EDMONTON, Alberta, April 29, 2026 (GLOBE NEWSWIRE) -- SNDL Inc. (NASDAQ: SNDL, CSE: SNDL) ("SNDL" or the "Company") reported its financial and operational results for the first quarter ended March 31, 2026. All financial information in this press release is reported in millions of Canadian dollars unless otherwise indicated.
SNDL has also posted a supplemental investor presentation on its website, found at https://sndl.com.
The Company will hold a conference call and webcast presentation at 10:00 a.m. EDT (8:00 a.m. MDT) on Wednesday, April 29, 2026. The conference call details can be found below.
MANAGEMENT HIGHLIGHTS
-- Net revenue for the first quarter of 2026 was $195.9 million,
representing a -4.4% decrease compared with the same period of the prior
year, driven by market headwinds in both Liquor and Cannabis segments.
-- Gross profit of $52.8 million for the first quarter of 2026, represents a
decline of $(3.8) million, or -6.8%, compared to the same period of the
prior year, driven by lower revenue across all segments and inventory
adjustments and one-time costs in Cannabis Operations.
-- Gross margin (1) of 27.0% in the first quarter of 2026 represents a
reduction of -0.7% compared to the same period of the prior year, driven
by Cannabis Operations, partially offset by margin expansion in both
Liquor and Cannabis Retail segments.
-- Operating Loss of $(9.1) million for the first quarter of 2026,
representing an improvement of $2.9 million compared to the same period
of the prior year, driven by the absence of prior-year equity-accounted
investees valuation reductions and restructuring-related charges, which
more than offset the decline in gross profit. Excluding
restructuring-related charges, Adjusted Operating Loss totaled $(8.9)
million in the first quarter of 2026, a $0.1 million improvement compared
with the same period of the prior year.
-- Cash flow was negative by $(26.7) million in the first quarter of 2026,
partly driven by cash outflows of $9.6 million related to share
repurchases, $6.6 million associated with changes in long--term
investments, and a $2.9 million payment for the acquisition of five Cost
Cannabis retail stores.
-- Free cash flow (1) was negative $(7.6) million in the first quarter of
2026, driven by income statement losses and inventory build-ups within
Cannabis Operations.
"Beyond the normal seasonality that impacts the first quarter each year, Q1 2026 was particularly challenging, driven primarily by market softness across our business segments and operating territories," said Zach George, Chief Executive Officer of SNDL. "While remaining focused on our strategic priorities and anticipating an improvement in the cannabis market in the second half of the year, we are not standing still. We are proactively adjusting our commercial execution and cost structure to reflect the reality of current market conditions."
Some of the initiatives advanced during the first quarter include:
-- Jeeter Contract: Ahead of the official April 2026 launch, SNDL assumed
exclusive Canadian production and commercialization of Jeeter, a leading
U.S. cannabis brand, enhancing its positioning in the premium pre-roll
category.
-- Profit-enhancement initiatives: In parallel with adjustments to
commercial execution to mitigate softer market demand, the Company is
deploying several initiatives expected to contribute approximately $20
million of incremental operating income over the remainder of the year.
-- SunStream restructuring progress: As U.S. cannabis rescheduling gains
momentum, the restructuring of the Parallel and Skymint investments
continues to advance toward completion, with only a limited number of
remaining requirements outstanding.
-- Share buybacks: During the first quarter of 2026, the Company repurchased
4.5 million common shares for cancellation, bringing the total numbers of
shares repurchased since the fourth quarter of 2024 to 15.1 million.
"With $213.4 million of unrestricted cash and no debt as of March 31, 2026, and exposure across the Canadian, U.S., and European markets, we are uniquely positioned to deploy capital across both organic and inorganic opportunities to further enhance our portfolio and accelerate growth. We are confident that, as current market conditions continue to challenge existing operators, attractive opportunities may emerge in the short to mid--term. More than ever, disciplined capital allocation remains a key priority for our management team, alongside continued execution on efficiency initiatives and profit--enhancement actions," concluded Zach George.
TOTAL COMPANY HIGHLIGHTS
Three months ended March 31
($000s) 2026 2025 % Change
----------------------------- --------- --- ------- --------
IFRS Financial Measures
-----------------------------
Net revenue 195,906 204,914 -4.4%
Gross profit 52,812 56,641 -6.8%
Operating income (loss) (9,114) (12,053) 24.4%
Change in cash and cash
equivalents (26,697) 2,508 -1164.5%
Non-IFRS Financial
Measures(1)
-----------------------------
Gross margin 27.0% 27.6% -0.7 pp
Adjusted operating income
(loss) (8,942) (9,031) 1.0%
Free cash flow (7,591) (1,090) -596.4%
(1) Gross Margin is a supplementary financial measure calculated by dividing Gross Profit by Net Revenue. Adjusted operating income (loss) and Free Cash Flow are specified financial measures that do not have a standardized meanings prescribed by IFRS and therefore may not be comparable to similar measures reported by other companies. See "Non-IFRS Measures" section below for further information.
BUSINESS SEGMENT HIGHLIGHTS
SNDL operates and reports its business through four segments: Liquor Retail, Cannabis Retail, Cannabis Operations, and Investments. Additionally, a consolidated total for Cannabis is presented, encompassing the combined results of the two Cannabis segments, along with the revenue elimination associated with the Cannabis Operations sales to the provincial boards that are expected to be subsequently repurchased by the Company's licensed retail subsidiaries for resale. Corporate and shared service expenses are reported as "Corporate".
Three months ended March 31
($000s) 2026 2025(2) % Change
-------------------------- ---------- -------- --------
Net Revenue
--------------------------
Cannabis Retail 77,345 77,540 -0.3%
Cannabis Operations 29,432 34,319 -14.2%
Intersegment Eliminations (14,954) (16,417) 8.9%
--------------------------- --------- -------- --------
Total Cannabis 91,823 95,442 -3.8%
Liquor Retail 104,083 109,472 -4.9%
Investments -- -- 0.0%
--------------------------- --------- -------- --------
Total 195,906 204,914 -4.4%
Operating Income
--------------------------
Cannabis Retail 1,116 1,327 -15.9%
Cannabis Operations (6,942) (6,171) -12.5%
--------------------------- --------- -------- --------
Total Cannabis (5,826) (4,844) -20.3%
Liquor Retail (3,160) (2,417) -30.7%
Investments 2,038 (1,601) 227.3%
Corporate (2,166) (3,191) 32.1%
--------------------------- --------- -------- --------
Total (9,114) (12,053) 24.4%
Adjusted Operating Income
--------------------------
Cannabis Retail 1,116 1,327 -15.9%
Cannabis Operations (6,942) (3,276) -111.9%
--------------------------- --------- -------- --------
Total Cannabis (5,826) (1,949) -198.9%
Liquor Retail (3,160) (2,417) -30.7%
Investments 2,038 (1,601) 227.3%
Corporate (1,994) (3,064) 34.9%
--------------------------- --------- -------- --------
Total (8,942) (9,031) 1.0%
(2) In 2026, the Company began allocating applicable direct and indirect overhead costs from the corporate segment to each individual operating segment all categorized within general and administrative expenses. The Company has recast the comparative period to illustrate the impact of these allocations had they been done during the prior period, as documented in the condensed interim Financial Statements.
Liquor Retail
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