Planet 13 Holdings Inc. (PLNHF) Q3 2020 Results - Earnings Call Transcript
Planet 13 Holdings Inc. (OTCQX:PLNHF) Q3 2020 Earnings Conference Call November 24, 2020 5:00 PM ET
Company Participants
Mark Kuindersma - Head of IR
Bob Groesbeck - Co-Chairman and Co-CEO
Larry Scheffler - Co-Chairman and Co-CEO
Dennis Logan - CFO
Conference Call Participants
Doug Cooper - Beacon Securities
Bobby Burleson - Canaccord
Greg Gibas - Northland Securities
Scott Fortune - ROTH Capital Partners
Operator
Hi, everyone. Welcome to the Planet 13 Holdings 2020 Third Quarter Financial Results Conference Call. As a reminder, this conference call is being recorded on November 24, 2020. [Operator Instructions]
I will now turn the call over to Mark Kuindersma, Head of Investor Relations for Planet 13.
Mark Kuindersma
Thank you. Good afternoon, everyone, and thanks for joining us today. Planet 13 Holdings' third quarter 2020 financial results were released today. The press release, financial statements and MD&A are available on SEDAR, as well as on our website, planet13holdings.com.
Before I pass the call over to management, we'd like to remind listeners that portion of today's discussions include forward-looking statements. There can be no assurances that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. As a result of these risks and uncertainties, the results or events predicted in these forward-looking statements may differ materially from actual results or events. Risk factors that could affect results are detailed in the company's public filings that are made available on SEDAR, and we encourage listeners to read those statements in conjunction with today's call.
The forward-looking statements in this conference call are made as of the date of this call. Planet 13 disclaims any intention or obligation to update or revise such information except as required by applicable law, and does not assume any liability for disclosure related to any company mentioned herein. Planet 13's financial statements are presented in U.S. dollars and the results discussed during this call are in U.S. dollars, unless otherwise indicated.
On the call today, we have Bob Groesbeck, Co-Chairman and Co-CEO; Larry Scheffler, Co-Chairman and Co-CEO; and Dennis Logan, CFO.
I will now pass the call over to Larry Scheffler, Co-Chairman and Co-CEO of Planet 13 Holdings Inc.
Larry Scheffler
Thanks Mark. Good afternoon, everyone, and thank you for participating in our third quarter call.
Q3 was our best quarter ever, and a demonstration of the resiliency, flexibility and strength of our business model SuperStore and Planet 13 as a whole. Despite the ongoing pandemic, and Las Vegas being at less than 50% tourist occupancy compared to the same period a year ago, we generated 22.8 million in revenue, 36% higher than our highest quarter ever. Once again, we're responsible for 9% of the state's total sales. And this is continuing into Q4, with October posting another month for over 7.5 million in revenue.
This improvement has been driven by operational changes we've made throughout Q2 to adapt to COVID-19. We introduced delivery which contributed 3.3 million in the quarter exclusively from local residents. We improved SuperStore throughput, refined marketing towards locals and tourists, resulting in higher traffic and ticket and 18.5 million of revenue from the SuperStore. We've also launched our brands in the rest of the states our fewer wholesale channel and an additional $1 million of revenue during the first full quarter of the wholesale sales.
The SuperStore performance has given us the competency to continue to build on what is working. On October 13, we announced the addition of non cannabis retail continuing to build out the SuperStore. The non cannabis retail space will sell Planet 13 merchandise and general sundries.
In addition to the non cannabis retail, we're also taking the opportunity to double the dispensary floor and add an additional 40 points of sale in another entertainment feature. We are consistently seeing lines out the door in weekends and wait times in excess of 30 minutes. Expanding the dispensary floor and adding points of sale will increase customer throughput resulting in maximizing sales potential and a better customer experience. These are just a few of the many plans upcoming expansions at SuperStore.
We still have 30,000 square feet of unbuilt space is being held for our cannabis consumption lounge, a nightclub and other retail opportunities. Our focus remains on creating one stop shop convenience for tourists who are looking to enjoy their visit and giving customers more reasons to visit the SuperStore and to stay longer.
On the local front, we recently opened our Medizin dispensary. The Medizin dispensary did 4.9 million in the last quarter it was open. Since then, we've seen strong Nevada market growth and the Allegiant Stadium where the Raiders play, they open a couple blocks away with potential tailgate locations surrounding our dispensary.
Along with Medizin, our deliveries remain strong and is an active part of our expanding our share of the local market. Overall, I'm very, very proud of the way the team responded to the challenges this year. Their hard work, innovation and resilience has helped us return to our position in Nevada with retail sales accounting again for over 9% of the state sales through Q3. With the Medizin opening, we expect to continue to build on that dominance.
With that, I'll pass it up again to discuss our financials.
Dennis Logan
Thanks Larry. Before I begin, just like to remind everyone that the numbers on the call today are in U.S. dollars unless specifically stated otherwise.
As Larry mentioned, Q3 was the best quarter in the company's history across the entire business. The company recorded 22.8 million in total revenue, 3.3 million from delivery and curbside, 18.5 million from the SuperStore and 1 million from the wholesale sales channel. The SuperStore performance despite the limited tourist traffic on the Las Vegas Strip has been tremendous. Delivery and wholesale are essentially new businesses for us. And the quick reception rapid growth of those platforms has been fantastic.
Gross margin during the quarter was 56.9% returning to historical levels, as we reopened the SuperStore during the quarter to in-person sales. We've seen the cost of internal cultivation continue to trend down as we've increased yields and cultivation efficiencies. This momentum was somewhat impacted by the addition of a new cultivation facility during the quarter. But we are already seeing improvements in both yield and cost at the new facility in Q4 2020. And expect to continued improvements as we fully implement all of our cultivation best practices across both locations.
We are seeing also seeing margin enhancement as more revenue is derived from the sale of in house brands in the SuperStore, there's margin enhancement is partially offset from the lower margin revenue coming through the wholesale channel.
Sales and marketing expense during the quarter was 900,000. This was up 200,000 from the prior quarter. Q2 was a low point due to the impact of COVID-19 lockdown. But still, Q3 was still well below the historical levels of approximately 1.2 million in prior quarters.
The company returned to a more balanced sales mix targeting both tourists and locals in the quarter. The company spent 6.2 million on G&A in the quarter, which was up from 5.5 million last quarter. This increase was a result of adding staff and investing in our organization to support the Medizin dispensary, the wholesale fulfillment channel and the planned opening of Santa Ana.
As of September 30, 2020, the company had a cash balance of 56.7 million, an increase from 22.7 million as of June 30, 2020. The cash increase was a result of 3.8 million in positive cash flow from operations, 31 million in financing from closing two bought deals during the quarter. And this was offset by 4.1 million associated with the purchase of assets and other costs capitalized to the cannabis licenses acquired during the period.
Since September 30, the company has closed an additional 28.8 million in Canadian dollar and gross proceeds and saw the exercise and additional 400 - I guess 400 we had more warrants exercise today as the numbers in the 420,000 range, and 100,000 options that brought in an additional 1.67 million in cash.
So as of today, we have approximately U.S. 71 million in cash. And this is after making $7.2 million tax payments on October the 15th. And as a reminder, our current growth plans require about 8 million CapEx for Santa Ana, 2 million for upgrades and additions at the SuperStore that Larry has mentioned, and another 500,000 on improvements at the recently acquired cultivation facility. The rest of the capital we have is earmarked for expansion and issues.
And with that I'll pass the call back over to Bob.
Bob Groesbeck
Thank you, Dennis and good afternoon everyone.
The Q3 has indicated was a fantastic quarter for Planet 13. The SuperStore is performing well. Our expansions are progressing, and our brands continue to gain popularity in the wholesale markets.
As Larry mentioned, in the first full quarter of wholesale, we saw over 1 million in sales. Our HaHa Gummies particularly have been a resounding success, taking multiple spots for the top edible SKUs in Nevada. Encouraged by this, we've expanded our SKU selections with HaHa Beverages, which were introduced in October. And now our HaHa Sour Gummy line, which is being introduced to the SuperStore this week actually, and is expected to be rolled out statewide shortly thereafter.
We've expanded from 20 dispensaries carrying our products to over 40 dispensaries in the state now. More exciting than the new dispensaries carrying our products is the reorders we're seeing coming in from existing clients. It's clear our products are resonating with our customers.
The performance by our team and the results from the wholesale sales really have reaffirmed our decision - confirmed our decision rather to invest and build our in-house production facility and our investment in additional high quality indoor cultivation.
As a reminder, we purchased additional cultivation in July of this year. We expect to finally close that transaction within days. We've ticked off all of the closing conditions and are simply waiting for Clark County to issue a business license.
As part of the terms of the agreement, we immediately took over running the facility and are making a string of upgrades to reconfigure retard needs, and especially for our unique Medizin strains. We are well on our way with those efforts and expect to see high yields from our incredibly popular strains and inner future, allowing us to expand our flower lines.
Overall, in-house products are responsible for about 25% of our sales, which puts us well on our way to reaching the 50% target we've set. In California, our Santa Ana SuperStore is progressing nicely. We are finishing up with the permitting process and expect construction to start in early January, putting us on track for a projected opening in the first half of 2021.
The California market is seeing strong growth over the last couple of quarters as new regulations have helped to shift customers from the illicit market to legal channels. We're excited to see that change. And we're also excited to bring the Planet 13 experience to California and introduce new cannabis connoisseurs to a unique cannabis shopping experience. I think we've also benefited from the crash course we received in cannabis delivery over the last two quarters here in here in Las Vegas. And we think those experiences will bode well as we transition into California.
This has been an incredibly productive year for Planet 13, as I've mentioned. We withstood the greatest possible macro headwinds significantly derisking our business model. We've diversified our Nevada operations by growing local sales with curbside pickup, delivery and now Medizin reopening.
We are building a name for our brands and driving growth through wholesale. We are well on our way to our first out-of-state expansion and are armed for substantial - with a substantial war chest to go about and pursue those additional opportunities.
With that said, I'd again like to thank everybody for participating. And I'd now ask the operator to enter the call and open the lines for questions. Thank you.
Question-and-Answer Session
Operator
[Operator Instructions] Thank you. Our first question comes from Doug Cooper with Beacon Securities. Please proceed with your question.
Doug Cooper
This is a great quarter. Let me start out with the margins, Dennis. EBITDA margin 27.2% versus 20.2% last year, so a 700 basis point improvement. Can you sort of indicate how much of that was due to just increased volume and operating leverage? And how much maybe was due to the vertical integration in your own products?
Dennis Logan
Doug, we've bifurcated it a number of ways, I guess, to get as granular as we can. As we move towards our target 50% of vertical integration, we're about halfway there now. It's hard to say, a good chunk of that margin improvement, probably a little bit over half of it has come from that vertical integration. And then the balance of it is coming from the success of the store and the larger ticket sizes and the return to that tourist customer where we get a higher-margin business. So our curbside, I guess, it's a testament to the fact that we have curbside and home delivery that are targeted to locals. And so those margins are lower, but that lower margin is offset by the higher percentage of in-house products that we're selling through those channels as well. So it's kind of a double whammy on that one.
Doug Cooper
Right, so what do you think if you get to - your in-house products get to 50%, including, I guess, most particularly your own flower - more of your own flower with the new cultivation facility coming on and then obviously, more scale. What do you think EBITDA margin can get to?
Dennis Logan
Without having to continually update that, I mean, we've talked about in the mid- to high 30s as where we think it kind of realistically can get to without a lot of additional costs that we have to spend or CapEx we have to spend. So that's our target.
Doug Cooper
Okay. I noticed that flower represented 61% of sales in the quarter versus pre-COVID, it was in the low 40s. Is that still a reflection of the local? That would be a reflection of the more of the local traffic in your mix maybe than historical?
Dennis Logan
Yes, that's part of that because on the curbside and the home delivery, that is the case where it's the preference from the local customer is more towards - skewed towards that flower market as you know. But as the tourists come back, they tend to buy the higher-margin non-flower products that we sell in terms of our home - our in-house brands. So the margins there are pretty lucrative for us. So - but that mix on the flower side is driven by that local customer, for sure.
Doug Cooper
Right. And so part of that - to get to the mid- to high 30s, can it even, I guess, with more edibles or concentrates, it could help to get there as well? Medizin, so you reopened, $4.9 million, I think, was the last quarter, Larry said in his speak - speech. Given - I know Nevada has grown, but there's been a number of new stores opened as well, albeit one of your competitors is about a mile away, it did very well in the quarter as well. Can you speak to what your expectations are? Can you match where you were? Or do you expect to be more pressured in terms of the competition? And sadly enough, obviously, some - to the SuperStore in the past.
Dennis Logan
Yes. So I'll go turn that one over to Bob for that, Doug.
Bob Groesbeck
Yes, I am happy to address that. Doug, thanks. Yes, there's going to be a bit of a ramp-up. We expected that. I mean the store has been closed for two years now, basically. The timing on the opening was a bit longer than we had anticipated with the regulators. But now we're open, the store is literally continuing to be stocked as we were on this call. So the full rollout of launch with the advertising and messaging on the reopening really starts in earnest later this week, Friday to be exact.
But we're very excited about what the future holds. Since we reopened, we've got a $2 billion stadium down the street from us, and we've got significant improvements to the 215 Freeway system that have just finished. So it's easier than ever to get into our stores. So a lot of upside there. I'm confident that, again, with a brief ramp-up period, we'll get back to the numbers that we were looking at when we closed in October of 2018.
Larry Norman
Right, now, let me just add, this is Larry, that competitor you're talking about was not a competitor when we were open. They became more successful at our location because we had to move our license. When we're back, we'll take over control of that area just like we did before and it'd be just as successful as before, unfortunately, to their detriment. But - even though they're good people, it's - our location is far superior.
Doug Cooper
Your corner boys are going to be back. Just on your wholesales in 40 other dispensaries, I think that's about two thirds of the state's dispensaries. Can you get more? Is this the 40 best ones? And it's now just a question of improving same-store sales at those dispensaries? And how big do you think the wholesale business can be? And I'll leave it there.
Bob Groesbeck
Well, I think - again, Doug, it's Bob. I certainly think there's room for additional growth. And as you know, we've got quite a few new recreational licenses will be coming into the market here over the next 12 to 18 months. So there's a lot of upside there. There's no reason we can't be in two thirds of those stores as we continue to grow. We're excited about that.
Our team tells us that we're getting very positive feedback from the stores that we're not in, that they're interested in looking at our product lines. So they're going to keep pushing. And really, the proof is in sales. And they see what's happening with other stores that are carrying our product lines and they're looking at the sell through rates, so a good business person is going to take advantage of that as well. So there's plenty of room for growth.
Operator
Thank you. Our next question comes from Bobby Burleson with Canaccord. Please proceed with your question.
Bobby Burleson
Thanks for taking my questions. So just thinking about margins again, but maybe honing in a little bit more on wholesale. Kind of curious where you see those margins going with the additional cultivation coming online?
Dennis Logan
Yes, Bobby, it’s Dennis. So the additional cultivation coming online, when we first took it over, we were utilizing some of the flower that was in that - in the facility and the inventory we acquired as part of that asset acquisition. We pushed that through our own production facility and so we have got some great margin enhancements there on our in-house products, using it for the HaHa Gummies, et cetera.
Going forward, as we move our own strains into that facility, there'll be less opportunity to use the flower - or I guess, I could spin it the other way, all of the flower that we can grow in that facility will be sold as premium flower in the store and both at the SuperStore and the Medizin store.
And so it's a higher-margin game for us selling that flower. We were 8% of revenue coming from our own flower in the second quarter, we should see that kind of more than double to 16% to 20%, with the addition of this new cultivation capacity, and it will be in that premium flower category. So I think the margins will be a lot better than what we were getting just running it through and making our own edibles and concentrate products.
Bobby Burleson
So it sounds like the margin opportunity is really in the SuperStore, obviously, as you move that premium flower in and get more of your own shelf space with house products?
Dennis Logan
Yes, for both - well I guess for both, that and the Medizin store, because that will add…
Bobby Burleson
And Medizin, okay.
Dennis Logan
I think we'll sell the majority of our products. I think Medizin will be majority of our products in that store and not as many third-party because it is more of a local market, right?
Bobby Burleson
Perfect, and then just curious, with expansion initiatives beyond Santa Ana for similar large format, exceptional experience stores, what kind of - I guess, what kind of costs are you seeing out there? If you had to compare other metros you're looking at to the kind of costs you've incurred and you expect to incur, both in Las Vegas and Santa Ana for building out large format stores, are there big kind of ranges that you're looking at in terms of the cost of land or labor or other inputs?
Dennis Logan
Yes, I think, the big cost swing, it is a broad range, as you mentioned. I mean the big issue for us is, is it an existing operator with an existing storefront that we're buying and then going to move? Or is it - do we get a license through another means or a license from a party that hasn't opened yet? So it's quite a broad spectrum where we're looking at leased land or leased assets mostly. So we're not going to buy land or buy a building, but we'll lease the building.
So we're partnering with a couple of national real estate groups that have primary locations in the markets we want to be in. And it's just a question of how we go about getting licenses in those individual markets and moving them into the locations that we want. So it's going to be a bit of a mix depending on the state and the city we end up in or the cities we end up in.
Bobby Burleson
Okay, great. So if we start thinking about the growth on top of the kind of 2021 expectations, I mean, obviously, we would get a full year of Santa Ana in 2022. But as we start to layer additional stores potentially on to your forecast, how much dry powder really is that $70 million and kind of the cash generation between now and when you might start building things out? Is that - are you using a mix of cash and stock? It seems like a significantly large amount of dry powder relative to kind of the revenue footprint you guys should have organically I guess in 2021?
Dennis Logan
Yes, I mean, we intend to use cash and stock to get into the markets we want to be in. If we look at Santa Ana, as an example of the mix of cash in stock, if we can replicate that deal, then the $70 million in dry powder gets us a significant number of stores. I don't think that we'll get the - I don't think we'll be able to find as good of a deal that we did in Santa Ana going forward, depending on the markets because there are lots of competition in some of the markets we're looking at. So - but suffice it to say, I think we can at least open four more stores with the $70 million thereabouts and sort of.
Bobby Burleson
Thank you. It’s helpful. And is there a lot of emphasis now being placed on trying to get access to more cultivation assets internally in California going forward? What's your thought on how important that might be over the medium-term?
Dennis Logan
That’s going to depend on the market we're in. If you look at, as you know, the various states have very different supply demand dynamics in them. A lot of them right now are cultivation constrained that's going to depend on the market we're in. Now, if you look at the various states have very different supply demand dynamics in them. Lot of them right now are cultivation constrained. Does that stay the case 18 months from now as a lot of these cultivation facilities come online in the various markets.
So it's going to depend, obviously, if we can be vertically integrated in the markets we go into - will go into markets retail first, definitely have production facilities, extraction facilities built out. And then in the markets where we think that we need to have that security of supply, then we'll definitely look at the cultivation. So some of the opportunities we're looking at are fully integrated. Others are let's get in retail only in this stage and we see where it goes based on what we think the supply demand dynamics are in those markets.
Operator
Thank you. Our next question comes from Greg Gibas with Northland Securities. Please proceed with your question.
Gregory Gibas
And congrats on the strong results this quarter. And as October as well.
Gregory Gibas
Regarding the current plans that are underway to double the sales floor to increase the customer throughput during those peak times like you were saying, how much I guess of an uplift in daily transactions, would you expect to see there? Maybe it's kind of all else is equal? And maybe it would help if you could elaborate maybe on the degree to which you see potential customers maybe being discouraged from visiting or shopping during those peak hours?
Larry Scheffler
Well, this is Larry, let me answer that again. We probably can max out here after COVID, pre-COVID I mean during COVID, we can going to max our in probably $400,000 only because we're at $0.50 capacity. But on a weekend when we're busy, we're probably can't hit past 454, 75 a day when we're busy, all being because we can't get that many people through without having the long lines and the wait times or I hate lines and people just get disgruntled and want to leave.
I think with the adding the 40 more points of sale, adding another inference in, another check in what you're doing all of those, we've done I think would max out of somewhere between $800,000 to $900,000 a day on our busiest days Fridays and Saturdays once we get all the tourists back and everything going on.
We know we have to do it. We will be hitting the wall. We were just expanding so much even with COVID we're still expanding. Can you imagine when we're - when this COVID is over, and again, we're just hitting less than 3% right now of the tours that were coming to town pre-COVID, less than 3% come here.
We even just doubled to six when COVID is over. We will definitely need the double the dispensary. I can even see in the future that if we continue to grow that way we weren't going, and people keep advertising themselves on how well they love the experience here and the shopping experience on the whole situation entertainment complex, I could literally almost see us taking half of the site and maxing out probably with the grand hallway at almost 60,000 square feet. That's again long-term dreams. I'm always optimistic though about it. And we'll start with our first expansion, see how it goes. And I think you'll see us enlarging again here shortly.
Gregory Gibas
Yes, that's extremely helpful, Larry, appreciate that. And I guess part of that kind of relates to my next question just being I sorry if I missed this, but I think you said it was the estimate of kind of the breakdown of tourists versus local this quarter. I guess just kind of rough estimates there. And then also kind of wondering, I know the Medizin store heavily skewed towards locals just kind of wondering what transaction sizes compared with the SuperStore versus Medizin, and maybe what the exact breakdown is in terms of the customer split in terms of locals and tourists, just trying to get a better sense of what that potential uptick in traffic would look like once travel resumes?
Bob Groesbeck
Well, Greg, it's Bob, let me jump on this and then Dennis can fill in the details if necessary, but pre-COVID, we're probably doing about 85% of our customers were not Nevadan. So, since the latter part of March, when we closed, it's really seen that reverse. So I would say, roughly 85% of our customers are now locals. And even more so in the last couple months here this quarter, and now with the governor's recently announced pause, you know, a lot of the major casinos on the strip now are open four days a week.
And now we've got additional lockdowns with clubs. The fourth quarter has historically been slow in the town, but it's been historically slow now with COVID. And with that transition, but I believe that does Larry once this lifts, and we're excited, we think - by the second quarter of next year, things are going to open up considerably. We're going to see that rush, there is a huge pent-up demand, and we know we're very confident with that expansion. We'll be able to service our customers and all of our customers.
So with Medizin, it's a little different. We just reopened it a couple nights ago with a soft opening. To me a little different to give us a little bit of time on that. But if you look historically at what the average basket size was there, considerably lower than what you would have at the SuperStore. So I put it in a $75 range probably from a historical perspective, I'm not quite sure where it's going to come out now. But again, the location is fabulous, the facilities fabulous, and the product lines that we carry are outstanding. So we have every reason to believe that that storage is going to be very successful again.
Gregory Gibas
Great, that's helpful, Bob. The last one for me was just kind of relating to the go forward cost structure, if we think about maybe the SuperStore being pretty well represented in Q3 minus the - I guess, upgrades that you're currently making, how should we think about what the addition to operating expenses that'll come out of Medizin will look like, which are opening this month? I mean, once you kind of the run rate, either?
Bob Groesbeck
Dennis, do you want to take a stab at that?
Dennis Logan
Yes, sure. Sir. Good. Can you repeat that for me?
Gregory Gibas
Oh, yes, no problem, Dennis. I was just kind of wondering what the cost structure will look like once we add in the Medizin store on a go forward basis here in terms of the OpEx I will add to where we're at right now. It's just a SuperStore?
Dennis Logan
Yes, so I guess from a third quarter perspective, we added a lot of people and obviously during Q2, we didn't downsize as part of COVID. So I don't think our OpEx is going to be that much higher than it was in Q3 with the addition of the Medizin store. We've been paying the least the whole time. We've been paying the fixed costs in that place.
The OpEx we're going to move people and we have started scheduling shifts of bud tenders, et cetera, over to that location, but the overall OpEx I don't think it's going to - you're not going to see a big increase over Q3 to get that store up and running and flowing through. Obviously, we can stock it from the products we have in-house as well as third party.
So I don't think the operating costs are going to be that much higher to run that store. And what we're seeing now, in fact, I think if you look at the even the margins in that store will probably - they'll definitely be better than they were back in when it closed, because we're seeing the average ticket sizes from the local customers at the SuperStore onto the home delivery significantly higher than the word the Medizin store previously, and so with the different events that we think will happen in the Allegiant Stadium, and in and around that neighborhood I think we can see some big numbers on certain weekends coming out of that store too with really good margins.
Operator
Thank you. Our next question comes from Scott Fortune with ROTH Capital Partners. Please proceed with your question.
Scott Fortune
Real quick. Can you provide a little more in-store metrics when compared to pre-COVID as far as what is really driving the growth as far as volume and transactions or versus the average ticket size going much higher? Can you just comparison from the pre-COVID levels to where you're at now?
Dennis Logan
So, Scott, this is Dennis before we shut in March for COVID, we were looking at an aim at $100 to $105 average ticket. And we're averaging kind of 60,000-ish customers a month. And then post-COVID, we've seen that ticket go to 125 for in-store customers falling down into the mid to mid-to-high 50s. So definitely the volume is not there in terms of the customer throughput that was pre-COVID.
Part of that is because of as Larry talked about earlier, we can't get the throughput with the 50% operating capacity that we have to abide by under the COVID protocol. So if we can double the size of those registers, I think we can get back up to the 50,000 type of customer traffic, and then the 125 bucks average basket in the SuperStore I think is pretty solid.
Our delivery and curbside model, which is local customers, you're seeing that average ticket size in the $100 dollar range. So still significantly above the 6970 that we were experiencing in October 2018 when we shut the Medizin store, so I think the ticket at the Medizin store will be somewhere between 70 and 100 bucks on average.
Scott Fortune
I appreciate the color. And just real quick on your composition expansion as far as capacities and serving the Nevada market. If we had new dispensaries coming on board kind of how much capacity you have for your own SuperStore and Medizin versus the wholesale side is that -- is that enough capacity as you look out from wholesale looking at two or three years from now?
Dennis Logan
So the current facility as it stands, we can we can double it. So it's a surprise, it adds about 15,000 square feet of canopy at that new facility and a 25,000 square foot building and it's a 40,000 total square foot building. So we can we can get another 15,000 square feet of premium indoor grow out of that new facility. With the two facilities operating I think at least for the next 18 to 24 months, we'll see our ability to satisfy our internal sales of that premium flower in the SuperStore is where all that flower is going to go. So I don't see us really wholesaling any flower to third parties.
What we do right now given that our current the prior to the acquisition of this new facility, we had 15,000 square feet grow all of that flower was sold as flower, premium flower in the SuperStore, and we purchased third party kind of B and C grade flower and trim on the market and push it through our production facility to make our own in-house brands in terms of the edibles and concentrates.
So I think that's going to continue. We still get decent margins out of those product lines because obviously, we're making them ourselves. We have our own brands and we get we get the margin pickup there.
Scott Fortune
Okay, and the last real quick question with the momentum of new states coming on board here, what is the biggest kind of drawback or hold up for moving forward in new states in finding those licenses there? What can accelerate there? What is the holdup currently right now?
Dennis Logan
Yes, I mean, as we discussed before, I think I'll let Bob and Larry add-on, but I think it's our ability to find the license in the location that we want to be in. We're having challenges in certain markets with - we can get a license, but can we move it from store A to the location we want it to be in that's where the challenge is right now. So it's a local political challenge that I think at least based on what I've seen, but Bob, and Larry, let you expand on that.
Larry Scheffler
Well, this is Larry Scheffler. I'll add a little bit to that. We want to do what we've done in the past, and why we think we've been successful. We spend this money like it's our money, even though it's public money. So it's not a good deal as when we are both entrepreneurs, Bob, and I, it's not a good deal for us, it's not a good deal for the corporation, we want a good deal, we don't just want a deal. And we're going to continue to do it, we've done the best and wait for the right opportunity just to leave money in the bank as a knee, we're going to go out and spend it just to spend it. We think that's the wrong way to do it.
We haven't done it in the past. And because of that, we think we've been successful, we've done successful, we'll continue to look for the deals, we'll find them, it takes a little longer. But this way doesn't put us into the category or four or five other groups that have been out there that are all looked at now, doing exactly what we don't want to do. So it's we just keep searching like we did in California and like we did here for the grow has been successful for us and for investors. We're going to continue down that path.
Operator
There are no further questions at this time. I would like to turn the floor back over to management for any closing remarks.
Larry Scheffler
I don't have any further remarks. Bob, do you? This is Larry.
Bob Groesbeck
No, fine, thank you. And again, thank you everyone for participating. We can end the call.
Operator
This concludes today's call. You may disconnect your lines at this time. Thank you for your participation. Have a great evening.
