The U.S.-based medical marijuana company MariMed Inc. (MRMD) stock jumped 13% after it reported its first-quarter financial results for 2018 with revenues increasing 81% to $2.08 million compared to $1.15 million first quarter of 2017. The company attributed the increase to the expanding operations of MariMed’s medical marijuana clients from real estate revenue, management fees and licensing fees.
Unfortunately, the company delivered a net loss of $1.83 million in the quarter versus net income of $0.11 million for the quarter last year. MariMed said that the loss was blamed on non-cash equity compensation and debt settlements in 2018 that it said would have no impact on operations/cash flow. MariMed happily reported $251,166 of operating income in first quarter of 2018, an increase from $228,552 for the same time period in 2017.
“MariMed continues on a solid trajectory of year over year growth that it has achieved each quarter since 2015,” stated Robert Fireman, CEO of MariMed Inc. “Our new Maryland cultivation and production facility, which came online in Q1, will bring increased rent, management, and licensing fees, adding to our existing revenue streams from facilities in Illinois, Delaware, and Nevada. We anticipate increases in our revenue from our assets as the cannabis business in Maryland and Massachusetts continues to expand.”
According to the company statement, it raised approximately $1.5 million in equity through the sale of its 144 common stock in a private placement in 2018 at prices averaging 15% below the market price. “We raised approximately $1.5 million in capital and reduced our debt by approximately $ 1.5 million in the quarter,” noted Jon Levine, MariMed CFO. “We are displaying to investors and shareholders our consistent performance on quarter over quarter growth.”
“As cannabis legalization takes effect on July 1 in Massachusetts, we expect to supply dispensaries with our branded marijuana products across the state,” said Mr. Fireman. “We are scheduled to open our first dispensary in Massachusetts the third quarter of 2018, further bolstering our ongoing revenue streams from managed services and the leasing of our cannabis facilities.”
“With each new client, we generate significant revenue from fees for leases, licenses, and managed services,” Jon Levine, continued. “We expect incremental growth in licensing from new product lines and organic growth from product sales as our licensed Nature’s Heritage Cannabis, Kalm Fusion, Betty’s Eddies, Tikun Olam and Lucid Mood brands gain loyal followings in each current market and as we expand our national distribution network to additional states.”
“Building upon our diverse platform, we are continuing to raise capital for new business and product development, strategic acquisitions and expansion of infrastructure that will enable us to take advantage of this critical time in the industry,” concluded Mr. Fireman.
MariMed stock gained 13% to lately trade at $1.62. The stock is nearing its 52-week high of $1.77.