MariMed Inc. (MRMD:OTCQX) announced preliminary, unaudited, select financial results for the quarter ending March 31, 2020. Revenue increased 112% to $7.5 million versus $3.5 million in the first quarter of 2019. The company did not release a net profit or loss number, but it did say that it had EBITDA of $1.5 million, compared with an EBITDA loss of $4,000 in Q1 2019. MariMed also delivered a gross profit of $4.6 million compared with $2.3 million in Q1 2019.
“The success of our consolidation strategy contributed to our sales momentum in the first quarter of 2020, enabling us to grow quarterly revenues by 112% compared to the prior-year period,” said Bob Fireman, CEO of MariMed. “We are pleased with the consistently strong performances reported by our consolidated cannabis businesses in Illinois and Massachusetts as well as an increase in licensing revenues, in line with our strategic growth plan.”
First Quarter Revenues
The company attributed its year-over-year increase of approximately $4.0 million to the consolidation of the company’s cannabis client businesses in Illinois and Massachusetts. In a statement, the company said that revenue from these now wholly-owned subsidiaries, KPGs in Illinois and ARL Healthcare in Massachusetts, are expected to increase significantly over the balance of 2020. “Revenue from licensing fees from the sale and distribution of MariMed branded products Betty’s Eddies and Kalm Fusion brands, increased 34% over the same period in the prior year and are expected to experience significant growth over the balance of 2020.”
MariMed also gave an update with regard to the pandemic’s effect on the company. MariMed was allowed to provide its Massachusetts medical cannabis patients with uninterrupted access to the products they needed during the pendency of the pandemic. In addition, the company said it was recently granted three provisional adult-use licenses by the Massachusetts Cannabis Control Commission (CCC) for cultivation, production, and a dispensary. “The cultivation and production licenses will be utilized at its New Bedford manufacturing facility and the dispensary license at its Panacea Wellness in Middleborough. MariMed said it expects to begin selling cannabis products for adult-use in the coming months, pending final inspections by the Massachusetts authorities.
MariMed also said it filed for a 45-day extension with the SEC to delay reporting its earnings due to COVID-19.
MariMed said that when adult-use cannabis sales became legal in Illinois, it had an immediate sales ramp-up in the first quarter of 2020 at two of its medical cannabis dispensaries. MariMed also announced it has a third dispensary under development in Illinois which will benefit significantly from Illinois’ new adult-use program.
Fireman added, “As we move through 2020, we expect to continue strong revenue growth from further consolidation of our client businesses as well as the expansion of our product portfolio into additional states.”