MariMed Archives - Green Market Report

Julie AitchesonFebruary 14, 2022


To celebrate winter’s sexiest holiday, multi-state cannabis company MariMed (OTC: MRMD) compiled a survey for their edible brand Betty’s Eddies. The results suggest that you might want to consider picking up your Valentine’s favorite brand of cannabis edible to heat things up this February 14th. According to MariMed’s survey, 72% of cannabis consumers are already planning to incorporate cannabis into their Valentine’s Day festivities, with more than half saying they would like to receive cannabis as a gift for the lover’s holiday.

More broadly, the survey found that of the 76% of cannabis users who reported being sexually active, cannabis users have more sex than non-cannabis users. 50% of cannabis-consuming respondents said they get intimate several times a week compared with only 35% of non-users. Most people would agree that, when it comes to sex, it’s not just the quantity but the quality that counts. Nearly two-thirds of cannabis users who responded to the MariMed survey reported that cannabis enhances their sex lives overall. 

When it comes to getting in the mood for sex, 63% credit cannabis for stimulating their desire for intimacy. In fact, more than half of cannabis consumers believe that cannabis is a natural aphrodisiac, and 30% rank it as number one in terms of effectiveness. That finding makes a jump among consumers aged 35-44, 40% of whom rank cannabis as the most effective aphrodisiac. Among those households with children (a common outcome of sex, but also a common deterrent), 61% of cannabis consumers reported that cannabis helps their partner get in the mood. This might explain why a whopping 82% of cannabis users with children in the household and 82% of parents with a child under the age of 18 say they will be incorporating cannabis into their Valentine’s Day celebration. That’s almost 20% more than those without children.

Edibles Are The Winner

And what is the preferred cannabis consumable to set the stage for sexy times? You guessed it. A full 52% of consumers surveyed prefer edibles over smoking cannabis to get those loving feelings flowing. The Brightfield Group produced a report on cannabis distribution trends in the US focused specifically on cannabis chocolates, which credits improved edibles technology with taking the taste of cannabis chocolate to the next level and increasing its popularity. 

While plain still holds down most of the space on shelves, flavors like mint, caramel, espresso, raspberry and almond have also been popular pairings with chocolate. The rising star on the flavor scene, however, is pomegranate, which has tripled from 0.1% to 0.3% in nationwide distribution since September 2021. Brightfield also found that a strong majority of consumers surveyed preferred their cannabis chocolates on the milder side (10 mg) in terms of potency. So rather you’ve been plotting the perfect Valentine’s surprise with the focused precision of a Navy Seal captain or making a panicked last-minute purchase on your way home from work on Monday, chances are that if your sweetie is a cannabis consumer, they might be hoping for a greener version of the Whitman’s Sampler this year.

StaffJanuary 5, 2022


MariMed Inc. (OTCQX: MRMD) is buying Maryland-based Kind Therapeutics U.S.A., LLC in a deal valued at $20 Million. MariMed will also buy the minority interests of one of the current owners of Kind in two subsidiaries of the company that owns cannabis facilities in Maryland and Delaware for $2 million.

Bob Fireman, Chief Executive Officer of MariMed said, “This acquisition will deliver another transformational year for MariMed in 2022, building on two consecutive years of more than 100% cannabis revenue and Adjusted EBITDA growth.” This deal will make this the third state, in addition to Massachusetts and Illinois, in which MariMed will have acquired a licensed cannabis business it manages and assisted in developing. Once acquired, Kind’s financial results with be reported by the company on a consolidated basis.

Kind, which holds cannabis licenses for cultivation and production, as well as a provisional license for a dispensary, currently leases from Mari Holdings MD, LLC, a MariMed subsidiary, a 180,000 square foot cultivation and processing facility in Hagerstown, which MariMed developed. Mari Holdings MD, LLC also owns and is developing a dispensary facility for Kind in Annapolis, which is expected to open in early 2022. Under MariMed’s management, Kind has been successfully manufacturing and distributing cannabis and cannabis products into Maryland’s robust wholesale cannabis industry, which has grown to 103 dispensaries. These products include MariMed’s award-winning products and brands including Nature’s Heritage craft flower, Betty’s Eddies fruit chews, and k FUSION chewable tablets. Betty’s Eddies has been a top-selling edible brand in the state. MariMed went on to say that upon the closing of these transactions, all Kind related litigation will be dismissed with prejudice.

Maryland’s legal medical cannabis program currently has more than 139,000 registered patients and, according to the Maryland Medical Cannabis Commission the state receives more than 200 applications for medical cannabis cards every day. Maryland’s medical cannabis program was on pace to generate more than $500 million in sales in 2021. According to Cowen Research, with a population of 6.2 million, Maryland’s medical cannabis program boasts some of the highest rates of registered medical consumers, incidence usage and spending, on a per capita basis, among all legal medical cannabis programs in the U.S. The state legislature is reviewing proposals to implement an adult-use cannabis program in the future.

StaffDecember 8, 2021


December 8 is National Brownie Day and what better way to celebrate than creating the world’s largest edible – an infused brownie. MariMed, Inc. (OTCQX: MRMD) unveiled the world’s largest cannabis-infused brownie in celebration of the launch of its new brand Bubby’s Baked and National Brownie Day.

To commemorate the launch of Bubby’s, MariMed’s craft confectioners in Massachusetts baked a larger-than-life version of a Bubby’s soft-baked brownie that is believed to be the world’s largest THC-infused brownie ever made. The confection measures 3 feet wide by 3 feet long and 15 inches tall, weighs a whopping 850 pounds and contains 20,000mg of THC.

Brownies Are The First Edible

Brownies are a significant part of cannabis edible history. The Alice B. Toklas Cookbook first published in 1954 included a recipe for a Moroccan hashish fudge and was ultimately Americanized to become a brownie. Toklas actually didn’t know that a friend of hers had included the recipe and was surprised by the controversy. The book didn’t originally include the recipe in the first American printing, but it was included in the second, which was printed in the early 1960’s. That was just in time for the hippie culture to make it their own and it was referenced in the 1968 film, I Love You Alice B. Toklas. In the movie, a hippie girl makes pot brownies and serves them to her straight-laced guests.  The original recipe actually didn’t even have chocolate in it and was more of a dessert-like Turkish Delight.

Bubby’s Launch

The launch date and the National Brownie day seemed to happily collide. Bubby’s edibles were previously baked in Massachusetts under the name “Bourne Baking Co.” Bubby’s bites are made from scratch in small batches, and infused with precision-dosed, full-spectrum cannabis. Bubby’s comes in three classic confectionery recipes – brownie, chocolate chip, and snickerdoodle. The line is available throughout Massachusetts, including MariMed’s Panacea dispensary in Middleborough, Massachusetts. It is expected to hit dispensary shelves in Delaware and Maryland early next year.

“Bubby’s Baked fills a big hole in the edibles market that cannabis consumers crave – high-quality, delicious baked goods that stay moist and chewy,” said MariMed Chief Product Officer and SVP/Sales Ryan Crandall. “For many of us, homemade brownies were our first taste of cannabis-infused edibles. Bubby’s recreates and elevates that nostalgic experience, infusing full-spectrum, craft-quality cannabis into timeless recipes, for a reliable high reminiscent of simpler times. Strategically, Bubby’s is part of our effort at MariMed to build a house of brands that meets different consumer needs across a diverse range of occasions.”

For the regular consumer, each Bubby’s single-serving bite contains 5mg of THC in Massachusetts in compliance with state regulations.



According to Guinness World Records, the World’s Largest Brownie (not infused) was created in 2013 and was 243 pounds. MariMed’s infused brownie is 3x that – a whopping 850 pounds – and contains 20,000 mg of THC including:

  • Eggs – 1,344 eggs

  • Sugar – 250 lbs

  • Butter – 212 lbs

  • Vanilla Extract – 5.3 lbs

  • Flour – 81 lbs

  • Baking Powder – 2 lbs

  • Salt – 3 lbs

  • Cocoa Powder – 122 lbs

StaffSeptember 28, 2021


Robert (Bob) Fireman has served as CEO and President of MariMed, Inc. since July 2017, and has served as a director of the company since its formation. Bob has been a driving force of the legal cannabis industry since 2010, when he and current MariMed CFO Jon Levine entered the industry through an investment in a California cannabis license. Over most of the next decade, the company served as advisors to license holders in multiple states, successfully helping them secure their licenses, hiring and training their staff, providing management services to them, designing and developing their facilities, and developing and licensing to them a number of high-quality, proprietary products.

Bob subsequently led the company’s successful transformation to a plant-touching, highly profitable multi-state operator that cultivates, produces and distributes award-winning cannabis products that are top-sellers in the markets in which they are available. They include the premium flower brand Nature’s Heritage, Betty’s Eddies fruit chews, K-Fusion precision-dosed, chewable mint tablets, and more.

Prior to MariMed, Bob developed a number of successful businesses across diverse industries. He created Consumer Card Marketing, Inc (CCMI), which pioneered the implementation of card-based loyalty marketing programs for 50,000 retail, grocery and drug stores and was later sold to a division of News Corporation. Later, he created and now sits on the Board of Directors of Sky Vegetables, a hydroponic farming company that delivers fresh produce to lower-income citizens in the Bronx, New York. 

Mr. Fireman holds a BA degree from the University of Wisconsin and a JD from Suffolk University Law School.


Robert (Bob) Fireman


CEO and President


MariMed, Inc. (OTCQX: MRMD)

Years at current company: 

8 years.

Education profile:

BA degree from the University of Wisconsin 

JD from Suffolk University Law School

Most successful professional accomplishment before cannabis:

I’m perhaps most proud to have devoted most of my professional and personal life to helping improve the lives of those less fortunate than me. That’s core to MariMed’s mission, but it’s been a consistent thread for decades. For example, I was a political activist and also served as a public defender in my early years as an attorney. Later, I founded an urban hydro-farming business that delivers fresh produce to lower-income citizens in the Bronx, NY.  

Company Mission:

MariMed is dedicated to improving lives every day through our products, actions, and values. 

Company’s most successful achievement:

We have built a successful and profitable business while maintaining a culture of collaboration, innovation, compassion, and integrity. I believe that’s what has driven the trust in our products that we’ve established with our customers, and ultimately why they are top sellers in the markets where they’re available.

Has the company raised any capital (yes or no): 


If so, how much?:

$105 million.

Any plans on raising capital in the future?

Not at this time. Our strong balance sheet and cash position have positioned us to implement our strategic growth plan without the need to raise additional funds.

Most important company 5-year goal:

MariMed’s most important 5-year goal is to own the most beloved, trusted, and best-selling cannabis products in the country while being recognized as an exceptional corporate citizen. 

Debra BorchardtAugust 16, 2021


MariMed, Inc. (OTCQX: MRMD) reported its financial and operating results for the quarter ending June 30, 2021, as revenue increased 239% to $32.6 million versus last year and jumped  32% sequentially. MariMed also delivered a net income of $7.6 million in the second quarter of 2021 versus a net loss of $1.1 million in the second quarter of 2020, and net income of $4.3 million versus the first quarter of 2021. The company also increased its revenue guidance in 2021 to $118 million.

“We are extremely pleased with our continued improving financial performance during the second quarter,” said Bob Fireman, CEO, and President of MariMed. “We continue to report some of the strongest revenue and EBIDTA growth in the entire cannabis industry. Our strong financial position is the result of our operational excellence combined with our financial discipline. I could not be more confident in our ability to maintain our trajectory to be a top-tier MSO and deliver improved stockholder value as we continue to execute on our Strategic Plan.”

The reported EBITDA of $12.3 million, was the sixth sequential quarter of positive EBITDA growth. Reported EBITDA increased 440% versus the second quarter of 2020, and an increase of 61% versus the first quarter of 2021. The reported adjusted EBITDA of $13.9 million, a 391% increase in the second quarter of 2020 versus an increase of 73% in the first quarter of 2021.

Massachusetts for the Win

MariMed noted that its solid quarter was due to a significant increase in wholesale sales, particularly in Massachusetts, where it benefited from higher production at the New Bedford, MA cultivation and manufacturing facility. The company said its retail locations in Massachusetts and Illinois also saw strong growth. MariMed said the Panacea Wellness dispensary in Middleborough, MA experienced higher customer counts and increasing revenue throughout the quarter. “Commencing operations in May, Thrive Metropolis, the fourth MariMed dispensary in southern Illinois, exceeded expectations. MariMed’s three other Thrive branded dispensaries in the state, located in AnnaHarrisburg and Mt. Vernon, all had strong quarterly results.”

The company also saw an increase in branded product sales and licensing fees from the product portfolio, including its Betty’s Eddies vegan chews brand, Nature’s Heritage premium flower, Kalm Fusion precision dose chewable tablets brand, and others. MariMed brands are now available in six states and Puerto Rico. Betty’s Eddies is the #1 cannabis product brand in Massachusetts and Maryland, according to BDSA data.

Looking Ahead

MariMed management said in a statement that it will move forward with its previously announced Consolidation Plan, that would consolidate the company’s existing clients into the public company. It also plans on increasing revenues in existing states, by increasing cultivation and production capacity and developing new assets within those states. The company plans on expanding through new license applications and M&A and building the portfolio brands.

“In light of MariMed’s significant organic growth, driven by the strong performance of our retail stores in Illinois and Massachusetts, stronger than expected wholesale sales, and other contributing factors, we are confident raising 2021 guidance,” said Jon Levine, MariMed’s Chief Financial Officer. “Based on these factors, we are increasing our 2021 revenue guidance to $118 million, EBITDA to $32 million, and including Adjusted EBITDA guidance for the first time of $42 million.”

Debra BorchardtMarch 24, 2021


MariMed, Inc. (OTCQX: MRMD) reported financial and operating results for the three and twelve-month periods ended December 31, 2020, after the market closed on Tuesday. MariMed’s cannabis revenues increased 292% in the fourth quarter to $20.4 million versus $5.2 million for the same time period in 2019. 

Core cannabis revenues increased 207% to $50.9 million in 2020 versus $16.6 million in 2019. The company attributed the increase to the full-year consolidation of Illinois and the results from Massachusetts which began operations in December 2019. MariMed’s revenues also benefited from the robust adult-use markets in both of those states as well as the growth of our managed cannabis businesses in other states.

The net income for 2020 was $2.4 million for the quarter versus a net loss of $81.9 million in 2019. Excluding the net impact from the one-time hemp seed sales in 2019, the 2019 net loss was $30.8 million. The profit improvement results primarily from the consolidation of the company’s operations in Illinois and Massachusetts.

“This was an exceptional year for MariMed as we accomplished several important milestones while making significant progress executing on our strategic growth plan. In 2020, we achieved record revenue and saw improvements in profitability resulting from the inclusion of consolidated revenues from our Massachusetts and Illinois businesses.  Revenue and profitability also benefitted from the continued success of our Branded Products which remain top sellers in their respective state markets.” said Bob Fireman, CEO of MariMed. “With the Hadron financing, we have strengthened our balance sheet and secured the necessary capital to further execute on our consolidation strategy and position ourselves for accelerated growth in the industry.  We have improved our liquidity and capital resources and are profitable and tracking to continued revenue growth from the established businesses we have in place.  We intend to continue to implement our strategic plan to acquire and consolidate the businesses we organically built into our public company and are poised to become one of the leading fully integrated and profitable multi-state operators in the cannabis industry.”


MariMed is initiating the full year 2021 revenue guidance of $100 million and EBITDA guidance of $30 million. the company said in a statement that over the last year it anticipates accelerated growth in 2021 driven by adding additional dispensaries and continued focus on consolidating key assets under management as well as facility expansion in Delaware and Maryland. In addition, MariMed said it will expand the licensing of its branded products into other states.

“In Massachusetts, we plan to identify and open two new dispensaries servicing both the medical and adult-use markets and the fourth dispensary in Illinois servicing the adult-use market. Growth will also result from having a full year of production from our New Bedford, Massachusetts facility. Additionally, the Company is reviewing plans to double the size of the New Bedford facility through expansion into the 65,000 square foot adjacent company-owned property, as well as further technology upgrades and expansion of extraction labs and production kitchens.

In Delaware, we are expanding cultivation and processing meet the strong demand in that state. In Maryland, we will focus on cultivation and processing expansion and are currently receiving bids for the buildout of a dispensary facility in Anne Arundel County, Maryland, which we intend to open during 2021.”

Debra BorchardtAugust 11, 2020


MariMed Inc. (MRMD:OTCQX) reported that its revenues rose 163% to $9.6 million for the second quarter versus $3.7 million for the same time period in 2019. Still, the company delivered a net loss of $1.2 million versus last year’s income of $4.6 million. The net income per share was flat at zero versus last year’s earnings per share of $0.02 for the same time period.

Operating expenses for the second quarter of 2020 rose to $4.1 million versus $3.6 million in 2019. The company blamed the increased expenses on increased personnel costs as MariMed transitions to a direct owner and operator of seed-to-sale cannabis operations.

Bob Fireman, CEO of MariMed said, “Our renewed focus on our core cannabis business and the consolidation of our managed assets are the key drivers of MariMed’s positive Q2 results. In Massachusetts, we have now ramped up our New Bedford manufacturing facility to produce over 1,000 pounds of cannabis flower per month. Our Nature’s Heritage Flower brand and our Betty’s Eddie’s natural chews infused brands are leading sellers in their respective categories in both Massachusetts and Maryland. Our two dispensaries in Illinois are thriving in the new adult-use program. We intend to open our third dispensary in Illinois in September and a projected fourth by the new year.”

The company is slowly improving its financial status. On June 30, 2020, the company’s negative working capital improved to approximately $21.5 million from approximately $29.3 million at December 31, 2019. In addition, during the six months ended June 30, 2020, MariMed’s operating activities provided positive cash flow of approximately $540,000, compared to approximately $22.1 million of negative cash flow used by such activities during the same period of 2019. The company said in its filing that it is looking to raise more capital but can’t be assured that it will be successful.

Year-to-date revenues totaled $17.1 million, a 138% increase compared to $7.2 million for the first six months of 2019. The company reported that its gross profit from the core cannabis business was $6.2 million for the quarter, a 133% increase from the $2.6 million for the comparative period in 2019. The adjusted EBITDA of $3.3 million for the second quarter of 2020 compared to a loss of $250,000 for the same period in 2019.

Jon Levine, CFO, added “I am pleased with the revenue growth from both our consolidated and managed licensed cannabis businesses. We are confident that the marketplace will recognize the positive track that our revenue and earnings are on. At the same time, we also took decisive actions in the second quarter by restructuring our short-term debt which significantly strengthens the Company’s financial position.”

Debra BorchardtJuly 20, 2020


GenCanna, one of Kentucky’s largest hemp companies, filed for voluntary Chapter 11 reorganization with the U.S. Bankruptcy Court in the Eastern District of Kentucky earlier this year in February. One problem with GenCanna’s bankruptcy filing though was that MariMed (OTC:MRMD) was one of the largest shareholders in the company. It had a $34 million claim against the company sparking a battle over control of the company.

Last week, Law360 reported that MariMed lost a round over the efforts to gain control over the company. The website said that U.S. Bankruptcy Judge Gregory Schaaf of Kentucky found MariMed had acted improperly when it attempted to replace members of GenCanna’s board of directors and force out GenCanna’s president and chief executive officer.

The Fight Begins

In any bankruptcy cases, debtors are first in line over equity holders. In the process of working through its bankruptcy, GenCanna made a deal to sell the bulk of its assets for $75 million. MariMed was against the deal and had its own plan to reorganize the company, but apparently couldn’t come up with the money needed for the plan. According to the Law360 reporting, the court records demonstrated that GenCanna went with the offer it had.

The court records said that MariMed’s president and chief executive officer Robert Fireman, who also sits on GenCanna’s board of directors, teamed up with another board member, Michael Falcone, to form a voting bloc controlling 52% of GenCanna’s parent company’s shares. The two apparently pulled GenCanna Chief Executive Officer Matty Mangone-Miranda, GenCanna President Steve Bevan, and one other member of the board of the parent company, and installed Fireman as chairman, according to court records.

The court filings stated that Fireman and Falcone appointed a new CEO of the parent company, and directed him to get the bankruptcy case dismissed. The new director of GenCanna USA’s board was told to develop a plan to liquidate the company within 30 days.

The ousted executives, Mangone-Miranda and Bevan asked Judge Schaaf to step in claiming MariMed’s actions violated board rules. The Judge agreed saying, “Using an equity position that has no chance of recovery to object to a settlement that is not even filed is an obvious attempt to exercise control over the case and enhance the creditor interests,” Judge Schaaf wrote. “Further, this also suggests clear abuse of the governance process that would warrant action in this court if an injunction was requested. For now, that analysis is not required.”

Basically, since the assets were sold, there is nothing left for the equity owners like MariMed. Since there’s nothing left for MariMed, they have no power to make these types of decisions at the company. GenCanna said it is in settlement negotiations with its senior secured lender and buyer to resolve claims from the committee of unsecured creditors. The settlement is expected to generate roughly $1 million, but the claims are much higher than that.

The assets were sold to New York-based MGG Investment Group, a private lender, and one of the company’s creditors.

GenCanna’s Pain Inflicted On MariMed

GenCanna’s bankruptcy filing also weighed on the shares of MariMed. In April, MariMed’s fourth-quarter 2019 financial results included a one-time charge of $30.2 million as a result of a write-off of its investment in GenCanna. CEO Jon Levine said, “Despite GenCanna’s Chapter 11 filing, we believe that it will emerge with a restructured capital and operational structure that will allow GenCanna to restore its position as a leader in the hemp industry. If this occurs, we believe there will be an opportunity for the value of the assets to be recaptured at a later date.  We expect to continue our strong relationship with GenCanna and jointly pursue opportunities in the evolving hemp industry.”

MariMed’s shares have dropped from 40 cents in February before the GenCanna bankruptcy and were lately selling at 13 cents.

Debra BorchardtMay 12, 2020


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.”

Debra BorchardtApril 1, 2020


MariMed Inc. (MRMD:OTCQX) quarterly revenues for the quarter ending December 31, 2019, increased 50.9% to  $5.19 million versus $3.44 million for the same period of 2018. The company attributed the increase to the roll-up up of MariMed’s licensed client businesses in Illinois in the fourth quarter of 2019.  Fourth-quarter 2019 revenues were also bolstered from new distribution channels secured for MariMed’s Betty’s Eddies and Kalm Fusion brands. The company did not disclose the net loss for the quarter.

Full Year 2019

For the full year ending in December, total revenues grew to approximately $45.6 million. Core cannabis sales for the fiscal year 2019 were $16.6 million, a 40.0% increase compared with $11.9 million for the fiscal year 2018. The operating loss for 2019, including the GenCanna receivable reserve, was $41.6 million, compared with an operating loss of $5.4 million for the full year 2018.  Net loss for the full year 2019 was $81.2 million or $0.39 per share, compared with a net loss of $13.6 million or $0.07 per share for the full year 2018.

Jon Levine, MariMed’s CFO said in a statement, “Due to GenCanna’s recent challenges, we believed it prudent to make these accounting adjustments now to resolve any uncertainty for our stockholders as no further accounting adjustments are expected as a result of GenCanna’s Chapter 11 proceeding. These financial adjustments did not impact our core cannabis business, which continued to grow revenues substantially during the fourth quarter. “

Running On Fumes

At the end of 2019, MariMed had negative working capital of approximately $31.0 million and has incurred negative cash flow from operations of approximately $24.8 million. In early 2020, the company raised approximately $4.4 million as part of an exchange agreement with two institutional stockholders and $935,000 from the issuance of convertible debentures.

In addition to those measures, the company has extended the maturity dates of approximately $19.4 million of promissory notes and is in the process of finalizing the documentation to extend another $3.0 million of promissory notes. MariMed said that it has obtained a commitment from an accredited investor for a $12.0 million loan, secured by the company’s real estate, at a rate of 10% per annum with a one-year term.

Illinois, Massachusetts To The Rescue

Despite the struggles at MariMed, two states could end up saving the day for the company. MariMed said that the Massachusetts operations are expected to contribute to significant revenue growth in 2020 reflecting the shortage of products across the state and the growing demand by consumers. Plus, the company expects to receive approval from the CCC over the next few months to commence adult-use sales at its Middleborough dispensary, pending a final inspection by the agency. The company was able to introduce branded flower company Nature Heritage and infused products called Betty’s Eddies and Kalm Fusion into the Massachusetts market. The company is planning to roll out other exclusive brands such as Tropizen Hot Sauces, Binske and Tikun Olam in 2020.

In the fourth quarter of 2019, MariMed received Illinois state approval and rolled up the ownership of its two previously managed client licensed medical companies, KPG Anna and KPG Harrisburg. On January 1, 2020, adult-use cannabis sales were legalized in Illinois, which has generated an immediate ramp-up in sales to MariMed in the first quarter of 2020. The company began developing a third dispensary in Mount Vernon, Illinois in March 2020 and has subsequently applied for a medical and adult-use cannabis license for this location. The company also intends to open an additional fourth dispensary in the state later in 2020.

Gen Canna Bankruptcy

Even though it had the largest recorded hemp harvest in Kentucky in excess of 6,000 acres, GenCanna filed for voluntary protection under Chapter 11 in order to reorganize and restructure its debt and business operations. As a result, MariMed’s fourth-quarter 2019 financial results included a one-time charge of $30.2 million as a result of a write-off of its investment in GenCanna. GenCanna management expects that its Chapter 11 restructuring will facilitate it emerging as a stronger company with the ability to complete the processing of in excess of 15 million pounds of biomass on hand.  This will permit GenCanna to commence marketing of one of the largest inventories of CBD oils and isolates in the industry in the foreseeable future.

Levine added, “Despite GenCanna’s Chapter 11 filing, we believe that it will emerge with a restructured capital and operational structure that will allow GenCanna to restore its position as a leader in the hemp industry. If this occurs, we believe there will be an opportunity for the value of the assets to be recaptured at a later date.  We expect to continue our strong relationship with GenCanna and jointly pursue opportunities in the evolving hemp industry.”

Looking Ahead

GenCanna certainly didn’t help MariMed’s earnings, but the company has shored up its finances and is crossing its fingers that Illinois and Massachusetts sales help staunch the bleeding.

Mr. Tim Shaw, MariMed’s COO commented, “Brand recognition of our flower and cannabis-infused products continues to grow as we reach new patients and customers, with Betty’s Eddies being named among the top-selling sublingual and edible products in a national survey conducted by LeafLink, the leading wholesale platform for cannabis products in the United States.  Bringing these products to new patients and customers, as well as launching new SKUs under our best-selling brands, will remain one of our key objectives throughout 2020.”

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