Jushi Holdings Inc. (CSE: JUSH) (OTCQX: JUSHF) decided to jump the gun with its good news and pre-announced its second-quarter 2021 financial results. Jushi reported that its revenue increased 14.6% sequentially to $47.7 million. This was a year-over-year increase of 219.7%. It was also within the range that had been forecast during the company’s last earnings report. At that time CEO Jim Cacioppo said, “For the second quarter of 2021, we expect revenues to be between $45 to $48 million and Adjusted EBITDA to be between $4 to $6 million.”
The company delivered an adjusted EBITDA of $4.6 million, or 9.6% of revenue for the second quarter. Jushi also trimmed its net losses in the second quarter to $11.4 million from the first quarter’s net loss of $28 million.
“Our second quarter 2021 results demonstrate the strength of our operations, with solid organic revenue growth at the high end of our guidance range and Adjusted EBITDA (A) in line with our expectations,” said Jim Cacioppo, Chief Executive Officer, Chairman and Founder of Jushi. “With 20 stores open, four cultivation and production facilities in operation, and a diversified medical and consumer brand portfolio, we have built a national footprint for long-term success. In the second half of 2021, we expect to open an additional seven BEYOND / HELLO retail stores nationally, add two Nature’s Remedy of Massachusetts, Inc. dispensaries as well as a grower-processor facility in Massachusetts through an acquisition. Additionally, while construction at our Pennsylvania and Virginia grower-processor facilities has progressed, both projects are currently facing approximately three-month delays due to disruptions in the supply chain, which have negatively impacted the availability and pricing of construction materials. We believe the expansion of our retail footprint, including into Massachusetts, will continue to fuel our momentum through the second half of 2021, while the increase in cultivation capacity will more meaningfully contribute to our financial results in 2022.”
Arbitration Panel Rules In Jushi’s Favor
The company has had a spate of good news. Late last week, Jushi announced that the American Arbitration Association awarded $14,364,920.10 to Jushi Florida in its dispute against San Felasco Nurseries, Inc., a subsidiary of Harvest Health & Recreation. The Interim Award consists of $10,637,012 in damages, plus $3,727,908.14 in pre-award interest (accrued at a rate of $3,497.099 per day) and post-award interest at a rate of 12% per annum. The Panel of three arbiters also affirmed that Jushi is entitled to recoup attorneys’ fees from San Felasco, in an amount to be determined by the Panel.
The company said in a statement that the Interim Award was based on breach of contract and breach of the implied covenant of good faith claims brought by Jushi against San Felasco in October of 2018. “In its order, the Panel found that San Felasco improperly terminated its franchise agreements with Jushi FL without cause and in bad faith. San Felasco then sold its Florida cannabis business to Harvest, depriving Jushi of the royalties it would otherwise have realized. Following a final hearing in May of 2021, the Panel issued the Interim Award on July 29, 2021.”
“I am very pleased that the arbitration panel has ruled in our favor,” said Cacioppo. “This is the right outcome and highlights the strength of our company from a legal and business development perspective to successfully navigate through this complicated and highly regulated industry.”