iAnthus Reports Earnings As Restructuring Plan Continues

iAnthus Capital Holdings, Inc . (OTCPK: ITHUF) reported its financial results for the fourth quarter and year ending December 31, 2020. The company delivered revenue of $46.0 million for the quarter with a net loss of $27.3 million, or a loss of $0.16 per share. 

For the full year, iAnthus delivered revenue of $151.7 million, up 93.5% from the prior year with a net loss of $309.8 million, or a loss of $1.81 per share. The company became a U.S. reporting company effective February 5, 2021, and all the financial statements are reported in accordance with U.S. Generally Accepted Accounting Principles (GAAP). All currency is expressed in U.S. dollars.

Recapitalization Plan Still Ongoing

The company also noted that it did not make applicable interest payments due on its 13% senior secured convertible debentures and its 8% convertible unsecured debentures due during 2020. The non-payment of interest in March 2020 triggered an event of default with respect to these components of the company’s long-term debt, which, as of December 31, 2020, consisted of principal amounts at face value of $97.5 million and $60.0 million and accrued interest of $15.1 million and $4.8 million on the Secured Notes and Unsecured Debentures, respectively. In addition, as a result of the default, the company has accrued additional fees and interest of $13.8 million in excess of the aforementioned amounts that are further detailed in the company’s financial statements.

iAnthus entered into a restructuring support agreement with its debtholders to effectuate a recapitalization transaction to be implemented by way of a court-approved plan of arrangement under the Business Corporations Act British Columbia ). On September 14, 2020, the company’s security holders voted in support of the Recapitalization Transaction, and on October 5, 2020, the Plan of Arrangement was approved by the Supreme Court of British Columbia.

If consummated, iAnthus said it intends to issue up to an aggregate of 6,072,579,699 common shares upon the restructuring of (i) $22.5 million of Secured Notes (including the Exit Fee), $40.0 million of Unsecured Debentures, including interest accrued thereon and (ii) interest accrued on the interim financing in the amount of $14.7 million provided by the Secured Lenders. “The Recapitalization Transaction remains subject to the receipt of all necessary regulatory approvals and approval by the CSE. Specifically, certain of the transactions contemplated by the Recapitalization Transaction have triggered approval by U.S. state-level regulators in the states in which the Company operates. Where required, iAnthus has commenced the review and approval process.”

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