Unrivaled Brands Reports First Quarter 2022 Financial Results

SANTA ANA, Calif., May 16, 2022 (GLOBE NEWSWIRE) -- Unrivaled Brands, Inc. (OTCQX: UNRV) ("Unrivaled" or the "Company"), a multi-state vertically integrated company focused on the cannabis sector with operations in California and Oregon, today reported its first quarter 2022 financial results for the quarter ended March 31, 2022.

Tiffany Davis, Chief Executive Officer of Unrivaled Brands, stated, “In my recent shareholder letter, I emphasized the importance of a Company’s management and board being able to act swiftly and responsibly to both preserve value and effectively position the organization to capture future growth. 

“I further indicated our immediate focus was to protect our performing assets and to firmly plant us on the path to profitability, beginning with the development and execution of a 100-day transformation plan. 

“I am pleased to report that after an exhaustive review of each of the company’s business units, we have made significant strides in tightening operations and improving financial systems and controls. We have addressed and continue to identify meaningful opportunities to reset the cost structure.   

“We also are taking the necessary steps to restructure our debt, starting with People’s First Choice which will begin to help us preserve operating cashflow. In addition, we are actively pursuing sources of non-dilutive capital. 

“Finally, we realize any transformation takes time and we have a lot of work ahead of us. We expect to announce new members of the management team who have successfully led relevant transformation and turnarounds prior to joining Unrivaled.

 “I continue to be encouraged by our team members who remain hard at work and focused on our day-to-day business. 

“Together, we are making progress and I look forward to sharing more details on our refined strategy and the resulting specific accomplishments, in the coming weeks and months.”

Financial Update

  • During the three months ended March 31, 2022, the Company generated total revenue of $20.73 million composed of retail revenue of $12.11 million and cultivation/distribution revenue of $8.62 million. This compared to total revenue of $2.06 for the quarter ended March 31, 2021 which included retail revenue of 1.70 million and cultivation/distribution revenue of $0.36 million. This was an increase of 907.5% in total revenue.

  • The Company’s gross profit for the three months ended March 31, 2022 was $6.43 million, compared to a gross profit of $0.19 million for the three months ended March 31, 2021, an increase of $6.24 million or 3,268.1%.

  • The merger with UMBRLA and the acquisitions of People's First Choice and SilverStreak Solutions in 2021 led to more operations with additional facilities, employees and costs to support them. Selling, general and administrative expenses for the three months ended March 31, 2022 were $18.77 million, compared to $12.65 million for the three months ended March 31, 2021, an increase of $6.12 million or 48.4%. For the three months ended March 31, 2022, amortization and depreciation expenses increased by $2.76 million over the three months ended March 31, 2021, facilities related expenses, such as rent, utilities, repairs and maintenance, security and insurance, increased by $2.38 million over first quarter of 2021. Option expense and director’s compensation increased by $1.81 million with the addition of two more board members or 196 percent. Taxes, licensing and permitting increased by $1.27 million. Advertising increased by $0.90 million. Employee related expenses decreased by $4.86 million or 69.4%.

About Unrivaled Brands

Unrivaled Brands is a multi-state vertically integrated company focused on the cannabis sector with operations in California and Oregon. In California, Unrivaled Brands operates five dispensaries, direct to consumer delivery, a state-wide distribution network, company-owned brands, and two cultivation facilities. In Oregon, we operate a state-wide distribution network, company-owned brands and outdoor and greenhouse cultivation. Unrivaled Brands is home to Korova, the market leader in high potency products across multiple product categories, currently available in California, Oregon, Arizona, and Oklahoma, as well as Sticks and Cabana. 

For more info, please visit: https://unrivaledbrands.com.

Cautionary Language Concerning Forward-Looking Statements

Certain statements contained in this communication regarding matters that are not historical facts, are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, known as the PSLRA. These include statements regarding management's intentions, plans, beliefs, expectations, or forecasts for the future, and, therefore, you are cautioned not to place undue reliance on them. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by law. We use words such as "anticipates," "believes," "plans," "expects," "projects," "future," "intends," "may," "will," "should," "could," "estimates," "predicts," "potential," "continue," "guidance," and similar expressions to identify these forward-looking statements that are intended to be covered by the safe-harbor provisions of the PSLRA. Such forward-looking statements are based on our expectations and involve risks and uncertainties; consequently, actual results may differ materially from those expressed or implied in the statements due to a number of factors.

New factors emerge from time-to-time and it is not possible for us to predict all such factors, nor can we assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. These risks, as well as other risks associated with the combination, will be more fully discussed in our reports with the SEC. Additional risks and uncertainties are identified and discussed in the "Risk Factors" section of the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents filed from time to time with the SEC. Forward-looking statements included in this release are based on information available to Company as of the date of this release. The Company undertakes no obligation to update such forward-looking statements to reflect events or circumstances after the date of this release.

Contact
Jason Assad
LR Advisors LLC.
jassad@unrivaledbrands.com
678-570-6791

UNRIVALED BRANDS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except shares)
  March 31,
2022
December 31,
2021
  (Unaudited)  
ASSETS    
Current assets:    
Cash $ 3,666   $ 6,891  
Accounts receivable, net   4,026     4,677  
Inventory, net   7,724     7,179  
Prepaid expenses and other assets   2,195     1,272  
Notes receivable   375     750  
Current assets of discontinued operations   5,643     4,495  
Total current assets   23,629     25,264  
     
Property, equipment and leasehold improvements, net   23,457     23,728  
Intangible assets, net   127,294     129,637  
Goodwill   48,132     48,132  
Other assets   22,235     26,915  
Investments   239     163  
Assets of discontinued operations   4,817     17,984  
TOTAL ASSETS $ 249,802   $ 271,824  
     
LIABILITIES AND STOCKHOLDERS’ EQUITY    
LIABILITIES:    
Current liabilities:    
Accounts payable and accrued expenses $ 36,483   $ 31,904  
Short-term debt   29,566     45,749  
Income taxes payable   8,124     7,969  
Current liabilities of discontinued operations   2,210     2,087  
Total current liabilities   76,383     87,708  
     
Long-term liabilities:    
Long-term debt, net of discounts   7,308     10,006  
Deferred tax liabilities   4,435     6,123  
Long-term lease liabilities   17,000     21,316  
Long-term liabilities of discontinued operations   150     184  
Total long-term liabilities   28,893     37,629  
Total liabilities   105,276     125,337  
     
STOCKHOLDERS’ EQUITY:    
Common stock, par value $0.001:    
990,000,000 shares authorized as of March 31, 2022 and December 31, 2021; 530,330,007 shares issued and 528,021,587 shares outstanding as of March 31, 2022; 498,546,295 shares issued and 496,237,883 shares outstanding as of December 31, 2021.   552     521  
Additional paid-in capital   399,536     392,930  
Treasury stock   (808)     (808)  
Accumulated deficit   (258,888)     (250,015)  
Total Unrivaled Brands, Inc. Stockholders’ Equity   140,392     142,628  
Non-controlling interest   4,134     3,859  
Total stockholders’ equity   144,526     146,487  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 249,802   $ 271,824  
     

UNRIVALED BRANDS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except shares and per share data)
  Three Months Ended
March 31,
  2022 2021
     
Total revenues $ 20,725   $ 2,057  
Cost of goods sold   14,292     1,866  
Gross profit   6,433     191  
     
Selling, general and administrative expenses   18,767     12,650  
Gain on sale of assets   (198)     -  
Loss from operations   (12,136)     (12,459)  
     
Other income (expense):    
Gain (loss) on extinguishment of debt   542     (6,161)  
Interest expense, net   (1,766)     (71)  
Other income   1,034     345  
Gain on investments   -     6,212  
Total other income (expense)   (190)     325  
     
Loss from continuing operations, before provision for income taxes   (12,326)     (12,134)  
Provision for income taxes for continuing operations   1,688     -  
Net income (loss) from continuing operations   (10,638)     (12,134)  
     
Income from discontinued operations, before provision for income taxes   2,135     438  
Provision for income taxes for discontinued operations   (95)     -  
Net income (loss) from discontinued operations   2,040     438  
     
NET LOSS   (8,598)     (11,696)  
     
Less: Income (loss) attributable to non-controlling interest from continuing operations   -     -  
Less: Income (loss) attributable to non-controlling interest from discontinued operations   275     381  
NET LOSS ATTRIBUTABLE TO UNRIVALED BRANDS, INC. $ (8,873)   $ (12,077)  
     
Loss from continuing operations per common share attributable to Unrivaled Brands, Inc. common stockholders – basic and diluted $ (0.02)   $ (0.05)  
Net Loss per common share attributable to Unrivaled Brands, Inc. common stockholders – basic and diluted $ (0.02)   $ (0.05)  
     
Weighted-average number of common shares outstanding – basic and diluted   561,818,857     237,752,273  
     


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Source: Unrivaled Brands, Inc.