Year-over-year MedMen Enterprises Inc. (CSE: MMEN and OTCQX: MMNFF) reported its second quarter revenue was up 50 per cent in Wednesday’s earnings report.
Excluding its stores in Arizona currently being sold, the company reported revenue of US$44.1 million for the period ended Dec. 28, 2019.
Investors didn’t seem impressed by the company’s boost in revenue as the company stock slumped $0.10 from Wednesday’s high of $0.43.
In November, MedMen announced aggressive measures to cut back company spending, including axing 190 employees (or 20 per cent of its workforce) to raise its bottom line.
But on Wednesday the efforts appeared to be paying off as MedMen announced it had reduced its general and administrative expenses by 30 per cent from the company’s second quarter for 2019 — representing US$46 million in savings.
The company’s adjusted earnings before interest, tax, depreciation and amortization was reported at a loss of US$35.1 million, which does not take into account how the company cut 20 per cent of its workforce, the report notes. Around one third of that loss, or $US$11.4 million, is from the company’s cultivation and manufacturing facilities.
In the company’s analysis of its results of operations for the quarter, MedMen said its cash or cash equivalents was down US$7.8 million to US$26 million from last quarter. Its working capital deficit, on the other hand, ballooned to US$37.7 million compared to US$9.8 million last quarter.
As cannabis is still a Schedule 1 drug at the federal level in the U.S., MedMen also noted how all of its assets (US$844,012,021) and operations (US$83,735,878) are from weed-related activities.
In a corporate shuffle, CEO and co-founder Adam Bierman got the boot Feb. 1, 2020, and chief technology officer Ryan Lissack was appointed interim CEO.
The company also announced it appointed Mal Elias and Cameron Smith to its board of directors as independent members.
Top image: press photo