Maricann Announces Fiscal Year 2017 Financial Results
TORONTO, April 27, 2018 (GLOBE NEWSWIRE) — Maricann Group (“Maricann” or “the Company”) (CSX:MARI) (FRANKFURT:75M) (OTCMKTS:MRRCF) has reported its financial and operational results for the fiscal year ending December 31, 2017.
We took a number of strategic steps forward in 2017, building a strong foundation for Maricann. The Company is in the midst of an exciting period of expansion. This includes our expansion project, acquisitions and collaborative relationships that we believe will position the Company to have the infrastructure and distribution we need for the future.
Highlights for the year include:
- Strengthened the Company’s balance sheet by raising $41 million through two private placements, one of them being a convertible debenture financing.
- Expanded retail networks through collaborative relationships with pharmacy retail chains
- A three-phase expansion of production and facilities at Langton, Ontario to approximately 942,000 sq. ft. (87,515 sq. m.) is ongoing, with Phase 1 on track for full completion by Q4 2018.
- Increased access to the German market through acquisition of a 95% controlling interest in Maricann GmbH.
- Acquired biotechnology company Nanoleaf Technologies Inc. which has licensed patented technology for ingestible delivery of cannabinoids.
- Further enhanced the Company’s management team with the addition of experienced executives, such as Scott Langille as Chief Financial Officer.
- Subsequent to December 31, 2017, the Company has entered into a definitive agreement with respect to the acquisition of all outstanding shares of Haxxon AG (“Haxxon”). Haxxon operates within a 6,000 sq. m. (approximately 64,500 sq. ft.) indoor facility in Regensdorf, Switzerland; an industrial suburb of Zurich.
- On April 20, 2018, Maricann Inc. received its third site license from Health Canada for its 138 8th Concession Road, Langton, Ontario location.
At December 31, 2017, Maricann posted revenue of $3,222,746, down from $4,060,131 a year earlier. Net loss for the year was $67,012,874, compared with a loss of $8,295,768 in fiscal 2016. Net loss per share was $0.97 compared with $0.22 in 2016. The decrease in revenue, year over year, was primarily due to a shortage of finished products available for sale. In Q1 2017, a severe windstorm blew sand and matter into two of Maricann’s five main flowering greenhouses. To ensure the highest standard of quality and comply with federal Access to Cannabis for Medical Purposes Regulations, management destroyed all plants in the two affected greenhouses and significantly reduced inventory levels. Although the affected crops are insured, until the settlement is resolved Maricann has fully written down the amount.
The increase in net loss can mainly be attributed to accounting practices. Our private placement of convertible debentures and the associated warrants are accounted for as a non-cash fair value loss totaling $37,176,990. Other items that were included in the net loss number are the go-public listing expenses of $4,486,850, share based compensation increase of $3,505,051, sales and marketing increase of $2,492,477 and general and administrative expenses of $10,969,835.
Operating expenses for 2017 increased to $24,463,841, up from $6,417,052 a year earlier.
These expenses reflect continued investment in the expansion of the Company’s facilities and operations as well as the negative impact of two unforeseeable acts of nature.
In Q4 2017, Maricann incurred a construction delay and increased costs related to ground water at the site of its Phase I expansion. The incremental costs were $765,000, an overage of 2.47%.
“We have taken a number of steps at our production facilities to further upgrade our existing facilities and ensure they are able to withstand such extreme weather,” said Ben Ward. “In that and every other facet of our operations Maricann is well-positioned to reap the return on its investment in world class facilities and strategic acquisitions.”
For additional information with respect to the Company’s 2017 year end results, see our audited financial statements and corresponding management’s discussion & analysis under the Company’s profile at www.sedar.com.
About Maricann Group Inc.
Maricann is a vertically integrated producer and distributor of marijuana for medical purposes. The company was founded in 2013 and is based in Burlington, Ontario, Canada and Munich, Germany, with production facilities in Langton, Ontario, Canada where it operates a medicinal cannabis cultivation, extraction, formulation and distribution business under federal licence from the Government of Canada, and Dresden, Saxony, Germany. Maricann is currently undertaking an expansion of its cultivation and support facilities in Canada in a 942,000 sq. ft. (87,515 sq. m) build out to support existing and future patient growth.