Alcanna Inc. (TSX: CLIQ) is officially cancelling the company’s quarterly dividend payment program, which has been providing payments to shareholders since January of 2011.
In conjunction with that announcement, effective immediately Alcanna is also nixing the company’s dividend reinvestment plan, which allowed shareholders to use their cash dividends towards buying extra shares at a lower price.
The final dividend payment distributed to shareholders was the third quarter 2018 payment of 9 cents per common share.
Alcanna issued this statement about the policy change:
“The company believes that it is in the best interests of the shareholders to invest all free cash flow in the growth opportunities available to the business which is expected to result in an increase in shareholder value over the medium term versus continuing dividend payments.”
Previously known as Liquor Stores N.A. Ltd, the company switched names to Alcanna after 98.5% of shareholders voted to approve the change at an annual special meeting held on May 8, 2018.
At that same meeting, shareholders also voted to increase the size of the company’s board to 12 members, as well as a resolution to approve additional investment from Aurora Cannabis (TSX: ACB).
Alcanna was one of the early companies to jump into the Canadian legalized recreational market through its Nova-branded stores.
Although the company normally only discloses financials in quarterly reports, due to high demand for information from investors Alcanna revealed that the first five days of marijuana legalization saw the Nova stores make a combined $1.3 million in revenue.
Alcanna Chief Executive Officer James Burns commented on that milestone:
“These figures are truly impressive. But we certainly need to put them in perspective since they are reflective of both the novelty of legalization finally happening and the very limited number of retail outlets that were able to get open for October 17th.”
Burns added, “Alcanna’s experience in controlled-substance retail and financial strength enabled us to have sufficient inventory on hand to last right through opening weekend. It is a positive start to the long road of getting the black market out of cannabis.”