Planet 13 Holdings Inc (NASDAQ:PLTH) Q1 2020 Earnings Conference Call - Final Transcript

Jun 01, 2020 • 05:00 pm ET

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Planet 13 Holdings Inc (NASDAQ:PLTH) Q1 2020 Earnings Conference Call - Final Transcript

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Executive
Larry Scheffler

responsible for 10.1% of total Nevada retail cannabis sales in the first quarter, our highest ever. In February, we're steadily taking share from our competitors and reached 10.9% of the Nevada cannabis sales, our highest single month and prior to entering COVID on the back half of March, we were headed for another record month.

Since March, we've increased our average daily sales from $10,000 pre-COVID to over $100,000 per day as of the end of April while shifting to serving only local customers with a complete elimination of tourist traffic in Las Vegas. We've implemented the same-day ordering throughout the Las Vegas Valley and improved our customer experience week-over-week through April and the beginning of May. While that doesn't go all the way to replacing the $200,000 per day we were generating at our peak pre-COVID, it's a fantastic result, that we're already seeing signs of a gradual return to normalized activity.

On May 1, the state implemented curbside pickup, then on the 9th, dispensaries were allowed to have 10 people in the store. And this week, we're seeing some casinos start to reopen. This is a positive sign for the SuperStore, which is really designed to drive consistently high traffic while offering the best cannabis-related experience anywhere in Nevada, in our view, the U.S. In short term, the reopenings have increased competition statewide as smaller dispensaries that couldn't handle logistical problems associated with deliveries when they were allowed to reopen, often offering extremely discounted products. However, despite this competition, I'm proud to say that we've been able to keep that $100,000 per day run rate and actually increase it even with the stiffer competition and rules that disproportionately hurt the SuperStore.

To put it in context, only allowing 10 people to enter the footprint as large as that of the SuperStore, which means more than 1,000 feet between customers. Needless to say, we don't think restrictions such as this will last very long. We expect a more proportional social distancing model like we've seen in other jurisdictions to ultimately prevail. Planet 13 was designed to drive tourist traffic based on a premium experience with corresponding margins. We've successfully proven our ability to win customers in an environment where the SuperStore's largest strengths, location and experience, are completely removed and turned into disadvantages. Customers are choosing Planet 13 daily [Phonetic] for our product selection and customer service. And these are aspects that will put us on an even stronger footing moving forward. Not only have we been able to win new customers, we've kept them. We are seeing multiple business and a strong retention rate for our delivery service, with 40% of our customers choosing delivery today. I'll let Bob talk a little bit more about Santa Ana, but I'd just say that our experience with delivery will definitely be very useful in California when we open.

With that, I'll pass it off to Dennis to discuss our financials.

Executive
Dennis Logan

Thanks, Larry. Before I begin, I'll just remind everyone that