VANCOUVER, BC – C21 Investments Inc., a vertically integrated cannabis company, filed its audited financial statements and management discussion and analysis for its fourth quarter and fiscal year ending March 31, 2025, on SEDAR. The Company’s financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). All currency is reported in U.S. dollars. The Company recently changed its fiscal reporting period to a March 31st year-end. With this change, the comparative period in the audited financial statements will not reflect the same calendar months.
Fourth Quarter Highlights (January 1, 2025 to March 31, 2025)
- Revenue of $8.1 million – up 3% from Q3 – driven by same store sales growth across all dispensaries; State of Nevada sales were down 6.5% from the sequential comparative period; Compared to the previously reported Q4 (ended Jan. 31, 2024), revenue grew by 24%
- Gross Margin of 45% – relatively flat from Q3
- Income from Operations of $0.8 million – down $0.1 million from Q3 due to one-time SG&A costs
- Earnings (Loss) Per Share of ($0.01) – down from Q3’s ($0.00), primarily due to income tax adjustments; Net Income Before Tax of $0.7 million
- Adjusted EBITDA of $1.7 million – up 8% quarter-over-quarter and up 60% over the previous Q4
- Free Cash Flow before working capital changes and taxes of $1.6 million – flat from Q3
- Purchased and cancelled over 2 million shares (see news release dated February 19, 2025)
Fiscal Year Highlights (April 1, 2024 to March 31, 2025)
- Revenue of $30.1 million – up 6.5% over the previously reported fiscal year (ended January 31, 2024)
- Gross Margin of 42% – up 230 basis points from the previous year despite one-time costs in Q1 associated with opening the South Reno store
- Income from Operations of $1.3 million, driven by an 11% operating margin in the second half of the fiscal year, partially offset by one-time costs in Q1
- Earnings (Loss) Per Share of ($0.03), primarily driven by income taxes and one-time costs opening the South Reno dispensary; Net Income Before Tax of $0.4 million
- Adjusted EBITDA of $4.9 million – up 7% over the prior fiscal year
- Free Cash Flow before working capital changes and taxes of $4.0 million – up 41% from the prior fiscal year
- Customer Transactions increased 38% over the fiscal year, from 126,449 in Q1 to 174,611 in Q4
Q4 and Fiscal Year End Management and Operational Commentary
CEO and President, Sonny Newman: “I’m excited to share our strong results this quarter, a typically slow period for the industry, which showcases the hard work we’ve put into driving continued organic, same-store sales growth. We have seen fourth quarter sales surge by 24% over the previous Q4, fueled by a 38% increase in customer transactions over the year. Despite the 6.5% sequential decline in Nevada state sales, our Q4 revenue grew 3% quarter-over-quarter. Our South Reno store has now delivered over 100% same-store sales growth from its first full operational month in July 2024 to March 2025. Despite industry-wide price compression, we have witnessed a 26% retail sales increase from Q1 to Q4, which has significantly improved margins. The Company’s disciplined approach to growth has allowed us to achieve another year of sustained free cash flow. Our consistently strong results are a testament to C21’s unique model and incredible team. We remain committed to actively pursuing additional accretive opportunities while maintaining our relentless focus on driving shareholder value.”
Given the previously reported change in fiscal year end from January 31 to March 31, it is important to note that there is no equivalent time period to this Q4 report in the Company’s historical results.
Q4 revenue of $8.1 million was up 3% from Q3, despite the 6.5% decline in Nevada sales over the comparative period. The increase in retail sales was driven by same store sales growth in each of Silver State’s three dispensaries. The South Reno dispensary continues ramping its sales with exceptional performance, with monthly sales of $580,000 in March, up from $273,000 in July, achieving over 100% same store sales growth since its first operational month. For the fiscal year, Revenue was $30.1 million, with 26% retail sales growth reported from Q1 to Q4.
Gross Margin of 45% in the fourth quarter was relatively flat from Q3. For the year, Gross Margin was 42% and improved 230 basis points from the previous fiscal year (ended January 31, 2024). The improvement was driven by increased retail revenues, and greater operational synergies and cost efficiencies associated with integrating the new dispensary, partially offset by one-time costs in Q1 associated with opening the South Reno store.
C21 reported Income from Operations of $0.8 million in the fourth quarter. This continued strong operating margin was driven by the increase in retail sales while slightly offset by one-time costs in the period related to the refiling of income taxes for the previous three years. For the year, Income from Operations was $1.3 million, driven by an 11% operating margin in the second half of the year, and partially offset by one-time costs in Q1 associated with the new dispensary.
The Company reported a Net Loss of $1.6 million in the fourth quarter, or ($0.01) per share. Q4’s Net Loss was primarily due to increased Income Tax provisions. The Company generated $0.7 million Net Income Before Tax for Q4. For the year, Net Loss was $4.0 million or ($0.03) per share, impacted by $4.2 million in Income Tax and further by one-time costs in Q1 associated with opening the new dispensary in South Reno. Net Income Before Tax for the year was $0.4 million.
Q4 Adjusted EBITDA was $1.7 million, up 8% from Q3. The increase in Adjusted EBITDA was driven by the improved retail sales for the quarter. For the year, Adjusted EBITDA was $4.9 million, up 7% from the previous fiscal year (ended January 31, 2024).
Q4 Free Cash Flow before working capital changes was $1.6 million, flat from Q3. For the year, Free Cash Flow before working capital changes was $4.0 million, up 41% over the previous fiscal year (ended January 31, 2024).
Cash at the end of Q4 was up $0.1 million from Q3 notwithstanding $0.8 million in Income Tax paid, a $0.3 million debenture principal repayment, and $0.3 million in share repurchases in the quarter. Total Liabilities increased due to the addition of Uncertain Tax Provisions. For the year, Income Tax paid in cash was $1.5 million.
In the fourth quarter, the Company announced the repurchase and cancellation of 2.05 million shares, at an average price of $0.125 per share (see news release dated February 19, 2025). As of June 23, 2025, the Company has 117,862,314 shares outstanding.
Based on legal interpretations and opinions that challenge its tax liability under Section 280E Internal Revenue Code of 1986, the Company has taken the position that it does not owe taxes attributable to the application of this Section of the Code. The Company plans on refiling amended U.S. federal income tax returns for the years ended January 31, 2022, January 31, 2023, January 31, 2024, and the two months ended March 31, 2024. Management exercises significant judgment when assessing the probability of successfully sustaining the Company’s tax filing positions, and in determining whether a contingent tax liability should be recorded and, if so, estimating the amount.
About C21 Investments Inc.
C21 Investments Inc. is a vertically integrated cannabis company that cultivates, processes, and distributes quality cannabis and hemp-derived consumer products in the United States. The Company is focused on value creation through the disciplined acquisition and integration of core retail, manufacturing, and distribution assets in strategic markets, leveraging industry-leading retail revenues with high-growth potential multi-market branded consumer packaged goods. The Company owns Silver State Relief and Silver State Cultivation in Nevada, including legacy Oregon brands Phantom Farms, Hood Oil and Eco Firma Farms. These brands produce and distribute a broad range of THC and CBD products from cannabis flowers, pre-rolls, cannabis oil, vaporizer cartridges and edibles.
