iAnthus Archives - Green Market Report

Debra BorchardtDebra BorchardtSeptember 29, 2020
moneyhand-scaled.jpg

7min26060

Editors note: This story was updated on 9/29/2020.

Just two weeks ago, iAnthus Capital Holdings, Inc. (OTCQX: ITHUF) announced that, at the meetings of Secured Noteholders, Unsecured Debentureholders and Existing Equityholders voted overwhelmingly in support of the previously announced recapitalization transaction to be implemented by way of a court-approved plan of arrangement under the British Columbia Business Corporations Act. The hearing was planned for September 25, 202. The stock was halted for trading this afternoon.

According to a post on Twitter on Monday by Andro George, the plan was dismissed. George has been working with shareholders to claim that the assets are more valuable than what is being presented in court. It seems iAnthus was offering common shareholders 2.75%, while they believe they should get something in the ballpark of 25%-32.5%.

On Tuesday iAnthus released an announcement saying “Justice Gomery held that the Plan of Arrangement was put forward in good faith and met the statutory requirements of the British Columbia Business Corporations Act (the “BCBCA”). Justice Gomery was also satisfied that the Plan of Arrangement had a valid business purpose and was approved by the security holders in accordance with the requirements of the BCBCA. The Plan of Arrangement included a release of claims and Justice Gomery did not approve the form of release of claims presented to the Court.  Accordingly, Justice Gomery will have conduct of the matter and has not made a final ruling on the fairness of the Plan of Arrangement.”

“Under the RSA, iAnthus is obligated to pursue the Recapitalization Transaction under the Companies’ Creditors Arrangement Act (“CCAA”) within five business days if the final court order for the Plan of Arrangement was not granted by September 28, 2020. The parties to the RSA have agreed to extend the Deadline to Tuesday, October 6, 2020.”

iAnthus Background

iAnthus’ problems began in April when Chief Executive Officer Hadley Ford has resigned from his position after an investigation by the board’s special committee. The company’s President and Co-founder Randy Maslow was appointed as the interim CEO effective immediately.

The company formed a special committee to look into allegations made in an online media report that Hadley had misused company funds for his own benefit and that there was a conflict of interest. The committee determined that two of the allegations were substantiated and recommended further action. According to a company statement, the Special Committee determined that Ford entered into two undisclosed loans with iAnthus’ senior secured lender, Gotham Green Partners (one loan for $100,000 with a related-party and the other for $60,000 with a non-arm’s length party) and those loans created a potential or apparent conflict and should have been disclosed to the board in a timely way.

In August, the company reported a staggering net loss of $237.3 million, which included a $199.4 million impairment loss. While the revenue rose 12% sequentially to $30.4 million, the net losses and defaulting on debt payments have overshadowed any good news.

iAnthus said in its earnings statement that it did not make interest payments due on its Secured Notes and Unsecured Debentures due on March 31, 2020. “This non-payment of interest triggered an event of default with respect to these components of the Company’s long-term debt, consisting of principal amounts at face value of $97.5 million and $60.0 million and accrued interest amounts at March 31, 2020, of $3.2 million and $1.2 million on the Secured Notes and Unsecured Debentures, respectively.”

At this point, the credit Gotham Green Partners (GGP) demanded its debt payments or it was taking over the company and leaving the common shareholders with very little. Obviously, the shareholders felt that a lender that cared about the company would give it more time to pay and restructure the debt. The shareholders were told that if they didn’t vote for the recapitalization plan giving GGP most of the company then they would get almost nothing. Many voted against the plan, but iAnthus said 68% voted in favor.

Andros George contested the shareholder voting amounts and noted that he believed that not enough shareholders had voted in favor and that the CEO could not vote those shares by proxy. He believed he had 25% of the shareholders voting against the plan. He suggested the GGP was a predatory lender and that the executives of iAnthus were not acting with the best intent for the shareholders.

Shareholders have pointed to improving earnings in the first quarter with reported revenues up 12% from the prior quarter. They have also pointed to other cannabis company acquisitions with similar assets, suggesting that if iAnthus sold some assets it could address its debt issues.

This story is developing and will be updated as more information is released.

 


Julie AitchesonJulie AitchesonAugust 26, 2020
union.jpg

7min5390

With unionization becoming ever more common in the cannabis industry, Labor Day 2020 provides an opportunity to take a closer look at the state of cannabis labor unions in the U.S.  Across industries, labor unions organize members and offer access to group health insurance, provide legal compliance and other assistance, help negotiate annual raises and higher wages, and often provide discounts through partner businesses. The International United Food and Commercial Workers Union (UFCW- working not just in the representation of businesses, but advocacy, coalition-building, and policy change), is regarded as the most powerful cannabis union in the country, initiating a Cannabis Workers Rising Campaign in 2010. As of March 2020, UFCW represented more than 10,000 workers in 14 states.

United Cannabis Workers, which “unionized as an independent workers union made up of small business owners, self-employed workers, and employees of small cannabis businesses”, eschews “old school union tactics” while holding a significant place in the cannabis union landscape. This landscape is differentiated from that of other industries in that it normalizes companies disclosing the fact that their employees are organizing. In cannabis, unionization is frequently seen as a way for a business to demonstrate legitimacy, however not all companies are supportive of unionizing efforts.

Michigan

In January of this year, controversy broke out over proposed labor union laws for cannabis businesses in Michigan, put forward by the state’s Marijuana Regulatory Agency. The proposal included a requirement that cannabis companies enter into “labor peace agreements” with unions before being licensed to grow, sell, or distribute cannabis. This suggested rule was met with significant opposition by industry groups and businesses, many going so far as to claim the measure thinly disguised political favor and a protection racket. This June, Michigan’s pro-union “labor peace agreement” requirement was stripped out of the proposal after a deluge of negative feedback. Many who oppose labor union laws such as these claim a violation of The National Labor Relations Act, which guarantees private-sector employees the right to form labor unions and gives unionized employees the right to strike and bargain jointly for working conditions. Opponents see labor peace agreements as “a pretense to use industry licensing to impose forced union dues on workers in violation of federal labor law.”

Supporters argue that labor peace agreement requirements result in a more stable workforce for the cannabis industry. In New York and California (where cannabis labor unions are required) cannabis industry workers are commonly acknowledged as ripe for exploitation by unethical businesses and therefore in need of union protection, while companies in states such as Michigan and Massachusetts have pushed back against unionization efforts. New England Treatment Access, one of Massachusetts’ largest cannabis companies, has been on the receiving end of numerous complaints filed by UCFW alleging anti-union efforts and retaliation against workers.   In July, about 60 New England Treatment Access, (NETA) workers in Franklin, Mass., voted to join UFCW Local 1445. With so much at stake and so much still unresolved in the cannabis regulatory sphere, cannabis labor unions and industry companies will no doubt continue this dance of compromise and conflict for many Labor Days to come.

Also in July, the Cannabis Workers Union said that 40 workers from Mayflower Medicinals joined UFCW Local 1445 because they were concerned about insufficient wages, as well as an unclear and slow response to workplace safety issues by the company in relation to the current COVID-19 health crisis, and a lack of respect by management for the work that they do at the company’s grow facility. Mayflower Medicinals is owned by iAnthus Capital Holdings, Inc. (OTC:ITUHF).

“As the cannabis industry continues to grow in Massachusetts, UFCW Local 1445 is proud to support these good jobs and the responsible employers that empower their workers in this new part of our economy,” said UFCW Local 1445 President Fernando Lemus. “These workers at Mayflower/IAnthus are an important role in the company’s success and they deserve the protections and security of a union contract.”

Vireo Health Supports Unions

In January this year, Vireo Health International, Inc. (CNSX: VREO)(OTCQX: VREOF) announced that its workers at its wholly-owned subsidiary, MaryMed, LLC  voted overwhelmingly to ratify a Collective Bargaining Agreement and officially joined the ranks of United Food and Commercial Workers Local 27 (UFCW27).

The company said that the three-year agreement would be the first medical cannabis union contract ratified in the State of Maryland. The contract would cover employees working in Vireo’s 20,000 square-foot Hurlock, Maryland-based manufacturing facility, which supplies precisely formulated medical cannabis products to third-party dispensaries throughout the state.

“As a ‘people-first’ business, Vireo is deeply committed to our employees and we are proud to be a union employer in Maryland and beyond,” said Kyle Kingsley, M.D., CEO of Vireo Health. “Our workforce is key to our company’s success and we look forward to partnering with UFCW to support legislation, such as legalizing adult-use cannabis, that will help create thousands of new middle-class jobs across Maryland.”

 


Debra BorchardtDebra BorchardtAugust 14, 2020
ianthus3.jpg

4min4916

iAnthus Capital Holdings, Inc. (OTCQX: ITHUF) reported a staggering net loss of $237.3 million, which included a $199.4 million impairment loss. While the revenue rose 12% sequentially to $30.4 million, the net losses and defaulting on debt payments have overshadowed any good news.

The net loss per share was $1.38 versus last year’s net loss of $0.19. The majority of the impairment losses were from the Arizona and Nevada properties, $86 million, and $64 million respectively.

iAnthus said in its earnings statement that it did not make interest payments due on its Secured Notes and Unsecured Debentures due on March 31, 2020. “This non-payment of interest triggered an event of default with respect to these components of the Company’s long-term debt, consisting of principal amounts at face value of $97.5 million and $60.0 million and accrued interest amounts at March 31, 2020, of $3.2 million and $1.2 million on the Secured Notes and Unsecured Debentures, respectively.”

The company has an accumulated deficit of $622 million according to the filing. On July 10, the company entered into a Restructuring Support Agreement with some of its lenders. “If the Recapitalization Transaction is completed through CCAA Proceedings, then the Existing Shareholders (defined as the existing holders of Common Shares) will not receive a recovery.” In other words, the shareholders lose everything.

Trading Resumption Requested

The company has requested an extension for reporting its second-quarter earnings due to logistical issues and delays caused by COVID-19. The company has until October 15, 2020 to file those earnings. The company has been affected by a cease trade order that started on June 22 for failure to file financial results and now that the fiscal first quarter has been released, iAnthus is asking for the cease trading order to be revoked.

The stock has continued to trade on the OTC Markets, where it was lately selling at $0.06 a share. Its 52-week high was $2.74 on that exchange.

Stavola Leaves

Beth Stavola sold her CBD for Life company to iAnthus in 2019 and became the Chief Strategy Officer and board member of the company. For the three months ending in March, CBD For Life reported sales revenues of $652 thousand and net losses of $3.6 million. The impairment loss was listed at $2.5 million. Stavola also engineered the MPX Bioceutical acquisition for iAnthus which caused the markets to dub her the $845 million woman. The company reported that MPX delivered revenues in the quarter of $15.7 million and a net loss of $192 million.

Stavola recently left the company and told Forbes that her role was much less hands-on than she expected. However, she managed to make sure she was paid before the company began experiencing financial troubles. The Stavola Trust Note of $10.8 million was paid in full on January 10, 2020.

 


Debra BorchardtDebra BorchardtApril 27, 2020
ianthus3.jpg

5min18520

iAnthus Capital Holdings, Inc. (OTCQX: ITHUF) Chief Executive Officer Hadley Ford has resigned from his position after an investigation by the board’s special committee. The company’s President and Co-founder Randy Maslow has been appointed as the interim CEO effective immediately.

Investigation

The company formed a special committee to look into allegations made in an online media report that Hadley had misused company funds for his own benefit and that there was a conflict of interest. The committee determined that two of the allegations were substantiated and recommended further action.

According to a company statement, the Special Committee determined that Ford entered into two undisclosed loans (one loan for $100,000 with a related-party and the other for $60,000 with a non-arm’s length party) and those loans created a potential or apparent conflict and should have been disclosed to the board in a timely way.

With respect to the loan with the related-party report that started everything suggested that Ford entered into an undisclosed loan transaction with the managing member of iAnthus’ senior secured lender, Gotham Green Partners.  The Special Committee considered the allegation and the relevant details, are summarized as follows:

  • On December 20, 2019, iAnthus and Gotham Green closed an additional US$36.15 million of senior secured convertible notes from Gotham Green and additional co-investors.
  • A day after the close of the Third Tranche, on December 21, 2019, Ford and the Managing Member (as lender), entered into a loan for the principal sum of $100,000 documented by an email. The loan bore no interest and was to be repayable on March 31, 2020. The loan has not been repaid.

The Special Committee said it did not find a basis to conclude that “Ford’s conduct in the face of the potential or apparent conflict impacted the terms, timing, or negotiations the Company had with the related-party or the non-arm’s length party.  Nevertheless, the Special Committee concluded, and the Board accepted, that the failure to disclose such personal loans to the Board was a breach of the Company’s conflict policies and other obligations as an officer and director of the Company.”

Elizabeth (Beth) Stavola, Chief Strategy Officer and director of iAnthus stated: “I look forward to working closely with Randy as interim CEO and the Special Committee as the Company explores strategic alternatives.” iAnthus has initiated a Strategic Alternatives Review Process and has hired Canaccord Genuity Corp. as its financial advisor.

Earnings Delayed

iAnthus has postponed the filing of its annual financial statements for the year ended December 31, 2019, to incorporate subsequent event disclosures as they relate to the company’s financial position. The earnings announcement had previously been scheduled for April 7, 2020. As a result of a change to the filing date, the Company’s earnings news release for the fourth quarter and full-year 2019, as well as the conference call for financial analysts and investors previously scheduled for April 7, 2020, is being rescheduled.

iAnthus owns and operates licensed cannabis cultivation, processing and dispensary facilities throughout the United States, providing investors diversified exposure to the U.S. regulated cannabis industry.

 


StaffStaffSeptember 30, 2019
daily_hit004-1280x533.png

4min6010

It’s time for your Daily Hit of cannabis financial news for September 30, 2019.

On The Site

iAnthus

Gotham Green Partners has invested an additional $20 million in iAnthus Capital Holdings, Inc. (CSE: IAN)(OTCQX: ITHUF) through the purchase of senior secured convertible notes. Green Gotham said it was part of a broader $100 million financing plan to support the buildout of all existing markets in which iAnthus currently operates.

iAnthus has been building its market share at a rapid pace. Over the past 16 months, Chief Operating Officer Pat Tiernan said in a statement that the company currently has 27 open dispensaries, 11 of which have opened in the last ten months and the company is aggressively working to open another 12 in the next six months. Tiernan added, “We are growing in each of our markets and are one of the only MSOs that has meaningful revenue in multiple states, including Arizona, Colorado, Florida, Maryland, Massa

PathogenDX

Arizona-based DNA testing technology company PathogenDx, Inc. announced $7.5 million in Series B funding. This latest investment round was led by Cresco Capital Partners with participation from Altitude Investment Management, Arcadian Investment Partners, Panther Opportunity Fund LLC, Salveo Capital, Flatiron Venture Partners, and other investors. PathogenDx was able to close this round of funding in just under three months.

PathogenDx wants to become the new standard in DNA-based testing through widespread adoption of its advanced microarray testing platform for the cannabis, hemp, agriculture, food, and beverage industries. PathogenDx’s technology can rapidly identify and detect up to 50 pathogens all in a single test, in 6 hours providing triplicate data per analyte for certainty in results with a simple and easy process. This additional capital raise will allow PathogenDx to continue expanding its breakthrough technology into food and agriculture testing while continuing to build on its leadership position with a current portfolio of domestic and international clients in the cannabis industry.

In Other News

High Tide

High Tide Inc. (CSE:HITI) (OTCQB:HITIF) an Alberta-based, retail-focused cannabis corporation enhanced by the manufacturing and wholesale distribution of smoking accessories and cannabis lifestyle products, has filed its financial results for the third fiscal quarter of 2019 ending July 31.

Revenue in the third quarter increased by 281%, to C$8 million from C$2 million for the same period in the previous year. Gross margin increased by 160%, to $3 million from $1 million in the same period in 2018, primarily due to an increase in sales volume.

48North

48North Cannabis Corp. (TSXV: NRTH) released its financial and operating results for the fiscal year ended June 30, 2019. The company delivered net revenue of $4,820,000, marking 48North’s first full year of revenue, but a net loss of $8.1 million. In fiscal 2019, the company raised over $48 million and at the end of the year had $52.7 million in cash and cash equivalents on hand. As a result, 48North believes it is well capitalized to execute on its business plan.


Debra BorchardtDebra BorchardtSeptember 30, 2019
shutterstock_256424509-1280x853.jpg

5min8960

Gotham Green Partners has invested an additional $20 million in iAnthus Capital Holdings, Inc. (CSE: IAN)(OTCQX: ITHUF) through the purchase of senior secured convertible notes. Green Gotham said it was part of a broader $100 million financing plan to support the buildout of all existing markets in which iAnthus currently operates.

iAnthus has been building its market share at a rapid pace. Over the past 16 months, Chief Operating Officer Pat Tiernan said in a statement that the company currently has 27 open dispensaries, 11 of which have opened in the last ten months and the company is aggressively working to open another 12 in the next six months. Tiernan added, “We are growing in each of our markets and are one of the only MSOs that has meaningful revenue in multiple states, including ArizonaColoradoFloridaMarylandMassachusetts and Nevada, with strong same-store sales growth across our footprint.”

“We are pleased to be working with a leading financial investor in the U.S. cannabis sector. The new notes will allow us to build out operations in our key markets and continue to develop our retail and product brands,” said Hadley Ford, CEO of iAnthus.   “We believe this level of support from GGP will fully fund the development of our existing assets and provide the necessary capital for iAnthus to achieve positive and sustainable EBITDA and operational free cash flow in 2020.”

Terms

The notes have an annual coupon of 13%, payable quarterly, which will mature on May 14, 2021, subject to the iAnthus’ right to extend the maturity date by twelve months, and are exchangeable into common shares of the company at a conversion price of $1.89, which represents a 25% premium to the closing price of the common shares on Friday, September 27, 2019. The notes are being issued with $10 million of attached three-year warrants with an exercise price of $1.97.  Any additional notes will have substantially the same terms, including conversion price and warrant coverage, subject to compliance with the policies of the CSE. The note purchase agreement provides GGP the right to purchase additional notes of up to $66.5 million for a total of $86.5 million. The company may obtain an additional $13.5 million from potential financing sources, including GGP or others, to fulfill its $100.0 million plan, with any such additional financing subject to the negotiation of pricing, terms, and conditions in the context of the market.

“We have viewed iAnthus as a key partner since our initial investment in May 2018 and have closely watched the Company’s evolution as it has continued to execute on its operational strategy across multiple markets. The Company has made significant strides in broadening and operationalizing its footprint, which we do not believe is reflected in the Company’s current trading price,” said Jason Adler, Managing Member of Gotham Green Partners. “We look forward to working alongside iAnthus and continuing to support the growth of the Company.”

 


William SumnerWilliam SumnerSeptember 19, 2019
daily_hit004-1280x533.png

4min7530

It’s time for your Daily Hit of cannabis financial news for September 19, 2019.

On the Site

Eaze

California delivery software company Eaze has finally gotten fed up with DionyMed’s (CSE: DYME) (OTC:DYMEF) accusations and filed a countersuit on Tuesday against the company. For DionyMed, it comes at a pretty bad time. The company just accepted the resignation of its COO Pete Hilliard and is restructuring its debt. Plus, the stock was halted in trading. So, where to begin? Let’s start with the Eaze lawsuit.

iAnthus

iAnthus Capital Holdings, Inc. (CSE: IAN) (OTCQX: ITHUF) has entered an agreement to acquire WSCC, Inc., better known as Sierra Well, for $27.6 million. iAnthus will pay for the acquisition price with $5.1 million in cash and $22.5 million in company shares, priced at the 10-day volume-weighted average price prior to closing of the transaction. Sierra Well is a Nevada-based, vertically integrated cannabis company with two retail dispensary locations and two cultivation/production facilities in Reno and Carson City totaling a combined 20,000 square feet

In Other News

Future State Brands

The cannabis brand holding company, Future State Brands, announced its launch today with more than $25 million in funding. The company is led by PRØHBTD CEO and Founder Drake Sutton-Shearer; and its portfolio includes a hemp cosmetics line, a music-inspired cannabis brand called Heavy Grass, and a line of infused products.  “I’m excited to move into this next phase of our journey with a crystal clear vision of our desired future state. Although brands is the vehicle to get us there, it cannot be achieved without an incredible team, accessible capital and most of all, an understanding of the customer we are building for,” said Sutton-Shearer.

Vireo Health

Vireo Health International, Inc. (CNSX: VREO) (OTCQX: VREOF) announced today that its shares have received Depository Trust Company (DTC) full-service eligibility in the United States. DTC is a subsidiary of the Depository Trust & Clearing Corp., which manages the electronic clearing and settlement of publicly traded companies. DTC Eligibility will allow the company’s shares to be distributed, settled and serviced through DTC’s automated processes.


William SumnerWilliam SumnerAugust 27, 2019
daily_hit004-1280x533.png

6min8770

It’s time for your Daily Hit of cannabis financial news for August 27, 2019.

On the Site

iAnthus

iAnthus Capital Holdings, Inc. (CSE: IAN)(OTCQX: ITHUF) delivered solid financial results for the fiscal second-quarter ending June 30, 2019 with revenues increasing 100% sequentially to $19.2 million from $9.6 million in the first quarter and easily whipping last year’s $256,000 for the same time period. The  company’s second-quarter net loss of $9.3 million was a considerable improvement over the adjusted net loss of $16.5 million in the first quarter and much better than last year’s net loss of $35.4 million for the same time period.

Canopy Rivers

Cannabis investing company Canopy Rivers Inc.  (TSXV: RIV), (OTC: CNPOF) reported its unaudited financial results for the first quarter ending June 30, 2019, with an operating income of $2.7 million. However, expenses in the quarter totaled $5.8 million leading to a net loss of $2.9 million. The company also said it expects to recognize its share of net losses during the remainder of the fiscal year.

More Consumers are Drinking their Cannabis and Big Brands are Getting in On It

Both the cannabis and beverage industries saw dollar signs when Constellation Brands added a $4 billion investment to its already ample investment into Canopy Growth… Headset recently came out with an extensive report examining the rapidly developing cannabis-infused beverages industry, stating that although beverages don’t make up the majority of cannabis product sales, they are “a category within cannabis that’s worth watching.”

In Other News

TerrAscend

TerrAscend Corp. (CSE: TER) (OTCQX: TRSSF) announced the early exercise of purchase warrants to acquire proportionate voting shares representing 28,636,361 common shares, for gross proceeds of approximately C$31.5 million. The outstanding warrants were held by funds advised by JW Asset Management, LLC which are affiliates of TerrAscend Chairman, Jason Wild.  “The early exercise provides TerrAscend with capital in a timely and efficient manner”, said TerrAscend CEO, Michael Nashat. “We value our relationship with JW Asset Management, LLC and appreciate their continued support of our strategy to develop and acquire premium brands, while continuing to build a global footprint.”

Hounds Labs

Hound Labs Inc., a technology company that has developed a dual-purpose breathalyzer for cannabis and alcohol, announced that it had raised $30 million in Series D financing. The funds will go towards accelerating the manufacturing of the company’s cannabis/alcohol breathalyzer for commercial use. Leading the round was Intrinsic Capital Partners. “With the publication of clinical study results validating breath as the new frontier for testing recent use of THC, investors can see the tremendous value that Hound Labs will bring to the market with its first-of-its-kind technology,” said Dr. Mike Lynn, CEO and co-founder of Hound Labs. “We are excited to usher in a new era of more meaningful and fair drug testing now that marijuana is both medically and recreationally available to so many people.”

MedPharm Research

MedPharm Research announced that it had received a notification from the DEA that is had been chosen to move forward as one of the first applicants to be granted a license to grow federally legal cannabis under the terms of a new policy statement issued in the Federal Register. This is something we have been waiting for since we first sent in our application in September, 2016, as one of the first medical grow facilities to apply for a license,” Albert Gutierrez, CEO of MedPharm. “It is a real game-changer for the whole medical cannabis industry.”


Debra BorchardtDebra BorchardtAugust 27, 2019
ianthus3.jpg

5min12502

iAnthus Capital Holdings, Inc. (CSE: IAN)(OTCQX: ITHUF) delivered solid financial results for the fiscal second-quarter ending June 30, 2019 with revenues increasing 100% sequentially to $19.2 million from $9.6 million in the first quarter and easily whipping last year’s $256,000 for the same time period.

The company’s second-quarter net loss of $9.3 million was a considerable improvement over the adjusted net loss of $16.5 million in the first quarter and much better than last year’s net loss of $35.4 million for the same time period.

The first half of 2019 has been an exciting time for team iAnthus, and I want to thank all of our employees, nearly 700 strong, for all of their hard work.  We have integrated the MPX and iAnthus businesses, and the team effort is beginning to show in our results. MPX products are now carried in three states in over 110 stores and we’ll be adding CaliforniaMassachusetts, and Florida later this year,” said Hadley Ford, CEO of iAnthus. “We continue to generate operational efficiencies without limiting growth.  This is evidenced by our 35% sequential revenue growth, expanding gross margins and limited incremental G&A expenses.”

Expenses Under Control

While other cannabis companies seem to spend with abandon, iAnthus expense kept a sharp eye on its general and administrative expenses which only increased to $5.7 million in the second quarter from $4.1 million in the prior quarter. With 700 employees now, the salaries and benefits expenses increased to $8.1 million in the second quarter from $6.1 million in the first quarter. The adjusted gross margin for the quarter was 52.4%, up from 23.4% in the first quarter and the adjusted gross profit of $10.1 million, up 347% from $2.2 million in the prior quarter.

iAnthus noted that its eastern region revenue increased to $10.2 million, up 143% from the prior quarter and the western region revenue increased to $9.0 million, up 67% from the prior quarter. The company now has eight dispensaries in Florida. It is a wholesaler to 21 dispensaries in Massachusetts and expects to open a dispensary there by the end of the year. There are three dispensaries in Maryland and expansion plans for New Jersey and New York.

Ford added, “Since opening our first Florida dispensary in December 2018, we have grown our market share to 3.5% and we are the third highest in the state in terms of THC volume per store.  These results in Florida show what we can bring to other greenfield markets for iAnthus like New York and New Jersey. In Massachusetts, we have made significant progress toward opening our first adult-use store in Worcester, and this fall will mark the launch of our new Be. store brand with the opening of our Brooklyn flagship store.”

Cash On Hand

The company has cash and cash equivalents of $30.5 million, an increase of $642.6 million (or 382%) in total assets from year-end 2018.

“As always, reducing our cost of capital remains a focus.  Our recently announced commitment for up to $50 million Senior Secured financing from Torian Capital, once closed, will move us forward on that front,” said Ford.

The stock was recently trading at $2.53, down from its 52-week high of $7.27.


StaffStaffAugust 20, 2019
daily_hit004-1280x533.png

7min8200

It’s time for your Daily Hit of cannabis financial news for August 20, 2019.

On The Site

iAnthus

Multi-state operator iAnthus Capital Holdings, Inc. (CSE: IAN)(OTCQX: ITHUF) said that it has entered into a senior secured term loan of up to $50 million from one or more investment funds managed by Torian Capital Partners. The loan will be doled out in two tranches of $25 million each with similar terms.

iAnthus said it will use the money for its expansion efforts in Florida and the company’s new Be. retail locations in Nevada, New Jersey and New York. The company is expected to report its second-quarter earnings on August 27.  Last month the company noted that its CBD For Life products will be sold in Dillards Department Stores.

BDS Analytics

Cannabis data company BDS Analytics announced that it closed on $7 million in new financing, led by KEY Investment PartnersAltitude Investment Management, and 7thirty, with participation from other investors. A part of the financing deal, Pete Karabas of KEY Investment Partners will be joining the board of directors. BDS said it will use the money to expand coverage of emerging cannabis markets and strengthen its operating infrastructure with investments in machine learning, marketing and sales, and strategic partnerships.

“As the global cannabis economy continues to expand, it is imperative that we’re able to scale alongside it to remain an indispensable asset for key decision-makers in the industry,” said Roy Bingham, CEO, and Founder of BDS Analytics. “We’re excited about this new round of funding, which will allow us to further enhance our GreenEdge platform and expand our capabilities to the entire addressable cannabinoid market.”

In Other News

Organigram

Organigram Holdings Inc. (NASDAQ: OGI) (TSX VENTURE: OGI) received final approval for the listing of its common shares on the Toronto Stock Exchange (“TSX”). Organigram’s common shares will commence trading on the TSX at the opening on Thursday, August 22, 2019, continuing to trade under the symbol OGI. To ensure continued and seamless trading for the Company’s shareholders and as a result of the graduation, there will be no further trading on the TSX Venture Exchange after Wednesday, August 21, 2019. Organigram’s common shares will be delisted from the TSX Venture Exchange at the commencement of trading on the TSX.

Empower Clinics

Empower Clinics  (CSE: CBDT) (OTC: EPWCF) a vertically integrated and growth-oriented CBD life sciences company, and a multi-state operator of medical health & wellness clinics in the U.S., announced that its common shares will begin trading on the OTCQB Venture Market at the opening of the market on August 20th, 2019 under the stock symbol (OTC: EPWCF). “Our listing on the OTCQB Venture Market in the United States complements Empower’s listings on the Canadian and Frankfurt Stock Exchanges, respectively, broadening our investment base as we accelerate our growth strategy in the global medical cannabis and wellness sectors,” said Steven McAuley, Empower CEO.  “This is a timely milestone, as we have a robust pipeline of activity tied to product development, business development, M&A and, overall company expansion.”

Acquired Sales Corp.

Acquired Sales Corp. (OTC Pink: AQSP) announced that it has signed a definitive merger agreement to acquire 100% of CBD LION LLC (www.CBDLION.com), Mundelein, Illinois, for consideration of $2 million in cash, plus 5 million shares of Acquired Sales Corp.’s common stock. Acquired Sales Corp. also announced that it has loaned $300,000 to CBD LION LLC that will be used as growth capital.



About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

@GreenMarketRpt – 2 days

In case you missed it. Weed Talk News 10/16/2020 via @ProCannaMedia

@GreenMarketRpt – 5 days

Green Market Report’s Marijuana Money October 16, 2020

@GreenMarketRpt – 1 week

Green Market Report Wins Big During 2020 Awards Season

Back to Top

You have Successfully Subscribed!