John SchroyerColorado-based Medicine Man Technologies, which does business as Schwazze (OTCQX: SHWZ) (NEO: SHW), announced in its first-quarter earnings report that the company has moved into the black with a $1.7 million profit, an immense turnaround from the $26.8 million loss it posted for the same quarter in 2022.
The company reported that it turned a corner with an “accounting revaluation of the derivative liability related to the convertible note,” which brought it into profitability for the quarter.
“While weathering tough macroeconomic and industry-specific conditions, our team continues to deliver disciplined improvements to the core business infrastructure with smart, accretive acquisitions within two highly competitively markets,” said CFO Forrest Hoffmaster.
Schwazze also reported solid 26% revenue increase, to $40 million from $31.8 million a year prior, in large part due to its expansion into New Mexico and getting its supply chain in that state vertically integrated.
The company also kept executing on its expansion plans through the first quarter, inking deals in Colorado to buy Standing Akimbo as well as two Smokey’s shops in Fort Collins and Garden City, and for New Mexico chain Everest Apothecary for $38 million.
The acquisitions brought Schwazze’s retail footprint to 60 dispensaries, it reported, along with three manufacturing facilities and six grow sites.
Beyond that, Schwazze:
- Opened two new R.Greenleaf shops in New Mexico.
- Launched e-commerce platforms for customers in both Colorado and New Mexico.
- Debuted a new in-house flower brand.
- Shuffled its C-suite with the hires of CFO Hoffmaster and Chief Legal Officer Christine Jones.
- Hired former SLANG Worldwide CEO Chris Driessen as Schwazze’s new executive vice president of commercial sales.
At the end of March, Schwazze had $35.1 million in the bank, and CEO Justin Dye projected confidence heading into mid-2023.
“We believe our growing variety of retail brands resonate strongly with our cannabis customers, and the team is well-positioned to play offense as we continue to strengthen our position for shareholders,” Dye said.
