabis NB.
The province says it's focused on making the best decision for taxpayers.
With files from CTV Atlantic's Laura Brown