Earnings Roundup: MJardin, iAnthus and Charlotte’s Web

 

MJardin Group

MJardin Group, Inc. (CSE: MJAR), reported financial results for its third quarter ended September 30, 2018. The company’s revenue increased 65.1% to $7.0 million versus last year’s $4.3 million. The company said that the revenue growth was driven primarily by facility design and build-out fees earned from GrowForce for cultivation centers, interest on notes receivable and rent income earned from Buddy Boy Brands.

Still, MJardin delivered a net loss of $0.4 million versus last year’s net income of $0.6 million. The company attributed the loss to higher interest expense, compensation and benefits, and higher legal and consulting fees related to recent acquisitions, equity and RTO transactions.

“We are pleased to report our first quarterly results as a publicly traded company, continuing our strong growth trends and positive EBITDA,” said Rishi Gautam, Chairman of MJardin. “This is a very exciting time for MJardin with this month’s public listing of MJardin shares and the announcement of the proposed acquisition of GrowForce. We believe we are well positioned as one of the largest and most experienced cannabis operators in North America and as the largest multi-national operator.”

At the end of the third quarter, MJardin was managing 37 total facilities/operations. The company’s total operating expenses jumped by 58.9% to $5.8 million over last year’s $3.6 million. MJardin said that the increase reflects increased compensation and benefits to support that growth, including increased grow facility personnel at operator facilities and the continued expansion of the company’s executive team and corporate office personnel.

Subsequent to the quarter ending, MJardin completed an equity capital raise for approximately C$26 million. On November 13, 2018, MJardin completed the reverse take-over of Sumtra Holdings. On November 15, 2018, the company began trading on the Canadian Securities Exchange and the $26 million of subscription receipt proceeds were released from escrow and available to the Company.

iAnthus

Following the market close on Tuesday, iAnthus Capital Holdings (CSE: IAN, OTCQB: ITHUF) reported its earnings for the third quarter of 2018 ending in September. The sales for the quarter were $939,098 with a gross profit of $2.6 million. The net loss for the three months ending September 30, 2018, was approximately $10.0 million.

“iAnthus continues to execute,” said CEO Hadley Ford. “The company has expanded its footprint and added to its industry leading-team while maintaining a prudent balance sheet throughout the process. We are now generating revenue in five of the six markets in which we operate, with a significant number of dispensaries expected to open within the next few months. Assets are up 344% year-over-year as we grow the iAnthus platform across the United States. This performance, combined with the outlook for our Massachusetts, New York and Florida operations and the pending acquisition of MPX, position us very well for 2019.”

iAnthus reported that its consolidated revenues for the company increased 101% quarter-over-quarter, increasing to $1,074,398 in Q3 from $533,545 in Q2, yet these figures didn’t appear in the company’s filing. The company also said in its press release that system-wide revenues, including the revenues from iAnthus’ investments in New Mexico and Colorado, were $5,139,769 in Q3, up 16% quarter-over-quarter from $4,415,368 in Q2. These figures are unaudited and are not consolidated by the company at present due to certain regulatory restrictions.

In a statement, the company reported that its cash balance is currently $24.3 million. As of November 26, 2018, the Company had 20,933,995 warrants outstanding, all of which are currently in the money. iAnthus would receive approximately $54.5 million if all outstanding warrants were exercised.

Charlotte’s Web

Charlotte’s Web Holdings, Inc. (CSE: CWEB, OTCQX: CWBHF) reported financial results for the third quarter ending September 30, 2018. Organic revenue growth of 57% to $17.7 million versus last year’s $11.3 million for the same time period. Net income fell to $1.8 million from last year’s $2 million for the same time period.

Gross profits increased 54% to $13.8 million over last year’s $9 million for the same time period. Earnings per diluted share fell to two cents from last year’s three cents for the same quarter.

“During the third quarter we completed a successful initial public offering and private placement that generated significant capital for the company that is being deployed to accelerate our growth in the hemp-derived CBD sector,” said Hess Moallem, President and Chief Executive Officer. “This capital is being used primarily to expand the company’s cultivation and production capacities to meet the increasing demand for our industry-leading Charlotte’s Web products, both domestically and internationally.”

The company’s statement said that on a year-over-year basis for the third quarter, e-commerce revenue grew by 37% and wholesale, distributor and retail revenue grew by 118%. Revenue from human nutrition products and animal nutrition products grew by 42% and 153%, respectively (canine products were introduced in February of 2017).

Debra Borchardt

Debra BorchardtDebra Borchardt

Debra Borchardt is the CEO, Co-Founder, and Editor-In-Chief of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Masters degree in Business Journalism from New York University.


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