California Weed Co. Settles Debt And Celebrates Turn-Around In Q3

Author: Jelena Martinovic | November 15, 2023 12:01pm

Unrivaled Brands, Inc. (OTCQB:UNRV) reported its third quarter financial results Tuesday for the three months ended Sept. 30, 2023, revealing an 11.4% year-over-year drop in revenue to $8.6 million.

The Santa Ana, California-based company said that 94% of revenue was driven by its four retail stores and sales of our in-house cultivated flower and Korova-branded products. The retail gross margin was 52% for the quarter.

“Despite the formidable challenges in the regulated cannabis market, we've proven resilient,” Patty Chan, Unrivaled’s CFO said. “We will remain committed to prioritizing customer retention and delivering an exceptional retail experience with high-quality, curated products. We will continue to navigate the evolving cannabis landscape, particularly in California, as we look to a fully federally legal market and ripe opportunities.”

Q3 2023 Financial Results

• Gross profit amounted to roughly $4 million, up from $42,000 gross loss in the same quarter of last year.
• Gross profit margin was 46% compared to 52% in the prior quarter.
• Net loss was $3.4 million, compared to $119.9 net loss in the prior year’s period.
• Adjusted EBITDA came in negative at $1.2 million, compared to $9.2 million adjusted EBITDA loss in the prior year’s period.
• Selling, general and administrative expenses decreased by 7% compared to the previous quarter ended June 30, 2023.
• The company had a $1.3 million gain on investments and a $1.5 million loss on disposal of assets.
• The company had $0.9 million of interest expense and $0.9 million of non-cash expense for income taxes, depreciation, and amortization.

Settlement Of Litigation And Debt

Meanwhile, Unrivaled announced on Wednesday that it has entered into a binding settlement term sheet to settle a $4.12 million of debt inclusive of interest and penalties, with third-party accredited and institutional investors, and a related motion for summary judgment brought by certain of the investors.

In January 2021, Unrivaled agreed to sell $3.5 million in aggregate principal amount of its senior convertible promissory notes to several accredited investors including institutional investors.

The company expects to record a gain on the settlement of this debt of roughly $2.37 million in its 2023 financial statements.

“It is with gratitude and optimism that the Company settles another significant matter and substantial debt amount,” Unrivaled’s CEO Sabas Carrillo said. “We continue to be thankful to our creditors and all that have supported the turn-around of this Company.”

UNRV Price Action

Unrivaled’s shares traded 4.09% lower at $0.0105 per share at the time of writing on Wednesday.

•  47.10% with $GTBIF
•  40.23% with $TCNNF
•  21.50% with $VFF

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• Toni Ko-Controlled Cannabis Landlord Files Lien Against California-Based Weed Company
• Unrivaled Brands Revenue Declines 44% YoY In Q2, Profit Follows Suit

Photo: Courtesy of NikolayFrolochkin and ganjaspliffstoreuk by Pixabay

Posted In: UNRV