Become A Featured Company

MariMed Reports Second Quarter 2023 Earnings

Ryan Allway

August 2nd, 2023

News, Top News

NORWOOD, Mass., Aug. 02, 2023 (GLOBE NEWSWIRE) — MariMed Inc. (“MariMed” or the “Company”) (CSE: MRMD) (OTCQX: MRMD), a leading multi-state cannabis operator focused on improving lives every day, today announced its financial results for the second quarter ended June 30, 2023.

 

“I am pleased to report another solid quarter of accelerating revenue growth on both a year-over-year and a sequential basis as we continue to outperform the industry,” said Jon Levine, Chief Executive Officer. “We reported our 14th consecutive quarter of positive adjusted EBITDA. Our wholesale business continued to set monthly and quarterly sales records, which we believe will continue to accelerate with the commencement of adult-use sales in Maryland, which began on July 1st. Our balance sheet remains one of the strongest in the industry, and we were particularly pleased with the exponential growth of our Maryland operations that executed flawlessly to support the increased demand of adult-use sales.”

 

Financial Highlights1

The following table summarizes the Company’s consolidated financial highlights (in millions, except percentage amounts):

  Three months ended
June 30,		   Six months ended
June 30,
    2023       2022       2023       2022  
Revenue $ 36.5     $ 33.0     $ 70.9     $ 64.3  
GAAP Gross margin   45 %     45 %     45 %     50 %
Non-GAAP Gross margin   46 %     46 %     46 %     50 %
GAAP Net (loss) income $ (0.9 )   $ 1.9     $ (1.6 )   $ 6.1  
Non-GAAP Net income $ 0.6     $ 5.5     $ 0.9     $ 12.3  
Non-GAAP Adjusted EBITDA $ 6.3     $ 8.9     $ 13.4     $ 19.3  
Non-GAAP Adjusted EBITDA margin   17 %     27 %     19 %     30 %

 

1 See the reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures and additional information about non-GAAP measures in the section entitled “Discussion of Non-GAAP Financial Measures” below and in the financials information included herewith.

 

“Our 11% year-over-year revenue growth this past quarter demonstrated strong execution during a continued challenging environment,” said Susan Villare, Chief Financial Officer. “We continue to be laser focused on completing our expansion projects to accelerate our revenue growth while leveraging our existing infrastructure to drive increased overall profitability.”

 

CONFERENCE CALL

MariMed management will host a conference call on Thursday, August 3, 2023, to discuss these results at 8:00 a.m. Eastern time. The conference call may be accessed through MariMed’s Investor Relations website, or by clicking the following link: MRMD Q223 Earnings Webcast.

 

SECOND QUARTER 2023 OPERATIONAL HIGHLIGHTS

During the second quarter, the Company announced the following developments in the implementation of its strategic growth plan:

  • April 4: The Maryland Medical Cannabis Commission issued approval to once again manufacture and sell high-dose edibles. The Company added 40mg THC-infused products across its entire edibles portfolio including Betty’s Eddies and Bubby’s Baked, which are all selling at record levels.
  • April 25: Opened an adult-use Panacea Wellness Dispensary in Beverly, Massachusetts, marking the Company’s third operational dispensary in the state, and the 10th dispensary it owns or manages. The Company plans to obtain a license for medical sales at this location as soon as possible.
  • June 12: Opened a medical Thrive Wellness Dispensary in Tiffin, Ohio, marking the Company’s first operational dispensary in the state, and the 11th dispensary it owns or manages across six states. The Company’s goal is to continue to look for opportunities to expand its presence in this state.
  • June 22: Introduced a Limited-Edition THC and CBG Infused Beachtime Betty’s fruit chew for Summertime Relaxation in Massachusetts, Maryland, and Delaware. Beachtime Betty’s joins a full slate of Betty’s Eddies products that feature specific end-effects, including Take It Easy Eddies for stress relief, Go Betty Go for an energy boost, Ache Away Eddies for pain relief, Bedtime Betty’s for restful nights, Elderbetty for an immunity boost, Smashin’ Passion for sexual wellness and Betty Good Times for any time.

 

OTHER DEVELOPMENTS

Subsequent to the end of the second quarter, the Company announced the following development:

  • July 13: MariMed Stages the ‘Boston 280E THC Party’ in Boston Harbor To Protest Unfair Cannabis Industry Tax Laws. Inspired by its 250th anniversary, the Company reenacted the Boston Tea Party. Onboard a schooner in Boston Harbor, MariMed management and employees dressed in colonial outfits and decried unfair IRS Code 280E on behalf of the entire cannabis industry.

 

2023 FINANCIAL GUIDANCE

MariMed remains committed to its proven strategic growth plan and continues to operate some of the best facilities in the cannabis industry. The Company’s guidance for full year 2023 is:

  • Revenue of at least $150 million;
  • Gross margin in line with full year 2022, which was about 48%;
  • Non-GAAP Adjusted EBITDA of at $32 million to $35 million;
  • Capital expenditures of $30 million.

 

DISCUSSION OF NON-GAAP FINANCIAL MEASURES

MariMed’s management uses several different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall performance of its business, and making operating decisions, planning and forecasting future periods. The Company has provided in this release several non-GAAP financial measures: Non-GAAP Gross margin, Non-GAAP Net income (loss), Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP EBITDA margin and non-GAAP Adjusted EBITDA margin, as supplements to Revenue, Gross margin, Net income (loss) and other financial measures prepared in accordance with GAAP.

 

Management believes these non-GAAP financial measures are useful in reviewing and assessing the performance of the Company, and when planning and forecasting future periods, as they provide meaningful operating results by excluding the effects of expenses that are not reflective of its operating business performance. In addition, the Company’s management uses these non-GAAP financial measures to understand and compare operating results across accounting periods and for financial and operational decision-making. The presentation of these non-GAAP measures is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP.

 

Management believes that investors and analysts benefit from considering non-GAAP financial measures in assessing the Company’s financial results and its ongoing business, as it allows for meaningful comparisons and analysis of trends in the business. In particular, non-GAAP adjusted EBITDA is used by many investors and analysts themselves, along with other metrics, to compare financial results across accounting periods and to those of peer companies.

 

As there are no standardized methods of calculating non-GAAP financial measures, the Company’s calculations may differ from those used by analysts, investors and other companies, even those within the cannabis industry, and therefore may not be directly comparable to similarly titled measures used by others.

 

Management defines non-GAAP Adjusted EBITDA as income (loss) from operations, determined in accordance with GAAP, excluding the following items:

  • depreciation of fixed assets;
  • amortization of acquired intangible assets;
  • Impairment or write-downs of intangible assets;
  • stock-based compensation;
  • legal settlements; and
  • acquisition-related and other expenses.

For further information, please refer to the publicly available financial filings available on MariMed’s Investor Relations website, as filed with the U.S. Securities and Exchange Commission, or as filed with the Canadian securities regulatory authorities on the SEDAR website.

 

ABOUT MARIMED

MariMed Inc., a multi-state cannabis operator, is dedicated to improving lives every day through its high-quality products, its actions, and its values. The Company develops, owns, and manages seed to sale state-licensed cannabis facilities, which are models of excellence in horticultural principles, cannabis cultivation, cannabis-infused products, and dispensary operations. MariMed has an experienced management team that has produced consistent growth and success for the Company and its managed business units. Proprietary formulations created by the Company’s technicians are embedded in its top-selling and award-winning products and brands, including Betty’s Eddies, Nature’s Heritage, InHouse, Bubby’s Baked, K Fusion, Kalm Fusion, and Vibations: High + Energy. For additional information, visit www.marimedinc.com.

 

IMPORTANT CAUTION REGARDING FORWARD-LOOKING STATEMENTS:

The information in this release contains “forward-looking” statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, which are subject to several risks and uncertainties.   All statements other than statements of historical facts contained in this release, including without limitation statements regarding projected financial results for 2023, including management’s belief that it will have its fourth consecutive year of positive operating cash flow, anticipated openings of dispensaries and facilities, timing of regulatory approvals, plans and objectives of management for future operations, are forward-looking statements.   Without limiting the foregoing, the words “anticipates”, “believes”, “estimates”, “expects”, “expectations”, “intends”, “may”, “plans”, and other similar language, whether in the negative or affirmative, are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

 

Forward-looking statements are based on our current beliefs and assumptions regarding our business, timing of regulatory approvals, the ability to obtain new licenses, business prospects and strategic growth plan, and other future conditions.   Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict.   Our actual results may differ materially from those contemplated in these forward-looking statements due to various risks, uncertainties, and other important factors, including, among others, reductions in customer spending, our ability to recruit and retain key personnel, and disruptions from the integration efforts of acquired companies.

 

These factors are not intended to be an all-encompassing list of risks and uncertainties that may affect our business and results of operations.   These statements are not a guarantee of future performance and involve risk and uncertainties that are difficult to predict, including, among other factors, changes in demand for the Company’s services and products, changes in the law and its enforcement, and changes in the economic environment. Additional information regarding these and other factors can be found in our reports filed with the U.S. Securities and Exchange Commission.   In providing these forward-looking statements, the Company expressly disclaims any obligation to update these statements publicly or otherwise, whether as a result of new information, future events or otherwise, except as required by law.

 

All trademarks and service marks are the property of their respective owners.

 

For More Information Contact:

Investor Relations:
Steve West, Vice President, Investor Relations
Email: ir@marimedinc.com
Phone: (781) 277-0007

Company Contact:
Howard Schacter, Chief Communications Officer
Email: hschacter@marimedinc.com
Phone: (781) 277-0007

Media Contact:
Grasslands
Email: marimed@mygrasslands.com

 

MariMed Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
 
  June 30,
2023		   December 31,
2022
Assets      
Current assets:      
Cash and cash equivalents $ 14,635     $ 9,737  
Accounts receivable, net   5,509       4,157  
Deferred rents receivable   667       704  
Notes receivable, current portion   2,642       2,637  
Inventory   24,786       19,477  
Investments, current portion   102       123  
Due from related parties   35       29  
Other current assets   9,541       7,282  
Total current assets   57,917       44,146  
Property and equipment, net   78,634       71,641  
Intangible assets, net   18,700       14,201  
Goodwill   11,993       8,079  
Notes receivable, net of current portion   8,457       7,467  
Investments, net of current portion   89       —  
Operating lease right-of-use assets   9,898       4,931  
Finance lease right-of-use assets   2,263       713  
Other assets   1,417       1,024  
Total assets $ 189,368     $ 152,202  
       
Liabilities, mezzanine equity and stockholders’ equity      
Current liabilities:      
Term loan $ 3,600     $ —  
Mortgages and notes payable, current portion   2,050       3,774  
Accounts payable   7,764       6,626  
Accrued expenses and other   3,616       3,091  
Income taxes payable   9,615       11,489  
Operating lease liabilities, current portion   1,828       1,273  
Finance lease liabilities, current portion   752       237  
Total current liabilities   29,225       26,490  
Term loan, net of current portion   20,546       —  
Mortgages and notes payable, net of current portion   26,544       25,943  
Operating lease liabilities, net of current portion   8,631       4,173  
Finance lease liabilities, net of current portion   1,516       461  
Other liabilities   100       100  
Total liabilities   86,562       57,167  
       
Commitments and contingencies      
       
Mezzanine equity      
Series B convertible preferred stock   14,725       14,725  
Series C convertible preferred stock   7,177       23,000  
Total mezzanine equity   21,902       37,725  
       
Stockholders’ equity      
Common stock   372       341  
Common stock subscribed but not issued   —       39  
Additional paid-in capital   167,652       142,365  
Accumulated deficit   (85,527 )     (83,924 )
Noncontrolling interests   (1,593 )     (1,511 )
Total stockholders’ equity   80,904       57,310  
Total liabilities, mezzanine equity and stockholders’ equity $ 189,368     $ 152,202  

 

 

MariMed Inc.
Condensed Consolidated Statements of Operations
(in thousands, except percentages and per share amounts)
(unaudited)
 
  Three months ended   Six months ended
  June 30,   June 30,
    2023       2022       2023       2022  
               
Revenue $ 36,519     $ 32,986     $ 70,899     $ 64,268  
Cost of revenue   20,143       17,981       39,135       32,287  
Gross profit   16,376       15,005       31,764       31,981  
               
Gross margin   44.8 %     45.5 %     44.8 %     49.8 %
               
Operating expenses:              
Personnel   5,619       3,382       10,275       6,424  
Marketing and promotion   1,666       809       2,812       1,452  
General and administrative   5,080       5,565       9,385       11,793  
Acquisition-related and other   425       754       615       754  
Bad debt   39       —       (5 )     14  
Total operating expenses   12,829       10,510       23,082       20,437  
               
Income from operations   3,547       4,495       8,682       11,544  
               
Interest and other (expense) income:              
Interest expense   (2,640 )     (440 )     (5,145 )     (753 )
Interest income   115       318       214       481  
Other (expense) income, net   (10 )     (727 )     (910 )     275  
Total interest and other (expense) income, net   (2,535 )     (849 )     (5,841 )     3  
               
Income before income taxes   1,012       3,646       2,841       11,547  
Provision for income taxes   1,947       1,750       4,440       5,410  
               
Net (loss) income   (935 )     1,896       (1,599 )     6,137  
Less: Net income attributable to noncontrolling interests   23       73       4       126  
Net (loss) income attributable to common stockholders $ (958 )   $ 1,823     $ (1,603 )   $ 6,011  
               
Net (loss) earnings per share attributable to common stockholders:              
Basic $ (0.00 )   $ 0.01     $ (0.00 )   $ 0.02  
Diluted $ (0.00 )   $ 0.00     $ (0.00 )   $ 0.02  
               
Weighted average common shares outstanding:              
Basic   361,261       337,497       352,079       336,137  
Diluted   361,261       379,626       352,079       379,225  

 

 

MariMed Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
 
  Six months ended
  June 30,
    2023       2022  
Cash flows from operating activities:      
Net (loss) income attributable to common stockholders $ (1,603 )   $ 6,011  
Net income attributable to noncontrolling interests   4       126  
Adjustments to reconcile net (loss) income to cash (used in) provided by operating activities:      
Depreciation and amortization of property and equipment   2,247       1,552  
Amortization of intangible assets   1,337       425  
Stock-based compensation   505       5,024  
Amortization of original debt issuance discount   131       —  
Amortization of debt discount   888       —  
Payment-in-kind interest   299       —  
Present value adjustment of notes payable   719       —  
Bad debt (income) expense   (5 )     14  
Obligations settled with common stock   461       274  
Write-off of disposed assets   906       —  
Gain on finance lease adjustment   (13 )     —  
Loss on changes in fair value of investments   30       679  
Other investment income   —       (954 )
Changes in operating assets and liabilities:      
Accounts receivable, net   (1,449 )     (3,554 )
Deferred rents receivable   37       99  
Inventory   (5,309 )     (1,795 )
Other current assets   (1,497 )     (1,267 )
Other assets   359       (142 )
Accounts payable   1,138       2,024  
Accrued expenses and other   (535 )     180  
Income taxes payable   (1,874 )     (6,467 )
Net cash (used in) provided by operating activities   (3,224 )     2,229  
       
Cash flows from investing activities:      
Purchases of property and equipment   (8,786 )     (7,854 )
Business acquisitions, net of cash acquired   (2,987 )     (12,746 )
Advances toward future business acquisitions   (250 )     (250 )
Purchases of cannabis licenses   (601 )     (330 )
Issuance of notes receivable   (879 )     —  
Proceeds from notes receivable   87       73  
Due from related party   (6 )     —  
Net cash used in investing activities   (13,422 )     (21,107 )
       
Cash flows from financing activities:      
Proceeds from term loan   29,100       —  
Principal payments of term loan   (600 )     —  
Principal payments of mortgages and promissory notes   (429 )     (611 )
Repayment and retirement of mortgage   (778 )     —  
Repayment and retirement of promissory notes   (5,503 )     —  
Proceeds from exercise of stock options   35       3  
Principal payments of finance leases   (200 )     (102 )
Redemption of minority interests   —       (2,000 )
Distributions   (81 )     (184 )
Net cash provided by (used in) financing activities   21,544       (2,894 )
       
Net increase (decrease) in cash and cash equivalents   4,898       (21,772 )
Cash and equivalents, beginning of year   9,737       29,683  
Cash and cash equivalents, end of period $ 14,635     $ 7,911  

 

 

MariMed Inc.
Reconciliation of Non-GAAP and GAAP Financial Measures
(in thousands, except percentages)
(unaudited)
 
    Three months ended   Six months ended
    June 30,   June 30,
      2023       2022       2023       2022  
Non-GAAP Adjusted EBITDA              
  GAAP Income from operations $ 3,547     $ 4,495     $ 8,682     $ 11,544  
  Depreciation and amortization of property and equipment   1,261       850       2,247       1,552  
  Amortization of acquired intangible assets   780       285       1,337       425  
  Stock-based compensation   299       2,553       505       5,024  
  Acquisition-related and other   425       754       615       754  
  Adjusted EBITDA $ 6,312     $ 8,937     $ 13,386     $ 19,299  
                 
Non-GAAP Adjusted EBITDA Margin (Non-GAAP adjusted EBITDA as a percentage of revenue)              
  GAAP Income from operations   9.7 %     13.6 %     12.2 %     18.0 %
  Depreciation and amortization of property and equipment   3.5 %     2.6 %     3.2 %     2.4 %
  Amortization of acquired intangible assets   2.1 %     0.9 %     1.9 %     0.7 %
  Stock-based compensation   0.8 %     7.7 %     0.7 %     7.7 %
  Acquisition-related and other   1.2 %     2.3 %     0.9 %     1.2 %
  Adjusted EBITDA margin   17.3 %     27.1 %     18.9 %     30.0 %

 

 

GAAP Gross margin   44.8 %     45.5 %     44.8 %     49.8 %
Amortization of acquired intangible assets   1.2 %     0.3 %     1.0 %     0.2 %
Non-GAAP Gross margin   46.0 %     45.8 %     45.8 %     50.0 %

 

GAAP Net income (loss) $ (935 )   $ 1,896     $ (1,599 )   $ 6,137  
Amortization of acquired intangible assets   780       285       1,337       425  
Stock-based compensation   299       2,553       505       5,024  
Acquisition-related and other   425       754       615       754  
Non-GAAP Net income $ 569     $ 5,488     $ 858     $ 12,340  

 

MariMed Inc.
Supplemental Information
Revenue Components
(in thousands)
(unaudited)
 
  Three months ended   Six months ended
  June 30,   June 30,
    2023       2022       2023       2022  
Product revenue:              
Product revenue – retail   24,336       23,087       47,519       44,528  
Product revenue – wholesale   11,031       7,958       21,407       14,020  
Total product revenue   35,367       31,045       68,926       58,548  
Other revenue   1,152       1,941       1,973       5,720  
Total revenue $ 36,519     $ 32,986     $ 70,899     $ 64,268  

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

Network Partners

Follow Us on Social Media

LinkedIn

About CFN Media Group

CFN Enterprises Inc. (OTCQB: CNFN) owns and operates CFN Media Group, the premier agency and financial media network reaching executives, entrepreneurs and consumers worldwide. Through its proprietary content creation, video library, and distribution via www.CannabisFN.com, CFN has built an extensive database of cannabis interest, assisting many of the world’s largest cannabis firms and CBD brands to build awareness and thrive. For more information, please visit www.cfnenterprisesinc.com.

Disclaimer: Matters discussed on this website contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time-to-time have a position in the securities mentioned herein and will increase or decrease such positions without notice. The Information contains forward-looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, or projections as indicated by such words as "expects", "will", "anticipates", and "estimates"; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation of the Information and the Profiled Issuer as well as any such forward-looking statements. Any forward looking statements we make in the Information are limited to the time period in which they are made, and we do not undertake to update forward looking statements that may change at any time; The Information is presented only as a brief "snapshot" of the Profiled Issuer and should only be used, at most, and if at all, as a starting point for you to conduct a thorough investigation of the Profiled Issuer and its securities and to consult your financial, legal or other adviser(s) and avail yourself of the filings and information that may be accessed at www.sec.gov, www.pinksheets.com, www.otcmarkets.com or other electronic sources, including: (a) reviewing SEC periodic reports (Forms 10-Q and 10-K), reports of material events (Form 8-K), insider reports (Forms 3, 4, 5 and Schedule 13D); (b) reviewing Information and Disclosure Statements and unaudited financial reports filed with the Pink Sheets or www.otcmarkets.com; (c) obtaining and reviewing publicly available information contained in commonlyknown search engines such as Google; and (d) consulting investment guides at www.sec.gov and www.finra.com. You should always be cognizant that the Profiled Issuers may not be current in their reporting obligations with the SEC and OTCMarkets and/or have negative signs at www.otcmarkets.com (See section below titled "Risks Related to the Profiled Issuers, which provides additional information pertaining thereto). For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity-based compensation in the companies it writes about, or a combination of the two. For full disclosure, please visit: https://www.cannabisfn.com/legal-disclaimer/. A short time after we acquire the securities of the foregoing company, we may publish the (favorable) information about the issuer referenced above advising others, including you, to purchase; and while doing so, we may sell the securities we acquired. In addition, a third-party shareholder compensating us may sell his or her shares of the issuer while we are publishing favorable information about the issuer. Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time to time have a position in the securities mentioned herein and will increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity- based compensation in the companies it writes about, or a combination of the two. For full disclosure please visit: https://www.cannabisfn.com/legal-disclaimer/.

Copyright © Accelerize Inc. · All Rights Reserved · Privacy Policy · Legal Disclaimer

loading