Schwazze Announces Fourth Quarter & Full Year 2021 Results
Research, News, and Market Data on Schwazze
Revenue Increases 352% to $108.4 Million Compared to $24.0 Million for the year-ended 2020
Net Income attributed to Common Shareholders of $7.2 Million Compared to
Net Loss of ($19.4) Million for year-ended 2020
Adjusted EBITDA of 29.7% Compared to (31.7%) for the year-ended 2020
MSO Status Achieved with New Mexico Entry – Continuing Aggressive Acquisition Plan
Completed Transformational $95 Million Raise
Guidance
Q4 2022 Projected Revenue Annualized Run Rate of Approximately $220 Million – $260 Million
Q4 2022 Projected Adjusted EBITDA Annualized Run Rate of Approximately $70 Million – $82 Million
Conference Call & Webcast Scheduled for Today – 4:30 pm ET
DENVER, CO – March 31, 2022 – Schwazze, (OTCQX:SHWZ; NEO:SHWZ) (“Schwazze” or the “Company”), today announced financial results for the fourth quarter (“Q4-2021”) and for the year ended (“Y-E”) December 31, 2021 (“Y-E 2021”).
Y-E 2021 Financial Summary:
- Revenues of $108.4 million grew 352% compared to $24.0 million Y-E 2020
- Gross Margin of $49.4 million was 629% better than YE 2020 and 1,730 bps over Y-E 2020
- Net Income Attributed to Common Shareholders was $7.2 million or $0.17 Basic Earnings per share compared to a Net Loss of ($19.4) million in 2020 or ($0.47) Basic Loss per share
- Adjusted EBITDA of $32.2 million was 29.7% of revenue, compared to a loss of ($7.6) million Y-E 2020
- Cash Flow from operations for Y-E 2021 was $57.3 million(1) compared to ($9.8) million Y-E 2020
- Retail Sales were $73.7 million and when compared to last year Retail Sales were up 1,811%
- Two year stacked IDs for same store sales(2) were 47.3% and one year IDs were 13.3%
- Average basket size(2) for 2021 was $59.70 up 9.5% compared to Y-E 2020
- Recorded customer visits(2) for 2021 totaled 1,375,589 up 3.8%, compared to Y-E 2020
Q4 2021 Financial Summary:
- Revenues of $26.5 million grew 234% compared to $7.9 million in Q4 2020
- Gross Margin of $12.1 million was 1,856% better than Q4 2020 and 3,798 bps over Q4 2020
- Net Income Attributed to Common Shareholders was $5.5 million compared to a Net Loss of ($8.5) million for the same period last year
- Adjusted EBITDA of $7.5 million for the quarter was 28.3% of revenue, compared to a loss of ($3.4) million for the same period last year
- Cash Flow from operations for the quarter was $52.5 million(1) compared to ($3.5) million for the same period last year
- Retail sales for the quarter were $19.6 million and were up 887% when compared to the same period last year
- Two year stacked IDs for Q4 2021 compared to Q4 2019 for same store sales(2) were 40.4% and one year IDs(2) were 4.9% comparing Q4 2021 to Q4 2020
- Average basket size(2) for Q4 2021 was $59.70 up 12.1% compared to Q4 2020
- Recorded customer visits(2) for Q4 2021 totaled 329,357 down 7.2%, compared to Q4 2020
Accomplishments for Y-E 2021 and Q1 2022
Since April 2020, Schwazze has acquired or announced the planned acquisition of 33 cannabis dispensaries as well as seven cultivation facilities and two manufacturing assets in Colorado and New Mexico.
Q1 2022
- Listed Common Shares of Schwazze onto the NEO Exchange
- Signed Definitive Agreement to Acquire Assets of Urban Health & Wellness
- Closed Acquisition of Brow 2 LLC Assets
- Closed Acquisition of Emerald Fields
- Added President of New Mexico Division
- Closed New Mexico Acquisition, Becoming a Regionally Focused MSO
- Added to Key Senior Leadership Team
- Closed Acquisition of Drift Assets
2021
- Closed Acquisition of Smoking Gun Assets
- Announced Convertible Debt Raise
- Announced Home Delivery Services
- Closed Acquisition of Southern Colorado Growers Assets
- Announced R&D Subsidiary, Schwazze BioSciences, LLC
- Completed Acquisition of Final Seven Star Buds
“2021 was a transformational year for Schwazze as we became an MSO with a super-regional focus and a clear strategy to “go deep” in the states we are now operating in. Our private capital raise of $95 million provided momentum for our M&A and organic growth strategy. The Company’s stock was listed on the NEO Exchange, earlier this month, providing an additional platform for liquidity and awareness of our stock for retail and institutional investors,” stated Justin Dye, CEO of Schwazze. “To date, Schwazze has acquired or announced the acquisition of 33 dispensaries, of which 14 were closed in the first quarter of 2022. Revenue for the year was $108.4 million, up 352%, and our retail numbers were $73.7 million, up 1,811%. Our wholesale business continued to win customers and delivered 85% revenue growth. We continued our upward trend with an increase in average basket size of 9.5% and customer visits by 3.8% year over year. I am proud of our entire team, as Schwazze, once again outpaced the state of Colorado by 11.3%.”
Y-E 2021 Revenue
Total revenue was $108.4 million for the year ended March 31, 2021, compared to $24.0 million during the same period in 2020 and represents an increase of approximately 352%. Retail sales were $73.7 million for 2021 from $3.9 million dollars the previous year representing a 1,811% increase driven primarily by acquisitions of dispensaries in Colorado. Wholesale operations revenue increased to $34.4 million from $18.6 million compared to the previous year representing an 85% increase, primarily driven by acquisition of cultivation facilities and increase in sales of distillate products to the market. Other sales were $0.3 million from $1.5 million the previous year, primarily driven by the pivoting away consulting sales.
Total cost of goods and services for the year totaled $59.1 million compared to $17.2 million during the same period in 2020, representing an increase of 243%, due to increased sales of products and growth through acquisition.
Gross profit increased to $49.4 million for the year compared to $6.8 million during the same period in 2020. Gross profit margin rose as a percentage of revenue from 28.2% to 45.5%, continued to be driven by the strength of the Star Buds acquisition, our consolidated purchasing approach, and the implementation of our retail playbook.
The Average basket size for 2021 was $59.70 up 9.5%, compared to 2020(2). Recorded customer visits totaled 1,375,589 up 3.8%, compared to 2020(2).
Total operating expenses were $38.9 million for the year compared to $29.7 million during the same period in 2020. The higher expenses are attributed to increased selling, general and administrative expenses, salaries, benefits, and related employment costs.
Net income attributed to common shareholders for the year was $7.2 million or $0.17 basic earnings per share, compared to a net loss of ($19.4) million or ($0.47) basic earnings per share for the same period last year.
Adjusted EBITDA for the year was $32.2 million representing 29.7% of revenue., compared to a loss of ($7.6) million for the same period last year. This is derived from Operating Income and adjusting one-time expenses, merger and acquisition and capital raising costs, non-cash related compensation costs, and depreciation and amortization. See the financial table for Adjusted EBITDA below adjustment for details.
For the year ended 2021, the Company generated a positive operating cash flow of $57.3 million(1) compared to a loss of ($9.8) million for the same period with $106.4 million in cash and cash equivalents for the year ended 2021.
Nancy Huber, CFO for Schwazze commented, “we’ve delivered an excellent year with the continued generation of operating cash flows from our acquired businesses. With funds from operations as well as our recent raise, we will continue to deploy capital in new acquisitions and improve our stores, manufacturing, and cultivation operations. We expect to deploy approximately $15 million for capital improvements in our businesses this year.”
2022 Guidance
The Company is providing guidance for a fourth-quarter 2022 (“Q4 2022”) annualized run rate, which excludes transactions that are announced but not closed. Q4 2022 revenue annualized run rate is projected to be approximately $220 Million – $260 Million, and the projected Q4 2022 adjusted EBITDA annualized run rate is projected to be from $70 million to $82 million.
NOTES:
- $34.9 million of this year’s operating cash flow was derived from the derivative liability associated with the convertible debt issued in December.
- Schwazze did not own all the assets and entities in part of 2021, 2020 and 2019 and is using unaudited numbers for this comparison.
Adjusted EBITDA represents income (loss) from operations, as reported, before tax, adjusted to exclude non-recurring items, other non-cash items, including stock-based compensation expense, depreciation, and amortization, and further adjusted to remove acquisition and capital raise related costs, and other one-time expenses, such as severance, retention, and employee relocation. The Company uses adjusted EBITDA as it believes it better explains the results of its core business. The Company has not reconciled guidance for adjusted EBITDA to the corresponding GAAP financial measure because it cannot provide guidance for the various reconciling items. The Company is unable to provide guidance for these reconciling items because it cannot determine their probable significance, as certain items are outside of its control and cannot be reasonably predicted. Accordingly, a reconciliation to the corresponding GAAP financial measure is not available without unreasonable effort.
Webcast – March 31, 2022 – 4:30 ET
Investors and stakeholders may participate in the conference call by dialing 416 764 8650 or by dialing North American toll free 888-664-6383 or by listening to the webcast from the Company’s website at https://ir.schwazze.com. The webcast will be available on the Company’s website and on replay until April 7, 2022 and accessed by dialing 888-390-0541 / 040354#.
Following their prepared remarks, Chief Executive Officer, Justin Dye and Chief Financial Officer, Nancy Huber will answer investor questions. Investors may submit questions in advance or during the conference call through the weblink: https://produceredition.webcasts.com/starthere.jsp?ei=1531076&tp_key=128c98ab58 This weblink has been posted to the Company’s website and will be archived on the website. All Company SEC filings can also be accessed on the Company website at https://ir.schwazze.com/sec-filings
About Schwazze
Schwazze (OTCQX: SHWZ) is building a premier vertically integrated regional cannabis company with assets in Colorado and New Mexico and will continue to take its operating system to other states where it can develop a differentiated regional leadership position. Schwazze is the parent company of a portfolio of leading cannabis businesses and brands spanning seed to sale. The Company is committed to unlocking the full potential of the cannabis plant to improve the human condition. Schwazze is anchored by a high- performance culture that combines customer-centric thinking and data science to test, measure, and drive decisions and outcomes. The Company’s leadership team has deep expertise in retailing, wholesaling, and building consumer brands at Fortune 500 companies as well as in the cannabis sector. Schwazze is passionate about making a difference in our communities, promoting diversity and inclusion, and doing our part to incorporate climate-conscious best practices. Medicine Man Technologies, Inc. was Schwazze’s former operating trade name. The corporate entity continues to be named Medicine Man Technologies, Inc. Schwazze derives its name from the pruning technique of a cannabis plant to enhance plant structure and promote healthy growth.
Forward-Looking Statements
This press release contains “forward-looking statements.” Such statements may be preceded by the words “plan,” “will,” “may,” “continue,” “predicts,” or similar words. Forward-looking statements include the guidance provided regarding the Company’s Q4 2022 performance and annual capital spending. Forward-looking statements are not guarantees of future events or performance, are based on certain assumptions, and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company’s control and cannot be predicted or quantified. Consequently, actual events and results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) our inability to manufacture our products and product candidates on a commercial scale on our own or in collaboration with third parties; (ii) difficulties in obtaining financing on commercially reasonable terms; (iii) changes in the size and nature of our competition; (iv) loss of one or more key executives or scientists; (v) difficulties in securing regulatory approval to market our products and product candidates; (vi) our ability to successfully execute our growth strategy in Colorado and outside the state, (vii) our ability to identify and consummate future acquisitions that meet our criteria, (viii) our ability to successfully integrate acquired businesses and realize synergies therefrom, (ix) the ongoing COVID-19 pandemic, (x) the timing and extent of governmental stimulus programs, (xi) the uncertainty in the application of federal, state and local laws to our business, and any changes in such laws, and (xii) our ability to achieve the target metrics, including our annualized revenue and EBIDTA run rates set out in our Q4 2022 guidance. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC’s website at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise except as required by law.
|
Investors
Joanne Jobin
Investor Relations
Joanne.jobin@schwazze.com
647 964 0292
|
Daniel Pabon
General Counsel
dan@schwazze.com
303-371-0387 x1031
|
Media
Julie Suntrup, Schwazze
Vice President | Marketing & Merchandising
julie.suntrup@schwazze.com
303 371 0387
|
MEDICINE MAN TECHNOLOGIES, INC.
CONDENSED BALANCE SHEETS
For the Years Ended December 31, 2021 and 2020
Expressed in U.S. Dollars
|
|
|
December 31
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
ASSETS
|
|
|
(Audited)
|
|
|
|
(Audited)
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
106,400,216
|
|
|
$
|
1,231,235
|
|
|
Accounts receivable, net of allowance for doubtful accounts
|
|
|
3,866,828
|
|
|
|
1,270,380
|
|
|
Accounts receivable – related party
|
|
|
–
|
|
|
|
80,494
|
|
|
Inventory
|
|
|
11,121,997
|
|
|
|
2,619,145
|
|
|
Note receivable – current, net
|
|
|
–
|
|
|
|
–
|
|
|
Note receivable – related party
|
|
|
–
|
|
|
|
181,911
|
|
|
Prepaid expenses and other current assets
|
|
|
2,523,214
|
|
|
|
614,200
|
|
|
Total current assets
|
|
|
123,912,255
|
|
|
|
5,997,365
|
|
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
Fixed assets, net accumulated depreciation of $1,988,973 and $872,579, respectively
|
|
|
10,253,226
|
|
|
|
2,584,798
|
|
|
Goodwill
|
|
|
43,316,267
|
|
|
|
53,046,729
|
|
|
Intangible assets, net accumulated amortization of $7,652,750 and $200,456, respectively
|
|
|
97,582,330
|
|
|
|
3,082,044
|
|
|
Marketable securities, net of unrealized gain (loss) of $216,771 and $(129,992), respectively
|
|
|
493,553
|
|
|
|
276,782
|
|
|
Note receivable – noncurrent, net
|
|
|
143,333
|
|
|
|
–
|
|
|
Accounts receivable – litigation
|
|
|
303,086
|
|
|
|
3,063,968
|
|
|
Other noncurrent assets
|
|
|
514,962
|
|
|
|
51,879
|
|
|
Operating lease right of use assets
|
|
|
8,511,780
|
|
|
|
2,579,036
|
|
|
Total non-current assets
|
|
|
161,118,537
|
|
|
|
64,685,236
|
|
|
Total assets
|
|
$
|
285,030,792
|
|
|
$
|
70,682,601
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
2,548,885
|
|
|
$
|
3,508,478
|
|
|
Accounts payable – related party
|
|
|
36,820
|
|
|
|
48,982
|
|
|
Accrued expenses
|
|
|
5,592,222
|
|
|
|
2,705,445
|
|
|
Derivative liabilities
|
|
|
34,923,013
|
|
|
|
1,047,481
|
|
|
Deferred revenue
|
|
|
–
|
|
|
|
50,000
|
|
|
Notes payable – related party
|
|
|
134,498
|
|
|
|
5,000,000
|
|
|
Income taxes payable
|
|
|
2,027,741
|
|
|
|
–
|
|
|
Total current liabilities
|
|
|
45,263,179
|
|
|
|
12,360,386
|
|
|
Long term debt
|
|
|
97,482,468
|
|
|
|
13,901,759
|
|
|
Lease liabilities
|
|
|
8,715,480
|
|
|
|
2,645,597
|
|
|
Total long-term liabilities
|
|
|
106,197,948
|
|
|
|
16,547,356
|
|
|
Total liabilities
|
|
|
151,461,127
|
|
|
|
28,907,742
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity
|
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value. 250,000,000 shares authorized; 45,455,490 shares issued and 44,717,046 shares outstanding at December 31, 2021 and 42,601,773 shares issued and 42,169,041 shares outstanding as of December 31, 2020, respectively
|
|
|
45,485
|
|
|
|
42,602
|
|
|
Preferred stock, $0.001 par value. 10,000,000 shares authorized; 86,994 shares issued and outstanding at December 31, 2021 and 10,000,000 shares authorized; 19,716 shares issued and outstanding at December 31, 2020
|
|
|
87
|
|
|
|
20
|
|
|
Additional paid-in capital
|
|
|
162,815,097
|
|
|
|
85,357,835
|
|
|
Accumulated deficit
|
|
|
(27,773,968
|
)
|
|
|
(42,293,098
|
)
|
|
Common stock held in treasury, at cost, 517,044 shares held as of December 31, 2021 and 432,732 shares held as of December 31, 2020.
|
|
|
(1,517,036
|
)
|
|
|
(1,332,500
|
)
|
|
Total stockholders’ equity
|
|
|
133,569,665
|
|
|
|
41,774,859
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
285,030,792
|
|
|
$
|
70,682,601
|
|
See accompanying notes to the financial statements
MEDICINE MAN TECHNOLOGIES, INC.
CONDENSED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)
For the Quarters & Years Ended December 31, 2021 and 2020
Expressed in U.S. Dollars
|
|
Quarter Ended
|
|
Quarter Ended
|
|
Year Ended
|
|
Year Ended
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
(Un-audited)
|
|
|
|
(Un-audited)
|
|
|
|
(Audited)
|
|
|
|
(Audited)
|
|
|
Operating revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail
|
$
|
19,639,774
|
|
|
$
|
1,990,334
|
|
|
$
|
73,723,654
|
|
|
$
|
3,858,613
|
|
|
Wholesale
|
|
6,816,482
|
|
|
|
5,738,755
|
|
|
|
34,471,447
|
|
|
|
18,647,780
|
|
|
Other
|
|
59,722
|
|
|
|
213,926
|
|
|
|
225,138
|
|
|
|
1,494,459
|
|
|
Total revenue
|
|
26,515,978
|
|
|
|
7,943,015
|
|
|
|
108,420,239
|
|
|
|
24,000,852
|
|
|
Cost of goods and services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods and services
|
|
14,373,780
|
|
|
|
7,322,355
|
|
|
|
59,066,545
|
|
|
|
17,226,486
|
|
|
Total cost of goods and services
|
|
14,373,780
|
|
|
|
7,322,355
|
|
|
|
59,066,545
|
|
|
|
17,226,486
|
|
|
Gross profit
|
|
12,142,198
|
|
|
|
620,660
|
|
|
|
49,353,694
|
|
|
|
6,774,366
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses
|
|
3,035,837
|
|
|
|
1,469,512
|
|
|
|
16,616,306
|
|
|
|
4,523,603
|
|
|
Professional services
|
|
880,238
|
|
|
|
3,155,114
|
|
|
|
5,346,934
|
|
|
|
8,545,300
|
|
|
Salaries
|
|
3,437,676
|
|
|
|
2,404,407
|
|
|
|
11,943,409
|
|
|
|
8,377,889
|
|
|
Stock based compensation
|
|
1,172,291
|
|
|
|
2,414,705
|
|
|
|
5,037,879
|
|
|
|
8,230,513
|
|
|
Total operating expenses
|
|
8,526,042
|
|
|
|
9,443,738
|
|
|
|
38,944,528
|
|
|
|
29,677,305
|
|
|
Income (loss) from operations
|
|
3,616,156
|
|
|
|
(8,823,078
|
)
|
|
|
10,409,166
|
|
|
|
(22,902,939
|
)
|
|
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income (expense), net
|
|
(2,487,533
|
)
|
|
|
(88,186
|
)
|
|
|
(7,014,279
|
)
|
|
|
(41,460
|
)
|
|
Gain on forfeiture of contingent consideration
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
1,462,636
|
|
|
Unrealized gain (loss) on derivative liabilities
|
|
14,093,391
|
|
|
|
(264,586
|
)
|
|
|
15,061,142
|
|
|
|
1,263,264
|
|
|
Other income (expense)
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
32,621
|
|
|
Gain (loss) on sale of assets
|
|
–
|
|
|
|
–
|
|
|
|
242,494
|
|
|
|
–
|
|
|
Unrealized gain (loss) on investments
|
|
6,086
|
|
|
|
(250,792
|
)
|
|
|
216,771
|
|
|
|
(129,992
|
)
|
|
Total other income (expense)
|
|
11,611,944
|
|
|
|
(603,564
|
)
|
|
|
8,506,128
|
|
|
|
2,587,069
|
|
|
Provision for income taxes (benefit)
|
|
2,398,259
|
|
|
|
(899,109
|
)
|
|
|
4,396,164
|
|
|
|
(899,109
|
)
|
|
Net income (loss)
|
$
|
12,829,841
|
|
|
$
|
(8,527,533
|
)
|
|
$
|
14,519,130
|
|
|
$
|
(19,416,761
|
)
|
|
Less: Accumulated preferred stock dividends for the period
|
|
(7,346,153
|
)
|
|
|
–
|
|
|
|
(7,346,153)
|
|
|
|
–
|
|
|
Net income (loss) attributable to common stockholders
|
$
|
5,483,688
|
|
|
$
|
(8,527,533
|
)
|
|
$
|
7,172,977
|
|
|
$
|
(19,416,761
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share attributable to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share
|
$
|
0.13
|
|
|
$
|
(0.21)
|
|
|
$
|
0.17
|
|
|
$
|
(0.47
|
)
|
|
Diluted earnings (loss) per share
|
|
|
|
|
|
|
|
|
$
|
(0.06
|
)
|
|
$
|
(0.47
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding – basic
|
|
43,339,092
|
|
|
|
41,217,026
|
|
|
|
43,339,092
|
|
|
|
41,217,026
|
|
|
Weighted average number of shares outstanding – diluted
|
|
|
|
|
|
|
|
|
|
101,368,958
|
|
|
|
41,217,026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
$
|
12,829,841
|
|
|
$
|
(8,527,533
|
)
|
|
$
|
14,519,130
|
|
|
$
|
(19,416,761
|
)
|
See accompanying notes to the financial statements
MEDICINE MAN TECHNOLOGIES, INC.
STATEMENT OF CASH FLOWS (UNAUDITED)
For the Quarters & Years Ended December 31, 2021 and 2020
Expressed in U.S. Dollars
|
|
Quarter Ended
|
|
Quarter Ended
|
|
Year Ended
|
|
Year Ended
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) for the period
|
$
|
12,829,841
|
|
|
$
|
(8,527,533
|
)
|
|
$
|
14,519,130
|
|
|
$
|
(19,416,761
|
)
|
|
|
Adjustments to reconcile net income to cash used in operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
797,037
|
|
|
|
154,300
|
|
|
|
8,576,865
|
|
|
|
476,592
|
|
|
|
Deferred taxes
|
|
–
|
|
|
|
268,423
|
|
|
|
–
|
|
|
|
268,423
|
|
|
|
(Gain) loss on change in derivative liabilities
|
|
34,843,283
|
|
|
|
264,585
|
|
|
|
33,875,532
|
|
|
|
(2,725,901
|
)
|
|
|
(Gain) loss on investment, net
|
|
(6,086
|
)
|
|
|
250,792
|
|
|
|
(216,771
|
)
|
|
|
129,992
|
|
|
|
(Gain) loss on sale of assets
|
|
49,985
|
|
|
|
–
|
|
|
|
(242,494
|
)
|
|
|
–
|
|
|
|
Stock based compensation
|
|
1,172,291
|
|
|
|
2,414,705
|
|
|
|
5,037,879
|
|
|
|
8,230,513
|
|
|
|
Changes in operating assets and liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
2,424,575
|
|
|
|
(417,893
|
)
|
|
|
244,929
|
|
|
|
874,616
|
|
|
|
Inventory
|
|
(1,668,940
|
)
|
|
|
510,207
|
|
|
|
(4,703,186
|
)
|
|
|
781,512
|
|
|
|
Prepaid expenses and other current assets
|
|
55,821
|
|
|
|
(359,598
|
)
|
|
|
(1,909,014
|
)
|
|
|
(84,784
|
)
|
|
|
Other assets
|
|
(60,900
|
)
|
|
|
76,121
|
|
|
|
(457,083
|
)
|
|
|
(51,878
|
)
|
|
|
Operating leases right of use assets and liabilities
|
|
23,010
|
|
|
|
32,673
|
|
|
|
137,139
|
|
|
|
59,701
|
|
|
|
Accrued interest on notes receivable
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
Accounts payable and other liabilities
|
|
1,062,106
|
|
|
|
1,787,521
|
|
|
|
493,719
|
|
|
|
1,610,226
|
|
|
|
Deferred revenue
|
|
–
|
|
|
|
50,000
|
|
|
|
(50,000
|
)
|
|
|
50,000
|
|
|
|
Income taxes payable
|
|
998,259
|
|
|
|
–
|
|
|
|
2,027,741
|
|
|
|
(1,940
|
)
|
|
|
Net cash provided by (used in) operating activities
|
|
52,520,282
|
|
|
|
(3,495,697
|
)
|
|
|
57,334,386
|
|
|
|
(9,799,689
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collection (issuance) of notes receivable
|
|
–
|
|
|
|
349,210
|
|
|
|
181,911
|
|
|
|
827,495
|
|
|
|
Cash consideration for acquisition of business
|
|
(3,750,929
|
)
|
|
|
(30,668,962
|
)
|
|
|
(75,678,000
|
)
|
|
|
(33,278,462
|
)
|
|
|
Purchase of fixed assets – net
|
|
(1,768,427
|
)
|
|
|
208,512
|
|
|
|
(5,638,085
|
)
|
|
|
(768,173
|
)
|
|
|
Purchase of intangible assets
|
|
–
|
|
|
|
–
|
|
|
|
(29,580
|
)
|
|
|
–
|
|
|
|
Net cash provided by (used in) investing activities
|
|
(5,519,356
|
)
|
|
|
(30,111,240
|
)
|
|
|
(81,163,754
|
)
|
|
|
(33,219,140
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of debt, net
|
|
38,236,131
|
|
|
|
13,901,759
|
|
|
|
83,580,709
|
|
|
|
13,901,759
|
|
|
|
Repayment of notes payable
|
|
–
|
|
|
|
5,000,000
|
|
|
|
(4,865,502
|
)
|
|
|
5,000,000
|
|
|
|
Proceeds from issuance of common stock, net of issuance costs
|
|
345
|
|
|
|
12,583,312
|
|
|
|
50,283,142
|
|
|
|
12,625,312
|
|
|
|
Proceeds from exercise of common stock purchase warrants, net of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
issuance costs
|
|
–
|
|
|
|
374,810
|
|
|
|
|
|
|
|
374,810
|
|
|
|
Net cash provided by financing activities
|
|
38,236,476
|
|
|
|
31,859,881
|
|
|
|
128,998,349
|
|
|
|
31,901,881
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
85,237,402
|
|
|
|
(1,747,056
|
)
|
|
|
105,168,981
|
|
|
|
(11,116,948
|
)
|
|
|
Cash and cash equivalents at beginning of period
|
|
21,162,814
|
|
|
|
2,978,291
|
|
|
|
1,231,235
|
|
|
|
12,348,183
|
|
|
|
Cash and cash equivalents at end of period
|
$
|
106,400,216
|
|
|
$
|
1,231,235
|
|
|
$
|
106,400,216
|
|
|
|
1,231,235
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the financial statements
MEDICINE MAN TECHNOLOGIES, INC.
Adjusted EBITDA Reconciliation
Non-GAAP measurement
(UNAUDITED)
|
|
Quarter Ended
|
|
Quarter Ended
|
|
Year Ended
|
|
Year Ended
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
Net income (loss)
|
|
$12,829,841
|
|
|
|
$(8,527,533)
|
|
|
|
$14,519,130
|
|
|
|
$(19,416,761)
|
|
|
Interest income (expense), net
|
|
2,487,533
|
|
|
|
88,186
|
|
|
|
7,014,279
|
|
|
|
41,460
|
|
|
Provision for income taxes (benefit)
|
|
2,398,259
|
|
|
|
(899,109)
|
|
|
|
4,396,164
|
|
|
|
(899,109)
|
|
|
Other (income) expense
|
|
(14,099,477)
|
|
|
|
515,378
|
|
|
|
(15,520,407)
|
|
|
|
(2,628,529)
|
|
|
Depreciation and amortization
|
|
797,037
|
|
|
|
154,300
|
|
|
|
8,576,865
|
|
|
|
476,592
|
|
|
Earnings before interest, taxes, depreciation and amortization (EBITDA) (non-GAAP measure)
|
|
$4,413,193
|
|
|
|
$(8,668,778)
|
|
|
|
$18,986,031
|
|
|
|
$(22,426,347)
|
|
|
Non-cash stock compensation
|
|
1,172,291
|
|
|
|
2,414,705
|
|
|
|
5,037,879
|
|
|
|
8,230,513
|
|
|
Deal related expenses
|
|
712,049
|
|
|
|
831,007
|
|
|
|
2,779,151
|
|
|
|
3,684,553
|
|
|
Capital raise related expenses
|
|
256,321
|
|
|
|
797,358
|
|
|
|
1,512,565
|
|
|
|
1,337,708
|
|
|
Severance
|
|
5,054
|
|
|
|
702,874
|
|
|
|
166,557
|
|
|
|
989,864
|
|
|
Retention program expenses
|
|
1,188
|
|
|
|
–
|
|
|
|
90,250
|
|
|
|
–
|
|
|
Employee relocation expenses
|
|
2,428
|
|
|
|
(6,333)
|
|
|
|
40,819
|
|
|
|
27,491
|
|
|
Other non-recurring items
|
|
939,718
|
|
|
|
547,523
|
|
|
|
3,552,836
|
|
|
|
547,523
|
|
|
Adjusted EBITDA (non-GAAP measure)
|
|
$7,502,242
|
|
|
|
$(3,381,644)
|
|
|
|
$32,166,088
|
|
|
|
$(7,608,695)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
