NSLC Releases Q3 Financial Performance

Halifax, February 18, 2020 – For the third quarter (September 30 – December 29, 2019), the NSLC experienced moderate growth in earnings primarily due to a 2.8% increase in beverage alcohol sales. Total sales were $185.5 million, an increase of 2.6% when compared to the same time last fiscal year. This growth is due mainly to increased sales of beverage alcohol over the Thanksgiving and Christmas holidays. Cannabis sales for the quarter are stable; however, it is important to note they are not comparable because there were 15 less selling days in the prior year due to the timing of legalization on October 17, 2018.

“The efforts of the team generated solid increases in net income and sales this quarter setting us up nicely to meet our financial commitment this fiscal year,” said Greg Hughes, President & CEO.

The NSLC began offering a limited assortment of cannabis-infused chocolates, soft chews, mints, teas and vape products in all 12 cannabis stores by December 23. “We knew it would be a challenge to launch the second phase of cannabis products heading into our busiest time of year, but our people did it. The entire NSLC team worked hard, serving our customers well over the holidays while introducing new legalized cannabis products,” said Hughes.   

In addition to its steady financial performance, the NSLC continues to make its corporate social responsibility mandate a priority, especially as it relates to responsible sales and consumption. NSLC employees continue to be vigilant with responsible sales, asking for ID an average of 2 million times a year from customers who appear to be under the age of 30. Cabbioke, the NSLC’s campaign designed to create awareness to enjoy the products responsibly, attended Christmas parades from Liverpool to Amherst to Glace Bay with the support of employee volunteers in every community.

The team continues to focus on partnerships with Feed Nova Scotia and Habitat for Humanity, with employee volunteers packaging thousands of kilograms of food and helping to build duplexes for two highly deserving families.

“It’s very important to us to give back to the communities where we live and work. I’m extremely proud of the team for committing their time and energy to these organizations that do such vital work for Nova Scotians,” Hughes said.

Financial Highlights (compared to the same period last year):

• Net income (earnings) totaled $65.5 million; up $0.78M million or 1.2%.
• Total sales were $185.5 million; an increase of $4.67 million or 2.6%, primarily due to beverage alcohol which generated $168 million in sales.
• Cannabis sales were $17.4 million, an increase of 0.1%.
• Retail customer transactions (purchases) for beverage alcohol were up 0.9%, and the average dollar value of each transaction grew by 2.1% to $33.05.
• The total volume of beverage alcohol sold was up 1.2%.
• Retail customer transactions for cannabis were 521,287; with an average dollar value of $33.39 down from $38.05 the previous year.

Sales by Channel

Business Highlights

• Completed renovations to our Whitney Pier store. The Select store features a Cool Zone of chilled products and a selection of some of our best-selling products – as well as a map of Whitney Pier displayed across an entire wall to proudly celebrate the community.
• Issued our first Purchase Orders for the second phase of cannabis products, with products available in all our cannabis stores by December 23.
• Employees participated in two volunteer days at Feed Nova Scotia and a fundraising potluck at Head Office and spent three full days helping to build duplexes for two families through Habitat for Humanity.

Local Product Sales Highlights

The growth in local industry continues to be strong as producers create innovative products and expand their businesses and quality offerings.

• Nova Scotia ready-to-drink products experienced another strong quarter with sales increasing by 79.83% to $3.5 million. This strong growth was driven by vodka coolers and ciders.
• Nova Scotia craft beer sales grew by 26.1% to $5 million. The NSLC now lists products from 29 local breweries, up from five breweries just six years ago. 
• Nova Scotia spirit sales grew by 20.8% to $2.9 million. This category has experienced steady growth over the last couple of years.
• Nova Scotia wine sales grew by 3.8% to $3.6 million.
• Nova Scotia produced cannabis accounted for 19.9% of cannabis sales this quarter.
• The NSLC is proud to support local producers across all product categories as they continue to innovate and offer high quality products.

Operating Expense Ratio

The NSLC’s operating expense ratio for the quarter, including amortization and depreciation, was 16.7 % compared to 16.3% reported the prior year.

Board Expenses

The NSLC released the Board of Directors’ expenses for the third quarter. These expenses amounted to $3.60 per Director, per day. An electronic version of these expenses is available HERE.

About the NSLC

The NSLC manages the safe and responsible sale of beverage alcohol and recreational cannabis in Nova Scotia, returning 100% of its profits to government to help fund key public services. As a true partner in our communities, the NSLC conducts its business with integrity and respect for the environment, while supporting the growth of local industry. For more information about the NSLC, please click here. 

For more information please contact:

Beverley Ware

Communications Advisor

beverley.ware@myNSLC.com

O: (902) 450-5920

M: (902) 456-5040