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Having weathered an industrywide downturn in sales that began during the third quarter of 2021, cannabis-payments processor POSaBIT Systems Corp. late Thursday reported strong first-quarter sales and revenue. Transactions totaled $103 million, a 61% increase from the same period last year, and revenues totaled $6.4 million, up 79%. Same-store sales at its top 20 locations increased volume by 11% during the quarter, compared to the same period a year ago.
In addition to the increases in transaction volume and revenues, POSaBIT chief executive Ryan Hamlin told analysts that since May 3rd, nearly half of the more than 100 new cannabis stores the company had contracted to onboard over the next 60 days have gone live on POSaBIT’s platform and represent an estimated $50 million in annual transactional sales volume.
“By the end of [the second quarter], we expect to stand up the remainder of those 100-plus retail locations,” Hamlin told analysts during an earnings call. “We are well on our way to achieving our commitment of 100 locations live in 60 days.”
Just as important, Hamlin added, is that since early May the Kirkland, Wash.-based processor has increased its funnel of new contracted stores by approximately 20%, adding nearly 30 store locations that it expects to go live over the next 75 days.
POSaBIT’s gains come at a time when industrywide cannabis sales have been slumping, leading to lower average order sizes. The causes, Hamlin speculated, included the loss of government-subsidized checks, as well as a significant reduction in cannabis consumption industrywide. “So, the market dynamics are clearly one factor in the current slowdown,” Hamlin said.
Nevertheless, Hamlin says POSaBIT is encouraged by improving market conditions and the speed at which it teams are onboarding new retail locations. The company is on pace to install more than 50 new stores in May and even more in June, Hamlin says. POSaBIT has more than 450 cannabis stores on its platform.
In addition to the first-quarter gains, POSaBIT announced Julie Solomon as the company’s new chief revenue officer. Solomon joins POSaBIT from Synctera Inc., a fintech banking provider, where she served as the company’s CRO. At POSaBIT, Solomon will lead sales, marketing and customer support teams.
POSaBIT, which in 2021 struck a deal with online-ordering platform provider I Heart Jane to add payments, offers several payment options to cannabis merchants, including POSaBIT ACH, which allows customers to log in and store their banking information within POSaBIT’s payments portal for in-store and online payments. The processor also offers a debit point-of-banking option that acts as a cashless ATM at the point of sale.
