Unrivaled Brands Inc. (OTCQB: UNRV) reported that revenue for its third quarter ended Sept. 30 fell slightly to $8.6 million from last year’s $9.7 million for the same time period. It also declined slightly from the second quarter’s revenue of $8.7 million.
Unrivaled reported a net loss of $3.3 million, triple the second quarter’s loss of just $1.1 million but vastly better than last year’s eye-popping loss of $111 million for the third quarter. As of Sept. 30, the company had an accumulated deficit of $444.44 million and is considered a going concern.
By the end of the quarter, Unrivaled had a consolidated cash balance of $2.01 million. Management said in its latest regulatory filing that it expects to experience further net losses in 2023 and the foreseeable future.
“In Q3 2023, we maintained focus on our gross margin, achieving a retail gross margin of 52%. Despite the formidable challenges in the regulated cannabis market, we’ve proven resilient,” CEO Patty Chan said. “We are operating in one of the most cutthroat markets in the United States, competing not just with the legal operators, but also the traditional market.”
On Oct. 10, Unrivaled announced its plan to reorganize into Blum Holdings Inc. The reorganization will result in Unrivaled Brands becoming a direct, wholly owned subsidiary of Blüm.
It is expected that the directors and executive officers of the company will serve in the same capacities under the new banner.
During the fiscal second quarter of 2023, the company said it received confirmation for the legal dissolution of UMBRLA Inc. As a result, all liabilities and existing obligations of the dissolved entity were extinguished, and the company recognized a gain on disposal of assets of $1.74 million.
Unrivaled also listed numerous lawsuits in its filing. The company stands accused of breach of contract by multiple parties. 1149 South LA Street Fashion District LLC and 1135 South LA Street Fashion District LLC look to have won their case against the company, which could cost Unrivaled $500,000.
In addition, Peoples California is suing Unrivaled Brands for $23 million, while Unrivaled said it has set aside $500,000 for a separate employee lawsuit that also claimed breach of contract.
In October 2023, the company said it had received a notice from the city of Santa Ana regarding a business license tax compliance examination of People’s First Choice for the period of Jan. 1, 2018, through May 31, 2021. The examination claims that the city of Santa Ana is owed $860,000 in cannabis business taxes.