- Cannabis company, YSS Corp (TSXV:YSS) has released 2019 fourth quarter and year end financial results, and 2020’s first quarter outlook
- As the first full calendar of cannabis legalisation in Canada, 2019 was a year of strong foundation building for YSS
- The COVID-19 pandemic has caused various disruptions for the industry, but also resulted in opportunities for increased 2020 revenue
- Looking to the future, YSS is advancing plans for new store locations, and awaiting new authorisations
- YSS’s share price is down 21.87 per cent, currently trading for 12 cents per share with a market cap of C$13 million
Cannabis company, YSS Corp (TSXV:YSS) has released 2019 fourth quarter and year end financial results, and 2020’s first quarter outlook.
As the first full calendar of cannabis legalisation in Canada, 2019 was a year of strong foundation building for YSS. In that time, the company went from zero to fourteen operating stores, and made three acquisitions.
YSS reportedly achieved C$3,652,000 in revenue for 2019’s fourth quarter. The company considers 2019’s fourth quarter as a corporate baseline period for future results. For the full year, revenue was approximately $8,541,000.
As of December 31, 2019, the company had approximately $6.4 million in cash on hand, with no debt obligations. YSS also reported a pleasing reduction in the average cost of organic store build-outs. Its six most recent stores cost roughly $379,000, a 27 per cent decrease from the company’s first six constructed stores.
YSS President and CEO, Theo Zunich, expressed his pride in the company’s performance and accomplishments in 2019.
“The Canadian cannabis industry continues to offer attractive growth potential, and we are positioning the company to capture that growth.
“In 2019, we developed a sound foundation, highlighted by strides made in Q1 2020. We continue to build on that foundation during the rest of the year, with the objective of exiting 2020 with a positive run-rate EBITDA,” Theo said.
Since the start of 2020, YSS has opened three additional store locations, bringing its total to 17. The company has also benefitted from the introduction of cannabis edibles and vaporiser products.
YSS’s forecast revenue for 2020’s first quarter is approximately $4.2 million. This would be a 15 per cent increase on 2019’s successful fourth quarter.
One of the most significant and unexpected factors to impact the cannabis industry recently is, of course, the COVID-19 pandemic. The health crisis, and subsequent prevention measures, have certainly created an unprecedented operating environment.
Cannabis retail has been deemed an essential service in many parts of Canada, allowing stores to remain open during mass shutdowns. In Alberta and Saskatchewan, YSS and its Sweet Tea brands stores are open, albeit with reduced opening hours.
Despite the disruptions, many cannabis companies have reported increased sales revenue and order sizes during the pandemic. In order to capitalise on this opportunity, YSS will be launching its click-and-collect platform in the coming days.
Looking to the future, the company is advancing its plans for expansion across Canada. In Alberta, YSS is working to commence construction on two new store locations, in Calgary and Edmonton.
In Ontario, the company has received its Retail Operator License from the Alcohol and Gaming Commission of Ontario (AGCO). YSS has also applied for a Retail Store Authorisation (RSA) for its location in Waterloo. However, this will take time, due to restrictions on non-essential construction, and a temporary pause on issuing new RSA’s.
YSS’s share price is down 21.87 per cent, and trading for 12 cents per share, as of 9:34am EST.