CordovaCann says Star Buds stores continue to ‘perform well’ in 2023

CordovaCann provides an update on its Star Buds Cannabis Co. retail operations in Canada. Star Buds Cannabis Co. stores continue to perform well in 2023 despite a difficult environment for the retail cannabis industry. The Company currently has 11 operational Star Buds Cannabis Co. retail stores through its subsidiaries, 2734158 Ontario Inc. and 10062771 Manitoba Ltd., which continue to increase market share and expand margins due to strong cost controls, diverse product assortment and excellent customer service. Management has further optimized the retail platform by closing its 3 non-performing stores in its wholly-owned subsidiary, Cordova Investments Canada, Inc., resulting in lower overhead and compliance costs, and stronger overall cash flow. The Star Buds Cannabis Co. chain generated revenues in excess of $1.1 million in each of the past three months, nearing record monthly revenues with three fewer stores on the retail platform. The stores grew revenues an average of 11.5% each month of this period, in comparison to the same months of the prior year. In July, the chain produced revenues of $1.22 million, with 3 stores posting monthly revenue records. Gross margin has improved throughout 2023, and the stores posted an aggregate gross margin of 27.6% in July. Strong revenue growth trends have continued into August, which should aid in further increasing gross margin. Management expects Star Buds Cannabis Co. to continue to benefit from closures of competing stores, industry consolidation, and increased customer awareness. The Company is also planning to expand the Star Buds Cannabis Co. platform across Canada through both organic store growth and acquisitions at the appropriate time.