Greenlane Archives - Green Market Report

Debra BorchardtMarch 10, 2022
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7min11710

Greenlane Holdings, Inc. (NASDAQ:GNLN) announced layoffs, cost-cutting efforts and leadership changes in order to become profitable. The company also provided preliminary financial results for its fourth quarter and full year ended December 31, 2021.

Greenlane had been flying high on sales of JUUL flavored vape pens. However, problems arose over the excessive teen usage of the candy flavored vapes and regulations caused the market to pull back heavily. That was followed by the vape crisis in the cannabis market when illicit market vapes began causing health problems. At that point Greenlane joined forces with cannabis packaging company KushCo Holdings, which in turn made the move to cut out its small customers and only focus on the big ones that had no trouble paying the bills.

“We recognize the importance of achieving profitability, especially in this current inflationary climate, which has seen COVID-related supply chain disruptions increase the expenses and working capital needs of virtually every industry,” said Nick Kovacevich, CEO of Greenlane. “We have made meaningful efforts to eliminate nonessential and duplicative costs as a result of our merger with KushCo. However, now is the time to take our cost-cutting initiatives to the next level. We have taken another hard look at our business and where we can reduce additional expenses without disrupting the current operations or future growth of Greenlane. Our recent reduction in force will help us generate approximately $8 million in additional annual cash compensation savings, significantly accelerating our path to profitability. Along with other cost-cutting initiatives that we intend to implement in the coming weeks and months, we expect to drastically lower our cost structure and reduce our current Adjusted SG&A expenses by nearly 40% year-over-year by Q3 2022. Meanwhile, we have been investing in technology to improve the customer experience and drive further efficiencies.

Preliminary Earnings

Greenlane reported that it is reiterating its expectation of net sales to be between $55.5 million and $56.5 million for the fourth quarter and between approximately $165.5 million and $166.5 million for the full year ended December 31, 2021. The year-over-year increase in net sales was primarily driven by an increase in sales of Greenlane Brands, as well as the KushCo merger. The increase was partially offset by lower nicotine sales and sales of lower-margin third-party brands, as part of the company’s continued focus on shifting away from these product categories and focusing more on higher-margin proprietary Greenlane Brands.

Adjusted SG&A is expected to be between approximately $20.0 million and $22.0 million for the fourth quarter ended December 31, 2021, and between $75.0 million and $77.0 million for the full year ended December 31, 2021.

The net loss is expected to be between approximately $11.0 million and $13.0 million for the fourth quarter ended December 31, 2021, and between approximately $53.0 million and $55.0 million for the full year ended December 31, 2021.

Layoffs

Kovacevich continued, “Lastly, we are pursuing several initiatives to capitalize the business and increase liquidity, while limiting dilution to our shareholders. This includes selling our corporate headquarters building and non-core assets; discontinuing and disposing of slow-turning, low-margin inventory; and securing an asset-based loan that can support the company’s working capital needs. We recognize the difficulties in raising equity capital at our current trading price, and will continue to evaluate ways to support the business with as little dilution as possible. Overall, we remain as optimistic and encouraged as ever with our strategy to grow our higher-margin Greenlane Brands and to become the leading house of brands in the ancillary cannabis industry. And with these strategic changes, we believe we are that much closer toward achieving our vision.”

Greenlane said it expects the reduction in workforce to result in approximately $8.0 million in annualized cash compensation cost savings. Layoffs took place in the U.S. and abroad. In addition to cutting back on employees,  the company said it was reducing its facility footprints worldwide and adjusting its go-to-market strategy significantly to reduce its operating costs and enhance liquidity. These changes should result in between approximately $14.0 million and $16.0 million in savings on a quarterly basis by Q3 2022, down from approximately $26.6 million in Q3 2021.

Leadership Changes

Adam Schoenfeld will step down as Chief Marketing Officer, effective March 31, 2022. Mr. Schoenfeld is a co-founder and board member of Greenlane. Greenlane said it would not seek to fill the vacant role of Chief Marketing Officer at this time and Schoenfeld will continue to serve on the company’s board of directors.

In addition, the Company has appointed Craig Snyder as its new Chief Commercial Officer, effective March 28, 2022. Mr. Snyder is an experienced leader with over 20 years of success in driving growth and development of high tech and emerging technology organizations. Mr. Snyder has held senior leadership positions at two Fortune 100 companies (Pepsi Cola & Citibank) with executive leadership experience in two successful startup to Nasdaq IPO success stories (Go2Net & Marchex), as well as significant experience with large scale M&A integration and restructuring.

Kovacevich added, “In addition, we are implementing various leadership changes at both the executive and other levels to support our new strategic plan. We are incredibly fortunate for Adam’s many contributions and insights while serving in his various executive roles at the Company. Adam is a true pioneer and industry leader, and we are pleased to continue to leverage his strategic insights as a member of our Board. We are also excited to announce the appointment of Craig as our new Chief Commercial Officer. Craig is a proven business leader with deep commercial, restructuring, M&A, and leadership experience that we believe will be invaluable for our business as we continue to scale our Greenlane Brands. He has already contributed significantly in his current role as a restructuring consultant, and we look forward to his additional guidance and insights once his appointment becomes effective.

Debra BorchardtNovember 15, 2021
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Greenlane Holdings, Inc. (Nasdaq:GNLN) reported financial results for the third quarter ended September 30, 2021, as total revenue increased 16% to $41.3 million versus last year’s $35.8 million. Net losses at Greenlane increased 108% to $$28.7 million versus last year’s net loss of $13.7 million.

Nick Kovacevich, CEO of Greenlane Holdings, said: “Q3 was a transformational quarter for Greenlane, with the completion of our merger with KushCo creating the industry’s leading ancillary cannabis company and house of brands. Our first few months as a combined company have been off to a strong start, as demonstrated through several realized revenue and cost saving synergies, including the consolidation of certain vendors and infrastructure and the development of go-to-market cross-selling strategies across each of our respective platforms. We are extremely pleased with the progress we have made on our integration efforts to date, while simultaneously driving meaningful progression in the business. We also generated another strong quarter of sales for our Greenlane Brands, which, despite the normal and expected challenges of closing a merger, still represented the second-highest quarterly revenue contribution in company history.”

Revenue Breakdown

Greenlane said it had reached its second-highest sales level in company history for Greenlane Brands, which grew to $8.4 million in the quarter, up 26% versus $6.7 million in sales for in the same time period in 2020. Greenlane Brands accounted for 20.4% of the quarter’s total revenue compared with 18.7% of total revenue for last year.

Net sales in the U.S. increased 29.4%, to $37.5 million, while net sales for Canada fell to $1 million from last year’s $4.4 million, primarily due to an expected decrease in nicotine sales as a result of the company’s strategic shift away from low-margin nicotine sales. Net sales for Europe increased 21.3% to $2.8 million, primarily due to an increase in B2B and third-party marketplace website sales.

Looking Ahead

The Company is targeting to achieve $70 million and $100 million in Greenlane Brands revenue for 2022 and 2023, respectively. In addition, the Company expects Greenlane Brands, as a whole, to generate 45% product margins, and to comprise between 22% and 28% of total revenue in 2022.

Kovacevich continued, “Looking ahead, we will continue to build our portfolio of higher-margin proprietary brands, as seen by our recent announcement to acquire leading high-margin vaporizer brand DaVinci, which expands our Greenlane Brands portfolio, and is expected to strengthen our overall margins and profitability in the near-term. With our enhanced operations, customer base, and product portfolio, we are in a stronger position than ever to execute on our growth strategy and drive significant value for our customers, partners, and shareholders.”


Debra BorchardtAugust 17, 2021
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Greenlane Holdings, Inc. (Nasdaq: GNLN) reported financial results for the second quarter ended June 30, 2021, with revenue increasing 7.1% to $34.7 million from last year’s $32.4 million. It was a slight miss for Greenlane from the average analyst estimate from Yahoo Finance for revenue of $35.5 million.

The net loss fell 7.5% to $5.8 million from last year’s $6.3 million net loss. The net loss per share was $0.16, which also missed the estimate for a net loss per share of $0.14. The company said that core revenue (defined as non-nicotine revenue) grew 14.9% to $34.5 million versus last year’s $30.0 million.

“Our second quarter 2021 results reflect the success of our efforts to drive growth in our core business lines and higher-margin Greenlane brands,” said Aaron LoCascio, Greenlane’s Chairman and Chief Executive Officer. “I am proud of our accomplishments and want to thank our entire team for their ongoing dedication as we execute on the opportunity ahead. During the quarter, we drove solid Greenlane Brands revenue growth, up 62% year over year and representing 26% of our total Q2 revenue, supported by strong organic growth.”

The company continues to make efforts to lessen its dependence on nicotine products like Juul that fueled the company’s early growth. Greenlane said its net sales included negligible nicotine revenue compared to the prior-year period. Core revenue accounted for 99.3% of the quarter’s total revenue.

Mr. LoCascio added, “Our focus on growing our portfolio of owned brands and driving strong performance from our existing brand portfolio, combined with our pending merger with KushCo, has positioned our business to be the leader in the ancillary cannabis space and to build strong, long-term value for both our customers, partners, employees, and shareholders.”

Greenlane said that cash totaled $11.6 million as of June 30, 2021. As of June 30, 2021, working capital was $36.4 million, compared to working capital of $54.2 million, as of December 31, 2020. After the quarter ended, the company completed a $32.0 million registered direct offering priced at the market.

PACT Act

Greenlane also addressed the issue of the “Consolidated Appropriations Act, 2021,” when Congress amended the Prevent All Cigarette Trafficking Act (“PACT Act”) to apply to electronic nicotine delivery systems (ENDS). The PACT Act prohibits the use of the U.S. Postal Service to deliver ENDS. The PACT Act also requires that sellers of ENDS implement certain age verification measures for direct-to-consumer sales, register with the Bureau of Alcohol, Tobacco, Firearms and Explosive and the tobacco tax administrators of the states into which shipments are made, and file monthly reports demonstrating payment of applicable taxes.

The company said in its filing, “Additionally, possibly as a result of the PACT Act amendments, FedEx and UPS adopted policies banning the shipment of vaping products starting on March 1st, 2021, and April 5th, 2021, respectively. Substantial uncertainty exists regarding which products may not be shipped pursuant to the PACT Act and the policies of FedEx and UPS. In the event, USPS determines that the mail ban applies broadly to all or almost all vaporizers, and FedEx and UPS continue to maintain restrictive shipping policies, our shipping costs will be adversely and materially impacted, and we could lose our ability to deliver products to customers in a timely and economical manner. We are unable to determine the extent of the impact to the business until further guidance and clarification is issued.”

Greenlan said it believes it is well-positioned in comparison to its competitors and may derive several advantages from the amended PACT Act. “We already maintain the required state licensure and have a compliance infrastructure that is already being utilized to satisfy the PACT Act’s requirements. In contrast, some of our competitors do not currently have the required licensure and may have to devote significant resources to achieve compliance with the PACT Act, if they can achieve compliance at all. Moreover, our shipping volumes enable us to obtain relatively favorable terms with private carriers who permit the shipment of ENDS. Additionally, our compliance and logistics capabilities also allow us to offer fulfillment services to companies that cannot or do not wish to directly ship ENDS to customers, potentially creating an additional revenue stream. Finally, we are well-positioned to take advantage of other opportunities that may arise, including favorable acquisition valuations from companies that are unable to comply with the PACT Act and the ability to attract customers from competitors who cannot be able to ship vaporizers compliantly.”


Debra BorchardtJuly 30, 2021
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Greenlane Holdings, Inc.  (Nasdaq: GNLN) announced preliminary financial results for its second-quarter ending June 30, 2021, but gave little detail. Greenlane said it had net sales of $34.5 million and that the gross margins were between 21% and 22%. Greenlane delivered $34 million in revenue for the first quarter of 2021 making the sequential growth to be basically flat. The total cash balance is roughly $11.5 million.

However, the company recalled its March proforma outlook for the calendar year ending in December. Greenlane blamed headwinds created by uncertainty in its supply chain and lingering impacts of Covid-19. The company said it expects to reestablish a pro forma outlook at a later date. In March, Greenlane had suggested that the combined company would have “pro forma revenue of over $250 million for the year ended December 31, 2020, and a pro forma market capitalization in excess of $350 million based on the respective share prices of Greenlane and KushCo (OTC: KSHB) as of market close on March 30, 2021. Following completion of the Transaction, the combined company is expected to generate pro forma revenue of between $310 million and $330 million for the year ended December 31, 2021.”

Greenlane also said it continues to expect the proposed merger with KushCo Holdings will close in the third quarter of 2021, subject to the satisfaction or waiver of all remaining conditions in the agreement, including the receipt of all necessary approvals.

KushCo recently reported its earnings on July 8 where the company said it had revenue of $28.3 million, or 27% year-over-year growth, in fiscal Q3 2021, driven by increased sales to the company’s top 25 customers, including leading multi-state operators (“MSOs”) and licensed producers (“LPs”). SG&A expenses were approximately $9.1 million, compared to $12.7 million in the prior-year period. The decrease was primarily driven by reductions in headcount, bad debt expense, consulting spend, and stock compensation expenses, largely as a result of the COVID-19 pandemic and the Company’s implementation of the 2020 Plan.

At the time, Nick Kovacevich, KushCo’s Co-founder, Chairman and Chief Executive Officer said, “”Our gross margins for fiscal Q3 continued to reflect the uncontrollable shipping delays we, and other importers of goods, have been experiencing for the past couple of quarters. Even though the situation has somewhat improved since the end of 2020-where there were record-breaking shipments during the holiday season, severe COVID-19-related restrictions at domestic ports and a global shortage of containers-a significant percentage of all products coming from overseas continue to experience delays, resulting in higher freight costs across the board. In addition, we experienced lower direct material margins on several of our products, as we cycle through higher-priced inventory and continue to work with our vendors to obtain more favorable pricing.”


Debra BorchardtMay 18, 2021
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 Greenlane Holdings, Inc. (Nasdaq: GNLN) reported financial results for the first quarter ended March 31, 2021, as total revenue increased 0.4% to $34.0 million versus $33.9 million for the same time period a year ago. Greenlane missed the Yahoo Finance average analyst estimate for revenues of $39 million. Net losses were trimmed to $7.7 million from last year’s $16.7 million for the same time period. The net loss per share was  ($0.28), which was lower than last year’s ($0.43) but was way off from the estimate for ($0.05)

Net sales in the first quarter were significantly less reliant on nicotine revenue, as Greenlane continues to focus on core (non-nicotine) sales and higher-margin products, including Greenlane Brands. Greenlane Brands sales grew 9.4% from the fourth quarter to $8.5 million in the first quarter and 18.4% year-over-year. The company said that VIBES performed exceptionally well during the quarter and achieved a quarterly sales revenue record of $2.7 million, a 72.8%, increase over last year. Greenlane Brands accounted for 25.1% of total revenue in the first quarter.

“Our first quarter 2021 results demonstrate our continued forward momentum on the heels of a successful 2020,” said Aaron LoCascio, Greenlane’s Chairman and Chief Executive Officer. “This quarter saw significant progress on the execution of one of our key growth strategies, with the acquisition of Eyce, further adding to our portfolio of premium owned brands and the announcement of our impending transformative merger with KushCo. During the quarter we also saw further proof our strategy to focus on growing our portfolio of owned brands is delivering significant results as we transition away from lower-margin revenue categories, with our Greenlane Brands accounting for a quarter of our revenue in the first quarter of 2021. The continued improvement in revenue mix backed by our robust pipeline of potential acquisitions and continued organic growth, combined with our pending merger with KushCo we believe will strongly position us as the leader in the cannabis ancillary space as we drive further revenue growth and profitability improvements in 2021, and continue to build value for both shareholders and customers.”

The company though burned through quite a bit of cash during the quarter. As Of the end of March, cash totaled $12.3 million a drop of approximately $30.4 million at the end of December 2020. Greenlane said this was due in large part to payments to vendors decreasing its accounts payable by $10.2 million over the period, payments to European tax authorities totaling $2.7 million, and $2.4 million in cash paid as partial consideration for the acquisition of Eyce. As of March 31, 2021, working capital was $43.0 million, compared to working capital of $58.2 million as of December 31, 2020. On a positive note, the company received a refund from the Dutch tax authorities of approximately $4.1 million in April 2021

PACT Act Uncertainty

The company said in its filing that as a result of the PACT Act amendments, FedEx and UPS adopted policies banning the shipment of certain vaping products starting on March 1st, 2021, and April 5th, 2021, respectively. “Substantial uncertainty exists regarding which products may not be shipped pursuant to the PACT Act and the policies of FedEx and UPS. In the event USPS, FedEx, or UPS determine that their bans apply broadly to all or almost all vaporizers, our shipping costs will be adversely and materially impacted, and we could lose our ability to deliver products to customers in a timely and economical manner. We are unable to determine the extent of the impact to the business until further guidance and clarification is issued.”

Despite the PACT Act, Greenlane believes it is well-positioned and may derive several advantages from the amended PACT Act. “We already maintain the required state licensure and have a compliance infrastructure that is already being utilized to satisfy the PACT Act’s requirements. In contrast, we believe many of our competitors do not currently have the required licensure and may have to devote significant resources to achieve compliance with the PACT Act if they can achieve compliance at all. Moreover, our shipping volumes enable us to obtain relatively favorable terms with private carriers who permit the shipment of ENDS. Additionally, our compliance and logistics capabilities also allow us to offer fulfillment services to companies that cannot or do not wish to directly ship ENDS to customers, potentially creating an additional revenue stream.”

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Debra BorchardtMarch 31, 2021
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Cannabis accessories e-commerce company Greenlane Holdings, Inc. (Nasdaq: GNLN)  reported financial results and announced a merger with KushCo sending the stock higher in early trading. Greenlane stock was up over 17% on news of the merger as the company missed revenue estimates for the fourth-quarter ending in December.

Net sales grew approximately 50.5% to $7.8 million, or 21.4% of total net sales in the fourth quarter versus $5.2 million or 13.8% of net sales in the fourth quarter of 2019. Core revenue grew 11.3% to $33.9 million in the quarter versus $30.5 million for the same time period in 2019. Greenlane missed the average analyst estimate which was for revenue of $36 million according to Yahoo Finance. Core revenue is defined as all non-nicotine revenue and Greenlane Brand revenue is inclusive of Eyce figures. The net loss for the quarter grew 8.9% to $10.8 million.

For the full year, total revenue was $138.3 million versus $185.0 million for the fiscal year 2019. The full-year 2020 core revenue (defined as non-nicotine revenue) grew 12.7% to $125.2 million versus $111.1 million in 2019. The net loss grew 19.8% to $47.7 million over last year’s net loss of $39.8 million. The decrease in sales was driven by a strategic decision to move away from sales of higher volume, lower margin merchandise to higher-margin revenue opportunities, including the Greenlane branded products.

“Though this year has been very challenging, I am incredibly proud of how the Greenlane team has aligned to accomplish all we have achieved in 2020,” said Aaron LoCascio, Greenlane’s Chairman and Chief Executive Officer. “Together, we successfully refocused our strategic efforts to grow our portfolio of owned brands, brought in new senior leaders, and took decisive steps to move away from lower-margin revenue categories that has positioned us for sustained, long term growth.”

Mr. LoCascio added, “As we enter 2021, Greenlane will continue to innovate and adapt to meet the demands of the rapidly evolving Cannabis industry by executing on our growth strategy. This includes continuing to improve our revenue mix with a focus on Greenlane branded products, further optimizing our organizational structure to reduce costs where appropriate and leveraging our best-in-class global distribution platform to launch innovative new products into the market. We have made great progress thus far, and recently announced our acquisition of the Eyce, the world leader in premium silicone smoking products and a Greenlane partner for over seven years.”

KushCo Merger

Along with the announcement of earnings, Greenlane also said it was merging with cannabis packaging company KushCo (OTC: KSHB). The exchange ratio is expected to result in KushCo stockholders owning approximately 49.9% of the combined company’s common stock and Greenlane stockholders owning approximately 50.1% of the combined company’s common stock. The company said the deal is expected to generate approximately $15 million to $20 million of annual run-rate cost synergies within 24 months from the closing.

KushCo’s Co-Founder, current Chairman, and Chief Executive Officer, Nick Kovacevich, will lead the combined company as Chief Executive Officer, and an Independent Chairman of the Board will be appointed at a later date. Greenlane’s Bill Mote will serve as Chief Financial Officer, with Greenlane Co-founder Aaron LoCascio serving as President and Greenlane Co-founder Adam Schoenfeld serving as Chief Strategy Officer. The combined company will be headquartered in Boca Raton, Florida with a significant footprint in Southern California.

“This transformative transaction is expected to create a broad and complementary platform that we expect to deliver substantial synergies at an important inflection point in the cannabis industry,” said Aaron LoCascio, Chief Executive Officer and Co-Founder of Greenlane. “As an industry leader, the combined company will be well positioned to grow profitability and maximize value for all stockholders while also providing enhanced product offerings and expanded ancillary services to our valued customer bases. We are thrilled to be working with the talented and experienced KushCo team, and together we will continue to drive innovation and excellence in the space. Since Greenlane’s founding in 2005, we have been at the forefront of the cannabis industry, and today we take the next step in our continued evolution.”

“We’re excited to create a leading, innovative supplier of cannabis ancillary products serving the most valuable segments of the supply chain,” said Nick Kovacevich, KushCo’s Co-founder, Chairman, and Chief Executive Officer. “For more than 10 years, KushCo has proudly pioneered this industry, creating substantial value for our customers, employees, partners, and stockholders. Now, we have reached a critical time in our industry where the leading operators are increasingly looking to partner with companies in the ancillary space who can reliably support their rapid expansion for years to come. We greatly admire the product portfolio that the Greenlane team has built, and we are excited to work with them to cross-sell to our complementary customer bases and execute on the attractive growth opportunities ahead.”


StaffMarch 4, 2021
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This week has been unusually active as cannabis companies have been on a major buying spree.

Schwazze

Schwazze, which used to be known as Medicine Man Technologies Inc. (OTCQX: SHWZ)  closed on the asset purchase of the five Star Buds dispensaries located in Colorado that it had not already previously bought. The acquired dispensaries are located in Aurora (2), Denver, Louisville, and Westminster. The company paid roughly $72.3 million, consisting of $27.5 million in cash, $26.9 million in sellers’ notes, and $17.9 million in Preferred Stock (at a price of $1,000 per share). Schwazze now owns and operates all 13 Star Buds locations in Colorado and its retail footprint now includes 17 dispensary locations in the Denver metro and southern Colorado region.

For 2020, the 13 Star Buds retail dispensaries generated total revenue of approximately $70 million and net income in the range of approximately 40% of revenue. Together with Schwazze and the proforma revenue for 2020 Mesa Organics Ltd, acquired by Schwazze in April 2020, total 2020 proforma revenue is estimated to be approximately $95 million on a combined basis.

Greenlane

Greenlane Holdings, Inc. (Nasdaq: GNLN) has bought the specialty silicone smoking accessory company Eyce for an undisclosed amount. The company said that the acquisition is expected to be immediately accretive to Greenlane’s revenue and earnings.

“Eyce is the definitive leader in premium silicone smoking products and a trusted Greenlane partner for more than seven years. We are very excited to welcome them as the newest addition to our in-house family of brands,” said Aaron LoCascio, Co-Founder and CEO of Greenlane. “Eyce’s premium products and innovative designs set them apart and we are thrilled to be working with the highly experienced and talented Eyce team to accelerate growth in the Greenlane brands portfolio.”

Mr. LoCascio continued, “The Eyce acquisition represents the latest step in Greenlane’s relentless focus to find and acquire the highest quality brands and platform extensions in the cannabis market to further drive our revenue growth and profitability and deliver value to our shareholders. We have carefully built a robust pipeline of targets and we intend to add additional brands to our portfolio in the near term as we continue to execute on this growth plan.”

Charlie Hoch, CEO of Eyce, added, “Greenlane has been an incredible partner over the years and their platform has been instrumental in enabling us to rapidly launch products into the market and build scale. We are thrilled to be joining the team and continuing to work together to accelerate development of the innovative products our customers demand.”

Terra Tech

Terra Tech Corp. (OTCQX: TRTC) said it was buying cannabis company  UMBRLA, Inc., which was recently rebranded as Unrivaled for an undisclosed amount. Unrivaled is a swiftly growing and well-run diversified cannabis company comprised of several highly recognized cannabis brands complemented by distribution, manufacturing, and dispensary operations. Unrivaled brands include Korova, a top ten cannabis brand in California, among a strong portfolio across categories and price points.

Terra Tech’s CEO, Frank Knuettel II, said, “We are very pleased to have entered into this mutually beneficial transaction which leads to immediate scale, driven by strong brands and revenue growth. Unrivaled has grown markedly since inception, led by a strong management team, including Dallas Imbimbo, co-founder of KushCo Holdings, Inc. (OTCQX: KSHB) and Unrivaled. We intend to integrate Unrivaled’s management team into Terra Tech, whose robust leadership is capable of executing on high revenue growth and additional accretive acquisitions.”

Unrivaled operates manufacturing and distribution operations in both California and Oregon and dispensaries in California. Unrivaled owns and manages one of the largest distribution networks on the west coast with over 700 in-network dispensaries throughout Oregon and California, into which Unrivaled sells both its own brands and third-party brands across all major categories: flower products, vape cartridges, extracts, and edibles.

Knuettel added, “Following the restructuring of our balance sheet and bringing in new capital in January, this is the first of our anticipated strategic acquisitions building on the foundation formed by my predecessors. Our short-term goal is to become the premier West Coast and Southwest operator of cannabis assets with a focus on brands and dispensaries. Based on our growth trajectories and new operations coming online during 2021, we believe that the combined companies will generate revenues in excess of $70 million in 2021.”

Unrivaled CEO Dallas Imbimbo said, “Over the last two years Unrivaled has brought together some of the most well-respected brands in cannabis with Korova, LTRMN, Sticks, Cabana and The Spot. Terra Tech’s retail and cultivation assets perfectly complement Unrivaled’s modern brand portfolio, sophisticated R&D and state-of-the-art tech stack. Our mission continues to become the leading-edge global cannabis operator, and this merger will accelerate that path significantly. We would like to give a huge thank you to the Unrivaled team for their dedication and relentless pursuit of our goals.”

 


Kaitlin DomangueDecember 11, 2020
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Today’s gift guide is all about glass pieces. Glass deserves a category all to itself, the gifts we have on this list are very unique. If you know a glass connoisseur, this is the guide you’ll want to read. There is something for every budget on this list, as well as a product for (most) people who like to use glass.

KHaring x Higher Standards

We featured a KHaring glass rolling tray in the gadgets and accessories guide, but Keith Haring’s art can also be purchased on glass pieces! The KHaring line has multiple different tools, and you can choose from a few different pictures. Choose between a KHaring rig, pipe, bubbler, water pipe, and taster pipe. 

Keith Haring’s artwork is known for being a little bit obscure, so this is the perfect gift for someone that appreciates all things art, and ideally, all things unique. Keith Haring was also an activist and often used his artwork to spread messages that were important to him. “A social activist and creative visionary, Haring used his artwork to spread messages of peace, love, equality, and compassion,” reads the website. The taster starts at just $20, and the water pipe is the most expensive at $160, so there is something for every budget! 

Petal Pipe by Elevate Jane

This is a gorgeous and feminine pipe with amber-colored glass, created by Elevate Jane. Elevate Jane is owned by Angela Mou, a female entrepreneur of color with her sights on disrupting the cannabis space – in all of the best ways.

The pipe features pretty pink flower petals on the inside, which are not painted on, but rather expertly blown. This ensures the integrity of the flower petals, they won’t fade away like painted on petals would. It is handblown, so you can trust that your pipe was created with the utmost love! 

This beautiful piece retails for $69 and may require the signature of someone 21+ years upon delivery. 

Marley Natural Glass & Walnut Spoon Pipe

This is a gorgeous piece for people who just love the classics. Whether that’s classic style, movies, or music – your cannabis loving recipient will appreciate the simplicity of this glass and walnut spoon pipe by Higher Standards. The parts are detachable which makes for easy cleaning and maintenance. It retails for $60, so it is fairly affordable for a product of such high quality and class. 

Crystal Pipe by Elevate Jane

We are going to talk about Elevate Jane again, because they are coming through for us with the glass pieces. Elevate Jane’s crystal pipes are gorgeous, and some believe crystal provides helpful properties to encourage healing and restoration. Elevate Jane offers so many different kinds of crystal pipes, choose from: clear quartz, tourmalinated crystal, rose quartz, amethyst crystal, green aventurine, labradorite crystal, smoky quartz, and black obsidian. They are all so different looking, so head to Elevate Jane’s crystal pipes to choose the best one for your recipient! 

Stundenglass Gravity Hookah

Okay, so this is the gift you give to your person. Whether that’s your partner, your best friend, your mom, or yourself – this is the big one. You don’t give a Studenglass gravity hookah to just anyone. It was just released, so it is a brand new gift. Vape and smoking accessories company, Greenlane Holdings (NASDAQ: GNLN), is the exclusive distributor for the Studenglass gravity hookah. 

This multi-use tool retails for $500, but for a great reason. It is a 3-in-1 design, offering multiple uses including a hookah, concentrate, and dry herb consumption. It is also compatible with concentrate accessories such as the G Pen Connect. Accessories like the G Pen are connected through an included male-to-male adapter. 

“We are thrilled to introduce Stündenglass to our dynamic customer base,” said Aaron LoCascio, Founder and Chief Executive Officer of Greenlane Holdings. “The Stündenglass team has exhibited great ingenuity in developing their flagship Gravity Hookah and the result is one of the most technologically-advanced smoking accessories in the industry. We hope to improve the overall consumption experience for our customers around the world through this launch.”

Food Pipes by Elevate Jane

Elevate Jane’s food pipes are perfect for any cannabis enthusiast that loves, well… food! The pipes from the women-owned brand are so cute, choose from pieces shaped like an avocado, an eggplant, an ice cream cone, delicious-looking sushi, and other fun pieces. They add a little bit of fun to the smoking session, and they are really pretty, too. 


Debra BorchardtNovember 17, 2020
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The smoking accessory e-commerce giant Greenlane Holdings, Inc. (Nasdaq: GNLN) reported that its net sales fell 20% to $35.8 million in the third quarter ending September 30, 2020 versus $44.9 million in the 2019 third quarter. This narrowly topped the Yahoo Finance analyst estimates for revenue of $35.7 million.

The net loss for Greenlane was $13.7 million versus a net loss of $8.9 million in the 2019 third quarter. The company also delivered a loss per share of ($0.35) which missed the analyst estimates for a loss per share of ($0.10).

Greenlane attributed the drop in revenue is largely attributable to the company’s decision to move away from low-margin nicotine sales typically JUUL pods, to focus on higher-margin products. On a sequential basis, Q3 2020 net sales increased 10% from $32.4 million in the second quarter of 2020. Sales of nicotine products decreased to approximately $3.5 million in the third quarter, from approximately $21.1 million in the same time period of 2019. Net sales of Greenlane branded products grew to approximately $5.6 million, representing 15.5% of total revenue in the third quarter of 2020, as compared to approximately $3.4 million in the third quarter of 2019, or 7.5% of total revenue.

“During the third quarter, with the help of our new senior leadership team, we acted on several key initiatives related to our go forward category emphasis, organizational structure, and related staffing levels. Building on the success we’ve achieved in growing Greenlane brands and non-nicotine sales year over year by 65% and 36%, respectively, we’ve taken additional decisive steps to de-emphasize certain product lines, invest in our fastest growing and highest margin opportunities, and further reduced our headcount by 4.5%,” said Aaron LoCascio, Greenlane’s Chairman and Chief Executive Officer. “While this has had an impact on our Q3 financials, we believe these decisions have positioned Greenlane to return to near-term profitability and long term success.”

Cutting Expenses

Greenlane is sitting on top of $40.0 million in cash and had total debt was $8.2 million as of September 30, 2020, compared to $47.8 million and $8.3 million, respectively, as of December 31, 2019. Year to date, cash used in operating activities was $3.8 million, compared to $33.5 million in the prior year, an 89% improvement. Greenlane said it continues to actively manage its balance sheet to fund its growth initiatives and potential M&A opportunities.

Benefits of Branding

In the third quarter, gross profits were $2.5 million, or 6.9% of net sales, compared to $6.4 million, or 14.3% of net sales in the third quarter of 2019. The company recorded write-offs and adjustments of $4.8 million to damaged and obsolete inventory. Excluding the impact of these inventory adjustments, gross margin would otherwise have been $7.3 million and gross profit margin would otherwise have been 20.4% or 610 basis points higher than the  2019 gross profit. Greenlane expects the overall gross margin to expand from the current adjusted levels of 20.4% as it executes on its strategic vision with Greenlane Brands at its core.

Mr. LoCascio added, “We are building a comprehensive suite of high-quality, Greenlane branded products which will enable us to capture more of the margin on each product we sell. At the same time, we continue to work very closely with our brand partners to launch innovative new products into the market leveraging our best-in-class global distribution platform. I remain very encouraged that we are on track to enter 2021 on a solid footing, returning to positive adjusted EBITDA in the first quarter as a result of the changes we have implemented.”


Debra BorchardtJune 4, 2020
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Smoking accessories e-commerce brand Greenlane Holdings, Inc. (GNLN) reported falling revenue for the first quarter ending March 31, 2020. Net sales fell 32% to $33.9 million in the first quarter of 2020 versus $49.9 million for the same time period in 2019.

Greenlane blamed the drop on the FDA’s restriction on the sale of certain products, primarily mint-flavored JUUL, and the execution of Greenlane’s plan to deliberately move away from low-margin JUUL sales, to focus on higher-margin products. The company also delivered a  first-quarter net loss of $16.8 million, slightly better than last year’s net loss of $17.7 million for the same period in 2019. The company also took a $9 million goodwill impairment charge in the quarter.

“We have made significant strides in the execution of our business transformation plan and are focused on pursuing higher-margin revenue opportunities while strategically right-sizing our operations to the current environment,” said Aaron LoCascio, Greenlane’s Chairman and Chief Executive Officer. “We’re beginning to see the positive impact of the investment we made to develop and launch our Greenlane Brands, which accounted for a record 18.5% of net sales and drove the sequential improvement in our gross margin.”

JUUL Drops

The popular candy-flavored vape product JUUL came under fire for its targeted approach to teens and young adults. The fallout was that sales decreased for Greenlane to roughly $4.4 million in the quarter, from approximately $21.0 million in the first quarter of 2019. The company has switched its focus to Greenlane Brands whose net sales grew to $6.3 million dollars or 18.5% of total revenue in the first quarter of 2020 versus $4.6 million in the first quarter of 2019.

The Greenlane Brands category is made up of child-resistant packaging innovator Pollen Gear; VIBES rolling papers; the Marley Natural accessory line; the Keith Haring Collection accessory line; Aerospaced & Groove grinders, and Higher Standards, which is both an upscale product line and an innovative retail experience with flagship stores at New York City’s Chelsea Market and in Malibu, California.

The company said that net sales of its third-party brands, including Firefly, Santa Cruz Shredder, and MJ Arsenal increased by approximately $1.2 million in Q1 2020 as compared to Q1 2019.

Company Shifts

Greenlane clearly saw the writing on the wall and moved quickly to adapt to the changing landscape with regards to losing its cash cow in JUUL. The company closed its brick-and-mortar retail store in Ponce City Market. In addition, Greenlane closed its Schenectady, NY, and Delta, Canada distribution centers on May 14, 2020, and May 15, 2020, respectively, and expects to close its Jacksonville, FL, Torrance, CA, and Visalia, CA distribution centers in June 2020. The company did enter into a new lease agreement for a new retail store located in Barcelona, Spain, which opened to the public on May 26, 202

Salaries, benefits, and payroll taxes in the quarter decreased to $1.5 million, or 18.2% due to a decrease in equity-based compensation expense of $2.5 million. The company also said it had a targeted reduction of approximately 50 employees which is expected to positively impact its results in future quarters

Cash and cash equivalents were $43.9 million and total debt was $8.3 million as of March 31, 2020, compared to $47.8 million and $8.3 million, respectively, as of December 31, 2019.


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