LithiumBank Resources

MariMed Reports First Quarter 2024 Earnings

08 May 2024

NORWOOD, Mass., May 08, 2024 (GLOBE NEWSWIRE) -- MariMed Inc. (“MariMed” or the “Company”) (CSE: MRMD) (OTCQX: MRMD), a leading multi-state cannabis operator focused on improving lives every day, today announced its financial results for the first quarter ended March 31, 2024.

“With the first quarter now in the books, I’m pleased to say we are on track with our strategic plan and financial targets,” said Jon Levine, Chief Executive Officer. “The tremendous growth in our wholesale business was undoubtedly the highlight of the quarter. I am proud that once again, MariMed outperformed our competition in every market in which we operate, including Illinois. The strong revenue growth led to our 17th consecutive quarter of positive adjusted EBITDA.”

Financial Highlights1

The following table summarizes the Company's consolidated financial highlights (in millions, except percentage amounts):

 Three months ended
March 31,
  2024   2023 
Revenue$37.9  $34.4 
GAAP Gross margin 43%  45%
Non-GAAP Gross margin 44%  46%
GAAP Net loss$(1.3) $(0.7)
Non-GAAP Net (loss) income$(0.6) $0.3 
Non-GAAP Adjusted EBITDA$4.7  $7.1 
Non-GAAP Adjusted EBITDA margin 12%  21%
        

1 See the reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures and additional information about non-GAAP measures in the section entitled “Discussion of Non-GAAP Financial Measures” below and in the financials information included herewith.

CONFERENCE CALL

MariMed management will host a conference call on Thursday, May 9, 2024 at 8:00 a.m. Eastern time, to discuss these results. The conference call may be accessed through MariMed’s Investor Relations website, or by clicking the following link: MRMD Q124 Earnings Webcast.

FIRST QUARTER 2024 OPERATIONAL HIGHLIGHTS

During the first quarter, the Company announced the following developments in the implementation of its strategic growth plan:

  • January 2: MariMed began selling its award-winning branded products through the Company's new wholesale business in Illinois. MariMed's brands, including Betty's Eddies, Bubby's Baked, Vibations, and InHouse are now widely available in 135 dispensaries throughout the state.
  • February 26: Thrive Dispensary Casey, the adult-use dispensary MariMed managed since opening in Fall 2023, received its Certificate of Occupancy from the Illinois Cannabis Control Commission to commence operations in its permanent brick-and-mortar facility. The Company subsequently transitioned from its temporary facility and commenced operations in the new facility in March 2024.
  • March 6: MariMed announced the expansion of its Maryland footprint with the acquisition of its second dispensary in the state. On February 1, the Company entered into a definitive agreement to acquire the operating assets of Our Community Wellness & Compassionate Care Center, Inc, a medical licensed dispensary operator. The Company subsequently announced the closing of the acquisition on April 9, and plans to open the dispensary, which is located in Upper Marlboro, and commence adult-use sales upon regulatory approval.

OTHER DEVELOPMENTS

Subsequent to the end of the first quarter, the Company announced the following further developments:

  • April 10: MariMed announced a partnership with two iconic Boston music venues, MGM Music Hall Fenway and Citizens House of Blues Boston. This groundbreaking partnership positions Nature’s Heritage as the exclusive cannabis sponsor at each venue. The brand will receive over one million consumer impressions resulting from onsite fan experiences, in-venue advertising, and digital advertising.
  • April 11: MariMed announced the closing of its acquisition of Thrive Dispensary in Casey, Illinois. The approval of the license transfer by the Illinois Department of Financial & Professional Regulation, and subsequent closing of the acquisition, allows MariMed to fully consolidate the financial results of this dispensary, which had previously been operated under a Managed Services Agreement.

2024 FINANCIAL GUIDANCE

MariMed's full year 2024 financial targets are based on organic growth of its existing operating assets and do not include new revenue-generating projects requiring regulatory approvals. The Company believes this conservative approach to offering financial targets allows investors and analysts to focus on key operating milestones versus discussions around issues outside the Company's control. As such, the Company's full year 2024 financial targets remain at:

  • Revenue growth of 5% to 7%;
  • Non-GAAP Adjusted EBITDA growth of 0% to 2%;
  • Capital expenditures of $10 million.

DISCUSSION OF NON-GAAP FINANCIAL MEASURES

MariMed’s management uses several different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall performance of its business, making operating decisions, and planning and forecasting future periods. The Company has provided in this release several non-GAAP financial measures: Non-GAAP Gross margin, Non-GAAP Net income (loss), Non-GAAP Adjusted EBITDA and non-GAAP Adjusted EBITDA margin, as supplements to Revenue, Gross margin, Net income (loss) and other financial measures prepared in accordance with GAAP.

Management believes these non-GAAP financial measures are useful in reviewing and assessing the performance of the Company, and when planning and forecasting future periods, as they provide meaningful operating results by excluding the effects of expenses that are not reflective of its operating business performance. In addition, the Company’s management uses these non-GAAP financial measures to understand and compare operating results across accounting periods and for financial and operational decision-making. The presentation of these non-GAAP measures is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP.

Management believes that investors and analysts benefit from considering non-GAAP financial measures in assessing the Company’s financial results and its ongoing business, as it allows for meaningful comparisons and analysis of trends in the business. In particular, non-GAAP adjusted EBITDA is used by many investors and analysts themselves, along with other metrics, to compare financial results across accounting periods and to those of peer companies.

As there are no standardized methods of calculating non-GAAP financial measures, the Company’s calculations may differ from those used by analysts, investors and other companies, even those within the cannabis industry, and therefore may not be directly comparable to similarly titled measures used by others.

Management defines non-GAAP Adjusted EBITDA as income (loss) from operations, determined in accordance with GAAP, excluding the following items:

  • depreciation of fixed assets;
  • amortization of acquired intangible assets;
  • Impairment or write-downs of intangible assets;
  • stock-based compensation;
  • legal settlements; and
  • acquisition-related and other expenses.

For further information, please refer to the publicly available financial filings available on MariMed's Investor Relations website, as filed with the U.S. Securities and Exchange Commission, or as filed with the Canadian securities regulatory authorities on the SEDAR website.

ABOUT MARIMED

MariMed Inc., a multi-state cannabis operator, is dedicated to improving lives every day through its high-quality products, its actions, and its values. The Company develops, owns, and manages seed to sale state-licensed cannabis facilities, which are models of excellence in horticultural principles, cannabis cultivation, cannabis-infused products, and dispensary operations. MariMed has an experienced management team that has produced consistent growth and success for the Company and its managed business units. Proprietary formulations created by the Company’s technicians are embedded in its top-selling and award-winning products and brands, including Betty’s Eddies, Nature’s Heritage, InHouse, Bubby’s Baked, K Fusion, Kalm Fusion, and Vibations, which are trademarks of MariMed Inc. For additional information, visit www.marimedinc.com

IMPORTANT CAUTION REGARDING FORWARD-LOOKING STATEMENTS:

The information in this release contains “forward-looking” statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, which are subject to several risks and uncertainties.   All statements other than statements of historical facts contained in this release, including without limitation statements regarding projected financial results for 2024, including management’s belief that it will report its fifth consecutive year of positive operating cash flow, anticipated openings of dispensaries and facilities, timing of regulatory approvals, plans and objectives of management for future operations, are forward-looking statements.   Without limiting the foregoing, the words “anticipates”, “believes”, “estimates”, “expects”, “expectations”, “intends”, “may”, “plans”, and other similar language, whether in the negative or affirmative, are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

Forward-looking statements are based on our current beliefs and assumptions regarding our business, timing of regulatory approvals, the ability to obtain new licenses, business prospects and strategic growth plan, and other future conditions.   Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict.   Our actual results may differ materially from those contemplated in these forward-looking statements due to various risks, uncertainties, and other important factors, including, among others, reductions in customer spending, our ability to recruit and retain key personnel, and disruptions from the integration efforts of acquired companies.

These factors are not intended to be an all-encompassing list of risks and uncertainties that may affect our business and results of operations.   These statements are not a guarantee of future performance and involve risk and uncertainties that are difficult to predict, including, among other factors, changes in demand for the Company’s services and products, changes in the law and its enforcement, and changes in the economic environment. Additional information regarding these and other factors can be found in our reports filed with the U.S. Securities and Exchange Commission.   In providing these forward-looking statements, the Company expressly disclaims any obligation to update these statements publicly or otherwise, whether as a result of new information, future events or otherwise, except as required by law.

All trademarks and service marks are the property of their respective owners.

For More Information Contact:

Investor Relations:
Steve West, Vice President, Investor Relations
Email: This email address is being protected from spambots. You need JavaScript enabled to view it. 
Phone: (781) 277-0007

Company Contact:
Howard Schacter, Chief Communications Officer
Email: This email address is being protected from spambots. You need JavaScript enabled to view it. 
Phone: (781) 277-0007

 

MariMed Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)

 March 31,
2024
 December 31,
2023
Assets   
Current assets:   
Cash and cash equivalents$15,234  $14,645 
Accounts receivable, net 6,491   7,199 
Inventory 29,044   25,306 
Deferred rents receivable 612   630 
Notes receivable, current portion 52   52 
Investments, current portion    88 
Due from related parties 181   105 
Other current assets 3,281   3,407 
Total current assets 54,895   51,432 
Property and equipment, net 90,765   89,103 
Intangible assets, net 12,819   17,012 
Goodwill 15,812   11,993 
Investments, net of current portion 274   221 
Notes receivable, net of current portion 814   814 
Operating lease right-of-use assets 9,456   9,716 
Finance lease right-of-use assets 3,539   3,295 
Other assets 12,958   12,537 
Total assets$201,332  $196,123 
    
Liabilities, mezzanine equity and stockholders’ equity   
Current liabilities:   
Mortgages and notes payable, current portion$1,057  $723 
Accounts payable 10,256   9,001 
Accrued expenses and other 4,613   3,549 
Income taxes payable 16,271   14,434 
Operating lease liabilities, current portion 1,955   1,945 
Finance lease liabilities, current portion 1,303   1,210 
Total current liabilities 35,455   30,862 
Mortgages and notes payable, net of current portion 67,448   65,652 
Operating lease liabilities, net of current portion 8,218   8,455 
Finance lease liabilities, net of current portion 2,290   2,140 
Other liabilities 100   100 
Total liabilities 113,511   107,209 
    
Commitments and contingencies   
    
Mezzanine equity   
Series B convertible preferred stock 14,725   14,725 
Series C convertible preferred stock 4,275   4,275 
Total mezzanine equity 19,000   19,000 
    
Stockholders’ equity   
Common stock 375   375 
Additional paid-in capital 171,389   171,144 
Accumulated deficit (101,253)  (99,955)
Noncontrolling interests (1,690)  (1,650)
Total stockholders’ equity 68,821   69,914 
Total liabilities, mezzanine equity and stockholders’ equity$201,332  $196,123 
        

MariMed Inc.
Condensed Consolidated Statements of Operations
(in thousands, except percentages and per share amounts)
(unaudited)

 Three months ended
 March 31,
  2024   2023 
    
Revenue$37,933  $34,380 
Cost of revenue 21,461   18,992 
Gross profit 16,472   15,388 
    
Gross margin 43.4%  44.8%
    
Operating expenses:   
Personnel 6,465   4,656 
Marketing and promotion 1,762   1,146 
General and administrative 6,140   4,305 
Acquisition-related and other 84   190 
Bad debt    (44)
Total operating expenses 14,451   10,253 
    
Income from operations 2,021   5,135 
    
Interest and other (expense) income:   
Interest expense (1,629)  (2,505)
Interest income 26   99 
Other expense, net (20)  (900)
Total interest and other expense, net (1,623)  (3,306)
    
Income before income taxes 398   1,829 
Provision for income taxes 1,690   2,493 
    
Net loss (1,292)  (664)
Less: Net income (loss) attributable to noncontrolling interests 6   (19)
Net loss attributable to common stockholders$(1,298) $(645)
    
Net loss per share attributable to common stockholders:   
Basic$(0.00) $(0.00)
Diluted$(0.00) $(0.00)
    
Weighted average common shares outstanding:   
Basic 375,211   342,794 
Diluted 375,211   342,794 
        

MariMed Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

 Three months ended
 March 31,
  2024   2023 
Cash flows from operating activities:   
Net loss attributable to common stockholders$(1,298) $(645)
Net income (loss) attributable to noncontrolling interests 6   (19)
Adjustments to reconcile net income (loss) to cash provided by operating activities:   
Depreciation and amortization of property and equipment 1,938   986 
Amortization of intangible assets 374   557 
Stock-based compensation 244   208 
Amortization of original debt issuance discount    55 
Amortization of debt discount 87   328 
Amortization of debt issuance costs 18    
Payment-in-kind interest 14   118 
Present value adjustment of notes payable    719 
Bad debt income    (44)
Obligations settled with common stock 1   1 
Write-off of disposed assets 1   906 
Gain on finance lease adjustment    (13)
Loss on changes in fair value of investments 121   20 
Changes in operating assets and liabilities:   
Accounts receivable, net 707   (132)
Deferred rents receivable 18   18 
Inventory (3,738)  (3,246)
Other current assets 391   639 
Other assets 63   19 
Accounts payable 1,334   (1,961)
Accrued expenses and other 1,091   (207)
Income taxes payable 1,838   (2,806)
Net cash provided by (used in) operating activities 3,210   (4,499)
    
Cash flows from investing activities:   
Purchases of property and equipment (3,368)  (3,052)
Business acquisitions, net of cash acquired    (2,995)
Advances toward future business acquisitions (485)  (300)
Purchases of investments (86)   
Purchases of cannabis licenses (265)  (601)
Proceeds from notes receivable 13   43 
Due from related party (75)  (20)
Net cash used in investing activities (4,266)  (6,925)
    
Cash flows from financing activities:   
Proceeds from term loan    29,100 
Proceeds from Construction to Permanent Commercial Real Estate Mortgage Loan 1,047    
Proceeds from mortgages 1,163    
Principal payments of mortgages (65)  (203)
Principal payments of promissory notes (135)  (9)
Repayment and retirement of promissory notes    (5,503)
Principal payments of finance leases (320)  (69)
Distributions (45)  (34)
Net cash provided by financing activities 1,645   23,282 
    
Net increase in cash and cash equivalents 589   11,858 
Cash and equivalents, beginning of year 14,645   9,737 
Cash and cash equivalents, end of period$15,234  $21,595 
        

MariMed Inc.
Reconciliation of Non-GAAP and GAAP Financial Measures
(in thousands, except percentages)
(unaudited)

 Three months ended
 March 31,
  2024   2023 
Non-GAAP Adjusted EBITDA   
GAAP Income from operations$2,021  $5,135 
Depreciation and amortization of property and equipment 1,938   986 
Amortization of acquired intangible assets 374   557 
Stock-based compensation 244   206 
Acquisition-related and other 84   190 
Adjusted EBITDA$4,661  $7,074 
    
Non-GAAP Adjusted EBITDA Margin (Non-GAAP adjusted EBITDA as a percentage of revenue)   
GAAP Income from operations 5.3%  14.9%
Depreciation and amortization of property and equipment 5.2%  2.9%
Amortization of acquired intangible assets 1.0%  1.6%
Stock-based compensation 0.6%  0.6%
Acquisition-related and other 0.2%  0.6%
Adjusted EBITDA margin 12.3%  20.6%
        

 

GAAP Gross margin43.4% 44.8%
Amortization of acquired intangible assets0.4% 0.8%
Non-GAAP Gross margin43.8% 45.6%

 

GAAP Net loss$(1,292) $(664)
Amortization of acquired intangible assets 374   557 
Stock-based compensation 244   206 
Acquisition-related and other 84   190 
Non-GAAP Net (loss) income$(590) $289 
        

MariMed Inc.
Supplemental Information
Revenue Components
(in thousands)
(unaudited)

 Three months ended
 March 31,
  2024  2023
Product revenue:   
Product revenue - retail 22,346  23,183
Product revenue - wholesale 14,505  10,376
Total product revenue 36,851  33,559
Other revenue 1,082  821
Total revenue$37,933 $34,380

Sign Up To Get Daily Green Stock News In Your Inbox

Please review our Disclaimer and Privacy Policy before subscribing.

STOCK QUOTE

FEATURED GREEN STOCK

GreenPower Motor

GreenPower Motor designs, builds and distributes a full suite of high-floor and low-floor all-electric medium and heavy-duty vehicles, including transit buses, school buses, shuttles, cargo van, and a cab and chassis...

CLICK TO LEARN MORE

FEATURED GREEN STOCK

Pond Technologies

Pond Technologies has developed a proprietary system that can profitably transform CO2 into valuable products. The company's carbon business focuses on absorbing greenhouse gas emissions, transforming these into...

CLICK TO LEARN MORE

COPYRIGHT ©2022 GREEN STOCK NEWS