After a few years of steady growth, iAnthus Capital Holdings Inc (OTCMKTS:ITHUF), seems set to rocket through the charts. Its largest revenue for the last three years was only $0.15 million, but in the release of its 2018 first quarter results, the firm had already recorded revenues above $3 million. For early investors, this is the time to reap the rewards of their patience. In this piece, we give you details of the company, analyze its financial results and discuss its most recent press releases.
First, take a look at the stock’s price movement in the last year:
iAnthus Capital Holdings, Inc. was established by Randy Maslow and Hadley Ford in November 2013 and its head office is in New York, USA.
The firm specializes in the financing of licensed cannabis processors, cultivators, and dispensaries. Its portfolio also includes Organix, Grassroots Vermont, Mayflower Medicinals and R. Greenleaf. In addition, the company engages in delivering solutions for financing, developing, and managing state-licensed cannabis cultivators and dispensaries all located in the United States.
The firm recently announced that one of its affiliates, Mayflower Medicinals, Inc. has entered into a Host Community Agreement with the City of Lowell in Massachusetts, to run a Medical Marijuana Treatment Center located within the area.
Mayflower means to apply for a special permit at the site which if granted will enable the dispensary to become only the second operating dispensary within the Lowell city area.
Chief Development Officer, John Henderson, explained that the people of Massachusetts and the City of Lowell have complied with high program regulations which are strictly targeted at patient care and regulatory compliance. He added that Mayflower was honored to be able to successfully complete the host community agreement with Lowell, thus adding major value to the project by detailing a supportive affiliation between the city and the creation of the registered marijuana dispensary site
Mayflower is a not-for-profit Massachusetts entity which has already received two provisional licenses to run Registered Marijuana Dispensaries in Massachusetts, with its third RMD application still awaiting approval of the Massachusetts Department of Public Health. Mayflower is an affiliate of iAnthus’ wholly-owned management services company located in Massachusets, Pilgrim Rock Management, LLC, and Mayflower’s financial operations are consolidated with iAnthus
From the company’s recently released financial statements, it was made clear that the continued development of licensed operations and assets has helped iAnthus to successfully transition to an operator and owner within the U.S. regulated cannabis market.
Within the states of Florida, Massachusetts, Vermont, and New York, iAnthus has authorization operate up to four processing and cultivation facilities and thirty-four dispensaries. The firm has also made major investments in expanding its cultivation operations and dispensaries around each one of these states, which has led to increased production capacity and competitive retail sites.
At the end of 2017, iAnthus Capital Holdings reported total revenues figures of $0.15 million, a rise of 124% from the revenues of the previous year. Noticeably, this figure is the highest revenue recorded in the last three operating years, although the percentage increase in revenues has dropped across the years. There is clearly a huge market for the company’s cannabis products hence it is expected that sales will continue to go up, boosting income in the coming years.
Already at the end of the first quarter of 2018, the company recorded total revenues of $3.2 million, a much larger sum than last three years combined.
However, the firm recorded operating costs of $13.1 million, a huge jump from the previous year’s expenses a pointer that the firm may have lost some of its production efficiency given that the expense increase was so much more than the revenue jump.
As part of operating expenses, sales, general and administrative expenses jumped by 138%, while the firm incurred non-recurring expenses of $5.56 million during the year. Other costs rose significantly to $0.14 million, leading to operating loss figure for the year. Net loss for the year was $13.7million.
The statement of financial position reveals that the firm is somewhat highly geared. On its books, its total debt is worth an estimated $24.0 million, leading to stable debt to equity ratio of 1.1. It also has a liquidity ratio of 1.99, which can be considered acceptable for its industry.
Firm assets have also increased in value to $124.0 million as at March 2018 from $45.8 million in December 2017, an increase of 271% which is primarily due to the acquisitions of Citiva and GrowHealthy
By all indications, ITHUF will keep appreciating in value for a while yet.
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Disclosure: We have no position in ITHUF and have not been compensated for this article.