Planet 13 Holdings Inc (NASDAQ:PLTH) Q4 2019 Earnings Conference Call - Final Transcript

Apr 14, 2020 • 05:00 pm ET

Previous

Planet 13 Holdings Inc (NASDAQ:PLTH) Q4 2019 Earnings Conference Call - Final Transcript

Share
Close

Loading Event

Loading Transcript

Presentation
Executive
Dennis Logan

the SuperStore operations will be breakeven or better if the shutdown is extended indefinitely.

I'll quickly run through our Q4 results. In Q4 2019, we generated $16.5 million in revenue, down slightly from Q3 2019, and a year-over-year increase of 99.8% compared to 2018. As a reminder, Q4 is the seasonally slowest time in Las Vegas. Adjusted EBITDA during Q4 was $2.5 million. Adjusted EBITDA decreased sequentially due to slightly lower gross profit along with a slightly higher SG&A.

Gross margin in the quarter was 57%, and it was impacted by the closing of our smaller production facility in October and the open and ramp-up of our new production facility on site and our customer-facing production facility in November. The multiple week shutdown meant that we had less of our own in-house products to sell in the back half of the quarter that impacted our gross margin.

Sales and marketing expense was $1.7 million in the quarter, which remained flat as a percentage of revenue, compared to the prior quarter. We spent $5.4 million on general and administration expenses in the quarter, up 4.9 -- up from $4.9 million last quarter. G&A was elevated due to a $400,000 write-off of bad debt from one of our credit card service providers that we had talked about in the last quarter. We've taken a provision for the entire amount.

We've also prereleased Q1 revenue. Q1 revenue was $16.6 million, that's at March 31, a 20% increase year-over-year. As Larry already talked about, this increase would have been even larger if it wasn't for the mandated shift to delivery only in response to COVID-19. The last two weeks of March, revenue was down substantially as we ramped up our delivery activities and pivoted to focus on online ordering and local home delivery.

So with that, I'll pass the call over to Bob.

Executive
Robert Groesbeck

Thank you, Dennis, and good afternoon, everyone. I'd like to echo Larry's comments earlier, just to give a big shout out to our team. They've done an extraordinary job pivoting from a retail platform to delivery only literally overnight, and I can't say enough about them. And I also want to spend just a moment to thank our local leaders, particularly the Clark County Commission for their help and assistance, and also the greater community for supporting and helping each other through this difficult time.

In addition to ensuring Las Vegas Valley residents have continued access to cannabis, we're also doing our part as a member of the community by donating 2,800 meals per month from our on-site restaurant, Trece, through Clark County Social Services to assist needy seniors throughout the valley. We are also providing our employees with a daily pre-meal during each of their workdays to help them through this difficult time. As a longtime Las Vegas resident, I know that the city takes care of its own, and I know that it remembers those who don't.

So moving on to Santa Ana. As Dennis indicated, and as previously