Despite COVID-19 pandemic, local cannabis company seeing plenty of growth

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While many businesses have laid off staff during the COVID-19 pandemic, one local cannabis company is in a period of growth.

Delta 9 has increased their staffing by 76 since March 26 while also in turn raising the hourly wage for those on their frontlines. Stats Canada’s Labour Force report showed an increase of unemployment of from 5% to 11.4% in Manitoba for the month of March.

“We consider ourselves very fortunate to be an employer that is adding jobs right now in light of the economic and health crisis,” said John Arbuthnot, CEO of Delta 9.

Delta 9 released its first quarter financials on Thursday night and showed a growth in revenue from the final quarter of 2019 from $5 million in revenue to $5.8 million. It is a period when retailers usually see a drop off coming out of the holiday season.

Delta 9 CEO John Arbuthnot stands in his company’s second retail store. Delta 9 is looking to expand by 12 retail stores in the next two years. Chris Procaylo/Winnipeg Sun files Chris Procaylo / Winnipeg Sun

The numbers were even more impressive considering the pandemic.

Arbuthnot said foot traffic in stores has remained stead through the lockdowns while they have also had an increase in sales online, aided by being considered an essential service by the province.

The pandemic also created some additional staffing issues. Though they did not have any employees test positive, they have had several be tested while others had to self-isolate after returning home from interprovincial and international travel and others have had to take time off for other COVID related reasons whether it is vulnerability or taking care of children at home. To accommodate, Delta 9 extended flexible sick time and ensured their employees had access to government funding.

This also precipitated some of the hiring done to meet demands.

A staff member wipes down the saloon-style doors at the entrance to the Delta 9 cannabis store on Dakota Street in St. Vital on Monday, March 23. Kevin King/Winnipeg Sun/Postmedia Network Kevin King / Winnipeg Sun/Postmedia Network

Delta 9 also made the decision to give their frontline employees a $2 an hour temporary raise during the pandemic as an acknowledgement of the risks they are taking.

“As a company that is just now reaching profitability, to consider wage increases that are quite substantial was a reach for us but at the same time I think was very important through the crisis to make sure we were doing everything that we could,” said Arbuthnot.

Not all cannabis companies have had the same recent success as Delta 9 of late. There has been an increase in insolvency filings by cannabis companies in Canada since the beginning of December. Even one of the big names in the industry continues to rack up losses as Aurora Cannabis out of Alberta reported a $137.4 million loss in the third quarter, following $1.3 billion loss the previous three months.

Delta 9, meanwhile is looking at expanding by 12 retail shops in the next two years and have received approval from Health Canada for its new purpose-built cannabis processing centre which will allow for fully automated bottling, packaging, capping and labelling of its consumer-packaged dried cannabis products. Arbuthnot said the centre will be able to process up to 25,000 kilograms per year of dried cannabis flower material.

“We’ve taken a very incremental approach to our growth, a more methodical approach,” he said. “To reach that point of profitability before our competitors is a huge benefit for us.”

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