IM Cannabis reports C$1.65M revenue after European operations sale
The company held C$2.356 million in cash at Sept. 30 and is negotiating a non-binding proposal to acquire a controlling stake in a Polish drone business.
Adrian Kessler
Quarterly revenue dropped to C$1.65 million from C$5.08 million as IM Cannabis Corp. NASDAQIMCC reported results on Friday after selling its European-focused operations. Total net loss widened to C$7.08 million from C$3.87 million a year earlier.
The Sept. 29 sale included a C$3 million advance payment and the assumption of certain liabilities of up to C$9.4 million. A separate proposal to acquire a 51 per cent stake in a Polish drone business remained non-binding in the Nov. 13 disclosure.
IM Cannabis operates a medical cannabis import, distribution and pharmacy business serving patients in Israel.
Cash stood at C$2.356 million at Sept. 30, with a further C$63,000 restricted, according to its unaudited financial statements. Current liabilities exceeded current assets by approximately C$5.50 million, leaving a working-capital deficit after the European disposal. Current loans and credit were C$6.094 million, alongside C$1.597 million in current convertible promissory notes.
Shares closed at US$0.57 on Nasdaq at 4:00 p.m. EST on Nov. 13 NASDAQIMCC.
The third-quarter 2026 accounts showed a gross loss of C$35,000 as revenue fell below the cost of sales. Finance expenses reached C$2.369 million, compared with C$225,000 in the corresponding quarter, adding to losses beyond the operating business.
The European transaction transferred operations including German subsidiary Adjupharm GmbH to Slil.com Holding Ltd., while IM Cannabis retained its Israeli medical cannabis operations. The Nov. 13 release described the expected balance-sheet effect separately from the advance payment:
"The Company expects the transaction to improve shareholders' equity by approximately C$3 million," the company said in the Nov. 13 release.
The proposed acquisition concerns Space Defense Innovations LLC, a privately held Polish company operating in unmanned aerial systems. IM Cannabis said it was negotiating a definitive share purchase agreement; the Nov. 13 release supplied neither acquisition consideration nor a completion date.
MediPharm Reports Growth In Germany
The disposal reduces IM Cannabis's European exposure as MediPharm Labs Corp. TSELABS OTCMKTSMEDIF FRAMLZ reported on Nov. 12 that German revenue rose 81 per cent year over year.
MediPharm's international medical revenue reached C$6.9 million in the quarter ended Sept. 30, representing 59 per cent of total revenue. Overall revenue was C$11.8 million, with international medical growth driving the sequential increase.
Read more: MediPharm Labs posts second straight quarterly profit as revenue rises 18 per cent
Convertible Financing Adds Warrants
IM Cannabis announced US$1.2 million in gross proceeds from a convertible-note placement on Nov. 4 with an existing institutional investor. The release described a 15 per cent original issuance discount and annual interest of four per cent, with net proceeds intended for general corporate purposes.
The Nov. 4 note matures after 28 months and is repayable in 10 equal monthly instalments beginning after the eighteenth month. Accompanying warrants cover up to 3,936,330 common shares at US$0.610 apiece, creating additional potential share issuance alongside note conversions.
Nasdaq is the company's remaining listing after its voluntary Canadian Securities Exchange delisting took effect on June 2, 2025, according to the Nov. 13 management discussion. The earnings release identifies listing compliance, liquidity and the ability to raise additional capital among its risks.
Read more: Organigram gets Nasdaq bid-price notice with May 2027 deadline
Jan. 1, 2027 is the date the November agreement allows IM Cannabis to begin requesting additional financing. The company may request convertible-note purchases of up to US$1.2 million in each three-month period, with accompanying warrants.
