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MariMed reports earnings

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TheQueen
(@gtosali1967)
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We executed on our strategic plan, growing revenue both year-over-year and sequentially," said Bob Fireman, Chief Executive Officer of MariMed. "Our growth was driven by increased traffic in our dispensaries despite the headwinds facing the entire industry and inflation in the U.S. being at a 40-year high. We continue to report some of the strongest financial results in the industry(1) and remain poised for reaccelerated revenue and earnings growth in 2023 and beyond."

Financial Highlights(2)

The following table summarizes the consolidated financial highlights for the three months ended June 30, 2022 and 2021 (in millions, except percentage amounts):

 
                                        Three months ended 
                                             June 30, 
                                  ------------------------------ 
                                        2022           2021 
Revenue                            $      33.0        $32.6 
Gross Margin                                45%          60% 
GAAP Net income                    $       1.9        $ 7.6 
Non-GAAP Adjusted EBITDA           $       8.9        $13.9 
Non-GAAP Adjusted EBITDA Margin             27%          43% 
Working Capital                    $       8.9        $13.9 
 

(1) Per company research of public filings of peer companies in the U.S. cannabis industry.

(2) Please 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" in the attached schedules.

CONFERENCE CALL

MariMed management will host a conference call on Tuesday, August 9, 2022, to discuss these results at 8:00 a.m. Eastern time. The conference call may be accessed through MariMed's Investor Relations website by clicking the following link: MariMed Q222 Earnings Call.

SECOND QUARTER OPERATIONAL HIGHLIGHTS

During the second quarter, the Company executed on multiple facets of its strategic growth plan, including:

   -- April 27: The Company completed the acquisition of Kind Therapeutics USA, 
      a Maryland cannabis operator specializing in the cultivation, production, 
      and wholesale sales of cannabis flower, concentrates, and other edibles 
      from its 180,000 square foot facility in Hagerstown. MariMed is in the 
      process of opening a dispensary in Annapolis, which will lead to the 
      Company's operations becoming fully vertical in the state. 
   -- May 5: The Company completed the acquisition and received final approval 
      of an Illinois wholesale "craft grow" license transfer. MariMed 
      subsequently acquired a facility in Mt. Vernon, Illinois and began 
      construction on this new cultivation and processing facility, which will 
      allow the Company to grow, produce and wholesale its award-winning 
      branded products throughout the state of Illinois. 
   -- May 18: MariMed announced it was selected to receive a provisional 
      dispensary license by the Ohio Board of Pharmacy, which allows the 
      Company to build a medical dispensary in Tiffen, Ohio, which will be 
      operational in 2023. Ohio marks the sixth state in which MariMed owns or 
      manages cannabis operations. 
   -- June 29: The Company announced a licensing deal with a partner to sell 
      its award-winning Betty's Eddies fruit chews into the Maine adult-use 
      cannabis market, beginning later this year. This licensing deal is in 
      addition to a licensing deal already in place to sell Betty's Eddies into 
      Maine's medical cannabis market with another partner. 

OTHER BUSINESS DEVELOPMENTS

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

   -- July 12: MariMed announced the dual listing of its common shares on the 
      Canadian Securities Exchange ("CSE") under the stock symbol MRMD. 
      Management believes a dual listing on the CSE allows easier access for 
      institutional and retail investors in Canada and North America to acquire 
      MariMed stock. The Company has already seen new institutional investors 
      taking equity positions in the Company's common stock. 
   -- July 18: MariMed announced the approval of its expanded state-of-the-art 
      kitchen in Maryland. The nearly ten-fold expansion allows the Company to 
      produce all its award-winning branded products including Betty's Eddies 
      fruit chews, Bubby's Baked, Kalm Fusion, and Vibations drink mixes. The 
      Company also introduced a brand-new line of gummies for the Maryland 
      medical cannabis market. 
   -- August 4: The Company announced the launch of its new Betty's Eddies ice 
      cream in cooperation with Boston based Emack & Bolio's(R) ice cream 
      company. Betty's Eddies ice cream is currently available in select 
      cannabis dispensaries in Massachusetts offering both dairy and vegan 
      choices. 
   -- August 8: The Company announced the acquisition of a conditional 
      dispensary license in the central eastern part of Illinois bordering 
      Indiana. Once open, it will mark the fifth Thrive branded dispensary the 
      Company owns and operates in Illinois. MariMed currently owns and 
      operates four adult-use dispensaries in Anna, Harrisburg, Metropolis, and 
      Mt. Vernon. 

UPDATED 2022 FINANCIAL GUIDANCE

MariMed remains committed to its proven strategic growth plan and continues to operate some of the best cannabis facilities with some of the highest margins and returns in the cannabis industry. The Company's revised financial targets for 2022 are as follows:

   -- Revenue of $135 million to $140 million versus the previous range of $145 
      million to $150 million. 
 
   -- Gross margin of approximately 50% versus the previous range of 54% to 
      55%. 
 
   -- Non-GAAP Adjusted EBITDA of $35 million to $40 million versus the 
      previous range of $47 million to $52 million. 
 
   -- Capital expenditures of $18 million versus the previous target of $25 
      million. 

"The second quarter brought some challenges to the industry and MariMed that were primarily outside of our control. We took assertive actions that drove additional traffic into our dispensaries and launched multiple new products that are increasing our sales within our wholesale business," said Susan Villare, Chief Financial Officer of MariMed. "We are confident that the financial and operational decisions we are making positions us for accelerating growth in the near term and beyond."

DISCUSSION OF NON-GAAP FINANCIAL MEASURES

The Company has provided in this release several non-GAAP financial measures: non-GAAP net income, Non-GAAP Adjusted EBITDA, and non-GAAP Adjusted EBITDA margin, as a supplement to Revenue, Gross margin, 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, 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 net income, determined in accordance with GAAP, excluding the following items:

   -- interest income and interest expense; 
 
   -- income taxes; 
 
   -- depreciation of fixed assets; 
 
   -- amortization of acquired intangible assets; 
 
   -- Impairment or write-downs of intangible assets; 
 
   -- stock-based compensation; 
 
   -- legal settlements; 
 
   -- acquisition-related and other; 
 
   -- other income and other expense; 
 
   -- and discontinued operations. 

For further information, please refer to the Company's Quarterly Report on Form 10-Q for the three month period ended June 30, 2022 available on Marimed's Investor Relations website, on the SEC's Edgar website in the U.S., or on the Canadian securities regulatory authorities' SEDAR website in Canada.


   
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TheQueen
(@gtosali1967)
Reputable Member
Joined: 11 months ago
Posts: 180
Topic starter  

MariMed getting SLAMMED


   
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D. H. Taylor
(@dhtaylor)
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Joined: 2 years ago
Posts: 1053
 

Miss on revenue & earnings expectations.  MRMD stock is getting clocked hard.  But, the misses were small.  Still, expectations must have been big.  


   
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