What a year it has been for MedMen Enterprises (CSE: MMEN, OTCQX:MMNFF, Forum).
The preeminent U.S. cannabis Company made headlines and was covered on national television from the
Today Show to
Jimmy Kimmel Live as everyone wanted to learn more about the ‘Apple Store of Weed’ and see what comes next ….
2018 was a year where MedMen established its concept and proved its track record. It captured a 5.3% market share in California, arguably the most mature cannabis market in the U.S. Now the Company plans to leverage its experience to advance the development of new locations and its seed-to-sale operations.
The Company
went public in Mayon the Canadian Securities Exchange, raising more than $300 million, following its successful completion of a reverse takeover of a Canadian public company by U.S.-based MM Enterprises USA, LLC. Its shares even graduated to the
OTCQX marketand listed on the Frankfurt Stock Exchange in August (A2JM6N).
Having just released its first Quarter year 2019 financial results, MMEN reported revenues of $21.5 million representing 1,094% revenue growth over first quarter fiscal 2018 and 4.4% from fourth quarter 2018. The Company performed favourably with $6,188 annualized sales per square foot with an 82% conversion rate across eight stores in Southern California.
Company co-founder and CEO Adam Bierman tied this growth to its business strategy of bringing a variety of products to the mainstream cannabis audience for lifestyle and wellness needs.
“Our four-pillars strategy – built around a quality team, superior assets, strong balance sheet and the ability to efficiently and effectively raise and deploy capital – has set us up to successfully achieve our vision. We are now entering a new phase focused on fully operationalizing our vast footprint.”
2019 is shaping up to be an even bigger year for MedMen, having secured several acquisitions over that past year to boost its bottom line. The focus moving ahead now will be to build-out these stores and operations.
From a Florida marijuana license and cultivation facilityto its investments into the Lowell Herb Co.and the cannabis flower brand Old Pal. One of the most significant acquisitions MedMen made in 2018 was for Level Up, which holds licenses for two vertically-integrated operations in Arizona, including retail locations in Scottsdale and Tempe as well as 25,000 square feet of cultivation and production capacity in Tempe and Phoenix. The Company will also receive a 40% stake in top-selling brand K.I.N.D. Concentrates, which is currently distributed in over 90% of the dispensaries in that state.
MedMen deepened its footprint across the United States in 2018. Upon closing of all pending transactions, the Company will be licensed for 76 retail stores and 16 cultivation and production factories across 12 key states, reaching about half of the U.S. addressable market of $75 billion. This includes another important acquisition made by MMEN in October - PharmaCann, which doubled the number of states that it has licenses.
The Company made deep inroads in its retail footprint. It opened two stores in Las Vegas, a store on New York’s Fifth Avenue, another in America’s ‘coolest block’ on Venice, CA’s Abbot Kinney Blvd, and acquired additional licenses in Northern California, Arizona and Illinois. It also opened its first factory in Nevada and broke ground on its factory in California. MedMen’s California stores are outperforming the sector as a whole. According to the California Bureau of Cannabis Control’s tax figures, MedMen’s stores out-performednon-MedMen stores by a factor of three in average sales.
Tax revenue growth in California, according to the California Department of Tax and Fee Administration, totaled $74.2 million for Q2 2018, including $43.5 million in excise taxes that were charged on all cannabis and cannabis products sold by licensed retailers. Based on the 15% excise tax rate for marijuana, that equates to total sales of approximately $290 million from April 1st to June 30th of this year. MedMen recently reported preliminary unaudited systemwide retail revenue of $17.4 million during the same period for seven of its stores in California. The Company set its sights beyond the west coast and entered the Illinois market through the pending acquisition of a licensed medical dispensary in Oak Park.
As 2019 approaches, the Company intends to build upon its operations, accelerate its new operations, locations and seed-to-sale businesses.
https://medmen.com/
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.