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NEW YORK and TORONTO, Aug. 28, 2018 /PRNewswire/ – iAnthus Capital Holdings, Inc. (“iAnthus” or the “Company”), (CSE: IAN, OTCQB: ITHUF), which owns, operates, and partners with licensed cannabis operations throughout the United States, is pleased to announce its financial and operating results for the second quarter of 2018 (“Q2 2018”). All amounts expressed are in USD.
- Assets increased to $142.2 million at June 30, 2018 from $45.8 million at December 31, 2017, an increase of 310%, as a result of the acquisitions in Florida and New York as well as the continued build-out of cultivation facilities and dispensaries across the operating entitles;
- The Company recorded $4.9 million of revenues for the six months ended June 30, 2018. Total revenues include the Company’s cannabis revenues from Florida and Vermont totaling $0.5 million, in addition to $3.9 million in fair value adjustments on biological assets, which represents results from the Company’s cultivation operations;
- The net loss for the six months ended June 30, 2018 was approximately $36.2 million. There were significant non-cash expenses totaling approximately $26.1 million in the net loss for the six months ended June 30, 2018. Non-cash expenses include $13.3 million from accretion expenses primarily due to the early repayment of the $20.0 million January 2018 debentures, and $8.2 million from revaluations on the fair value of derivative instruments as a result of the significant increase in the Company’s share price since the issuance of the instruments;
- On May 14, 2018, the Company received a $50.0 million investment from Gotham Green Partners. The proceeds of the financing were allocated to repay principal and interest on the $20.0 million of unsecured debentures issued in January 2018. In addition, the proceeds will be allocated to continued cultivation and dispensary build-outs in the Company’s key markets of New York and Florida, with the remainder to be utilized for potential expansion activities consistent with the Company’s strategic objectives; and
- On June 13, 2018, The Green Solution, LLC repaid the balance of its loan facility with a final principal payment to the Company of $3.5 million and accrued interest.
Developments Subsequent to the Quarter
- On July 16, 2018, the Company elected to convert all of the principal amount outstanding on the February 2017debentures and unpaid accrued interest up to July 13, 2018, into common shares of the Company. On August 16, 2018, the remaining balance of February 2017 debentures and accrued interest were converted into common shares of the Company.
Massachusetts – Mayflower Medicinals Highlights:
- Mayflower opened its flagship dispensary on July 19, 2018 in the Allston–Brighton neighborhood of Boston. The dispensary offers a full spectrum of cannabis products in the form of flower, tinctures, concentrates, oils, vaporizers, and edibles;
- Mayflower has signed a lease for a second dispensary location in Lowell, MA, and is currently pursuing permitting at the site. Lowell is the fourth-largest city in Massachusetts and the second-largest in the Boston metropolitan statistical area. Lowell is also home to two universities and receives 2 million visitors annually;
- At the close of Q2 2018, Mayflower was cultivating 4,243 plants, consisting of 38 different strains, compared to 2,670 plants cultivated as of Q1 2018. The Company recorded a gain on transformation of biological assets of $1.2 millionfor Q2 2018, compared to $0.5 million for Q1 2018;
- Mayflower has achieved the desired perpetual harvest cycle of harvesting 550 plants every ten days. Yields have continued to improve throughout 2018, with the most recent harvest yielding over 63,500 grams of usable plant material. Management expects yields will continue to increase up to approximately 90,000 grams of usable plant material every harvest;
- The Massachusetts adult use cannabis program began on July 1, 2018. Management estimates that the current statewide medical market size is already well over $100.0 million in annual revenue and, with a full adult use program in place, the market size is estimated to grow over $1.0 billion in annual revenues by 2020; and
- Mayflower has signed a Host Community Agreement with the Town of Holliston for an adult use permit for its cultivation and processing facility and will shortly begin the application process of applying for adult use cultivation and processing licenses. As recreational licensing processes are initiated by local regulatory officials, Mayflower will begin the application process for appropriate adult use licenses for its medical dispensary locations.
Florida – GrowHealthy Highlights:
- GrowHealthy continues to expand its retail footprint and has signed seven leases to-date, with eight additional leases currently in the pipeline. Signed leases include Miami, Deerfield Beach, West Palm Beach, Brandon, Tampa, Orlandoand Sarasota. The company is targeting 15 signed leases by the end of 2018 and expects to open its first three dispensaries in Q4 2018. Starting in 2019, the company projects to open approximately two dispensaries per quarter;
- As of August 24, 2018, GrowHealthy’s pilot delivery program is serving 546 unique patients. The delivery program serves as a test market in preparation for the Company’s upcoming dispensary openings;
- GrowHealthy currently utilizes its Lake Wales facility as its delivery hub and intends to add the Deerfield Beachdispensary location as its second hub in September 2018, allowing for improved delivery routes and shorter wait times for its patients across Florida. Three additional delivery vans have been purchased and are being retrofitted for use. Once complete, GrowHealthy’s fleet will increase to a total of five vans, allowing the Company to expand the frequency and geographic reach of its delivery program;
- At June 30, 2018, the cultivation facility housed over 2,900 plants consisting of 36 different strains. GrowHealthy is currently in the process of expanding its current 890 sq. ft. lab space to 15,000 sq. ft., including a commercial kitchen and increased processing capabilities and allowing for a wider array of products including edibles, metered flower, capsules, and topicals, which is expected to be complete in 2019;
- Since the implementation of a medical cannabis program in June 2017, the Florida market continues to show strong growth. As of August 24, 2018, the program has registered 153,884 patients and 1,653 qualified physicians. The program is adding approximately 12,000 patients and 80 physicians per month. In terms of patients, Florida is now the fourth largest medical cannabis market in the U.S.
New York – Citiva Highlights:
- Governor Cuomo has created a task force to draft legislation for the legalization of adult use marijuana in New York. The formation of this task force follows closely behind the release of a Department of Health report that recommended the full legalization of marijuana in New York, stating that “the positive effects of a regulated marijuana market in New York state outweigh the potential negative impacts”;
- On July 31, 2018, the Company held a groun