Jushi Holdings Inc 8-K, filed Sep 12, 2022
Jushi Holdings Inc. (JUSH)
About this 8-K
Jushi Holdings Inc filed this 8-K on September 12, 2022, reporting on events of September 9, 2022.
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM
_________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
_______________________________
(Exact name of registrant as specified in its charter)
_______________________________
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) (Zip Code)
(
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
_______________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| None | N/A | N/A |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
As previously reported by Jushi Holdings Inc. (the “Company”) on its Current Report on Form 8-K filed with the Securities and Exchange Commission on August 29, 2022, the Company reported errors in its previously issued unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2022 which resulted in the understatement of certain non-current assets and associated accruals in the Company’s previously issued unaudited condensed balance sheet as of March 31, 2022, and the understatement of net cash flows used in operating activities, the overstatement of net cash flows used in investing activities, and the understatement of net cash flows provided by financing activities in its unaudited condensed consolidated statement of cash flows for the three months ended March 31, 2022.
The Company filed restated condensed consolidated financial statements for the three months ended March 31, 2022 with the applicable Canadian securities regulatory authorities on September 9, 2022 in accordance with applicable Canadian securities laws, which may be accessed at www.sedar.com. These restated unaudited condensed consolidated financial statements are attached hereto as Exhibit 99.1 and are incorporated herein by reference.
On September 9, 2022, the Company issued a press release announcing the filing of the restated first quarter 2022 unaudited condensed consolidated financial statements with the Canadian securities regulator, a copy which is furnished with this Form 8-K and attached hereto as Exhibit 99.2.
The information contained in this Item 2.02, including Exhibits 99.1 and 99.2, is furnished only, is not "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended, regardless of any general incorporation language in such a filing, except as expressly set forth by specific reference in that filing.
(d) Exhibits.
| Exhibit No. | Title | |||
| 99.1 | Restated condensed consolidated financial statements as of and for the three months ended March 31, 2022 | |||
| 99.2 | Management’s Discussion and Analysis as of and for the three months ended March 31, 2022 | |||
| 99.3 | Press Release of Jushi Holdings Inc. dated September 9, 2022 | |||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| JUSHI HOLDINGS INC. | ||
| Date: September 9, 2022 | By: | /s/ Jon Barack |
| Jon Barack | ||
| President and Interim Chief Financial Officer | ||
|
INTERIM CONDENSED
CONSOLIDATED BALANCE SHEETS |
1 | ||||
|
UNAUDITED INTERIM
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) |
2 | ||||
|
UNAUDITED INTERIM
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY |
3 | ||||
|
UNAUDITED INTERIM
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
4 | ||||
|
NOTES TO THE
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
6 | ||||
| March 31, 2022 (unaudited) | December 31, 2021 | ||||||||||||||||
| ASSETS | |||||||||||||||||
| CURRENT ASSETS: | |||||||||||||||||
| Cash and cash equivalents | $ | 75,717 | $ | 94,962 | |||||||||||||
| Accounts receivable, net | 1,460 | 3,200 | |||||||||||||||
| Inventories | 39,282 | 43,319 | |||||||||||||||
| Prepaid expenses and other current assets | 6,174 | 12,875 | |||||||||||||||
| Total current assets | $ | 122,633 | $ | 154,356 | |||||||||||||
| NON-CURRENT ASSETS: | |||||||||||||||||
| Property, plant and equipment, net | $ | 152,943 | $ | 137,280 | |||||||||||||
|
Right-of
use assets - finance leases (2022,
as restated, see Note 23) |
100,087 | 94,008 | |||||||||||||||
| Other intangible assets, net | 189,931 | 182,466 | |||||||||||||||
| Goodwill | 61,392 | 52,920 | |||||||||||||||
| Other non-current assets | 29,133 | 27,586 | |||||||||||||||
| Non-current restricted cash | 525 | 525 | |||||||||||||||
| Total non-current assets | $ | 534,011 | $ | 494,785 | |||||||||||||
|
Total assets
(2022,
as restated, see Note 23) |
$ | 656,644 | $ | 649,141 | |||||||||||||
| LIABILITIES AND EQUITY | |||||||||||||||||
| CURRENT LIABILITIES: | |||||||||||||||||
| Accounts payable | $ | 21,611 | $ | 10,539 | |||||||||||||
|
Accrued
expenses and other current liabilities (2022,
as restated, see Note 23) |
38,773 | 47,972 | |||||||||||||||
| Income tax liabilities - current | 9,170 | 6,614 | |||||||||||||||
|
Debt,
net - current portion (including related party principal amounts of $3,669 as of March 31, 2022) |
65,588 | 6,181 | |||||||||||||||
| Finance lease obligations - current | 13,197 | 12,620 | |||||||||||||||
|
Total
current liabilities (2022,
as restated, see Note 23) |
$ | 148,339 | $ | 83,926 | |||||||||||||
| NON-CURRENT LIABILITIES: | |||||||||||||||||
|
Non-current
debt, net (including related party principal amounts of $4,578 as of December 31, 2021) |
$ | 77,384 | $ | 122,971 | |||||||||||||
| Finance lease obligations - non-current | 88,539 | 88,297 | |||||||||||||||
| Operating lease liabilities - non-current | 14,933 | 15,163 | |||||||||||||||
| Derivative liabilities | 68,975 | 92,435 | |||||||||||||||
| Income tax liabilities - non-current | 58,372 | 57,143 | |||||||||||||||
| Contingent consideration liabilities - non-current | 6,945 | 8,223 | |||||||||||||||
| Total non-current liabilities | $ | 315,148 | $ | 384,232 | |||||||||||||
|
Total liabilities
(2022,
as restated, see Note 23) |
$ | 463,487 | $ | 468,158 | |||||||||||||
|
COMMITMENTS
AND CONTINGENCIES (Note 20) |
|||||||||||||||||
| EQUITY: | |||||||||||||||||
|
Common
stock (no par value; authorized shares - unlimited; issued shares - 189,728,625 and 182,707,359 Subordinate Voting Shares (including
2,757,290 and 2,859,151 unvested stock awards) as of March 31, 2022 and December 31, 2021, respectively |
$ | — | $ | — | |||||||||||||
| Paid-in capital | 456,719 | 424,788 | |||||||||||||||
| Accumulated deficit | (262,175) | (242,418) | |||||||||||||||
| Total Jushi shareholders' equity | $ | 194,544 | $ | 182,370 | |||||||||||||
| Non-controlling interests | (1,387) | (1,387) | |||||||||||||||
| Total equity | $ | 193,157 | $ | 180,983 | |||||||||||||
|
Total liabilities
and equity (2022,
as restated, see Note 23) |
$ | 656,644 | $ | 649,141 | |||||||||||||
| Three
Months Ended March 31, |
|||||||||||||||||
| 2022 | 2021 | ||||||||||||||||
| REVENUE, NET | $ | 61,888 | $ | 41,675 | |||||||||||||
| COST OF GOODS SOLD | (42,776) | (22,934) | |||||||||||||||
| GROSS PROFIT | $ | 19,112 | $ | 18,741 | |||||||||||||
| OPERATING EXPENSES | $ | 37,308 | $ | 21,911 | |||||||||||||
| LOSS FROM OPERATIONS | $ | (18,196) | $ | (3,170) | |||||||||||||
| OTHER (EXPENSE) INCOME: | |||||||||||||||||
| Interest expense, net | $ | (10,116) | $ | (6,835) | |||||||||||||
| Fair value gains (losses) on derivatives | 14,309 | (9,358) | |||||||||||||||
| Other, net | (703) | (3,376) | |||||||||||||||
| Total net other income (expense) | $ | 3,490 | $ | (19,569) | |||||||||||||
| INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES | $ | (14,706) | $ | (22,739) | |||||||||||||
| Provision for income taxes | (5,051) | (8,312) | |||||||||||||||
| NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) | $ | (19,757) | $ | (31,051) | |||||||||||||
| Net loss attributable to non-controlling interests | — | (175) | |||||||||||||||
| NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO JUSHI SHAREHOLDERS | $ | (19,757) | $ | (30,876) | |||||||||||||
| NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) PER SHARE ATTRIBUTABLE TO JUSHI SHAREHOLDERS - BASIC | $ | (0.11) | $ | (0.20) | |||||||||||||
| Weighted average shares outstanding - basic | 183,226,027 | 157,176,375 | |||||||||||||||
| NET (LOSS) AND COMPREHENSIVE (LOSS) PER SHARE ATTRIBUTABLE TO JUSHI SHAREHOLDERS - DILUTED | $ | (0.16) | $ | (0.20) | |||||||||||||
| Weighted average shares outstanding - diluted | 207,838,906 | 157,176,375 | |||||||||||||||
| Number of Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Super Voting Shares | Multiple Voting Shares | Subordinate Voting Shares | Paid-In Capital | Accumulated Deficit | Total Jushi Shareholders' Equity | Non-Controlling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances - January 1, 2022 | — | — | 182,707,359 | $ | 424,788 | $ | (242,418) | $ | 182,370 | $ | (1,387) | $ | 180,983 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Private placement offerings | — | — | 3,717,392 | 13,680 | — | 13,680 | — | 13,680 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued for Apothecarium acquisition | — | — | 527,704 | 1,594 | — | 1,594 | — | 1,594 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Restricted stock grants and vesting, net of forfeitures (including related parties) | — | — | 5,952 | 832 | — | 832 | — | 832 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Warrant expense, net of cancellations (including related parties) | — | — | — | 287 | — | 287 | — | 287 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock option expense, net of forfeitures (including related parties) | — | — | — | 5,845 | — | 5,845 | — | 5,845 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued upon exercise of warrants | — | — | 2,676,303 | 9,693 | — | 9,693 | — | 9,693 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued upon exercise of stock options | — | — | 93,915 | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (19,757) | (19,757) | — | (19,757) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances - March 31, 2022 | — | — | 189,728,625 | $ | 456,719 | $ | (262,175) | $ | 194,544 | $ | (1,387) | $ | 193,157 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Number of Shares | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Super Voting Shares | Multiple Voting Shares | Subordinate Voting Shares | Paid-In Capital | Accumulated Deficit | Total Jushi Shareholders' Equity | Non-Controlling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances - January 1, 2021 | 149,000 | 4,000,000 | 132,396,064 | $ | 262,145 | $ | (262,669) | $ | (524) | $ | 2,947 | $ | 2,423 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Public offerings | — | — | 13,685,000 | 85,660 | — | 85,660 | — | 85,660 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Purchase of non-controlling interests | — | — | 500,000 | 1,562 | — | 1,562 | (1,562) | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition of Grover Beach | — | — | 49,348 | 368 | — | 368 | — | 368 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Restricted stock grants and vesting, net of forfeitures | — | — | — | 2,538 | — | 2,538 | — | 2,538 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Warrant expense, net of cancellations | — | — | — | 547 | — | 547 | — | 547 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock option expense, net of forfeitures | — | — | — | 928 | — | 928 | — | 928 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued upon exercise of warrants | — | — | 3,898,180 | 13,135 | — | 13,135 | — | 13,135 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued upon exercise of stock options | — | — | 15,000 | 30 | — | 30 | — | 30 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (30,876) | (30,876) | (175) | (31,051) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balances - March 31, 2021 | 149,000 | 4,000,000 | 150,543,592 | $ | 366,913 | $ | (293,545) | $ | 73,368 | $ | 1,210 | $ | 74,578 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three
Months Ended March 31, |
||||||||||||||
| 2022 | 2021 | |||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||
| Net income (loss) | $ | (19,757) | $ | (31,051) | ||||||||||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||||||||
| Depreciation and amortization, including amounts in cost of goods sold | 3,248 | 1,579 | ||||||||||||
| Share-based compensation | 6,964 | 4,013 | ||||||||||||
| Fair value changes in derivatives | (14,309) | 9,358 | ||||||||||||
| Non-cash interest expense | 4,551 | 3,905 | ||||||||||||
| Deferred income taxes | (1,125) | (280) | ||||||||||||
| Loss on debt modification/extinguishment/redemption | — | 3,815 | ||||||||||||
| (Gains) losses on investments and financial assets | — | (1,149) | ||||||||||||
| Non-cash other (income) expense, net | 438 | (110) | ||||||||||||
| Changes in operating assets and liabilities, net of acquisitions: | ||||||||||||||
| Accounts receivable | 1,770 | (16) | ||||||||||||
|
Prepaid
expenses and other current assets (2022,
as restated, see Note 23) |
(316) | 512 | ||||||||||||
| Inventory | 5,917 | (5,680) | ||||||||||||
|
Accounts
payable, accrued expenses and other current liabilities (2022,
as restated, see Note 23) |
(2,379) | 12,095 | ||||||||||||
| Other assets | 1,173 | (112) | ||||||||||||
|
Net
cash flows used in operating activities (2022,
as restated, see Note 23) |
$ | (13,825) | $ | (3,121) | ||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||
| Payments for acquisitions, net of cash acquired | $ | (6,592) | $ | (3,592) | ||||||||||
|
Payments
for property, plant and equipment (2022,
as restated, see Note 23) |
(17,039) | (8,566) | ||||||||||||
| Proceeds from investments and financial asset | — | 3,252 | ||||||||||||
|
Net
cash flows used in investing activities (2022,
as restated, see Note 23) |
$ | (23,631) | $ | (8,906) | ||||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||
| Issuance of shares for cash, net | $ | 13,680 | $ | 85,660 | ||||||||||
| Proceeds from exercise of warrants and options | 541 | 9,886 | ||||||||||||
|
Redemptions
of senior notes (including related party redemptions of $8 and $3,072 for
three
months ended March 31, 2022 and 2021, respectively) |
(258) | (8,134) | ||||||||||||
|
Receipts
(payments) on finance leases, net of tenant allowance of $9,597 and $954 for the three months ended March 31, 2022 and 2021, respectively
(2022,
as restated, see Note 23) |
1,121 | (251) | ||||||||||||
| Proceeds from other debt | 3,265 | 1,134 | ||||||||||||
| Repayments of other debt | (130) | — | ||||||||||||
|
Net
cash flows provided by financing activities (2022,
as restated, see Note 23) |
$ | 18,219 | $ | 88,295 | ||||||||||
| Effect of currency translation on cash and cash equivalents | (9) | (40) | ||||||||||||
| NET CHANGE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | $ | (19,246) | $ | 76,228 | ||||||||||
| CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | 95,487 | 85,857 | ||||||||||||
| CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | $ | 76,241 | $ | 162,085 | ||||||||||
| Three
Months Ended March 31, |
||||||||||||||
| 2022 | 2021 | |||||||||||||
| SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid for interest (excluding capitalized interest) | $ | 5,580 | $ | 3,027 | ||||||||||
| Cash paid for income taxes | $ | 3,867 | $ | 686 | ||||||||||
| NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||||||||
|
Capital
expenditures (2022,
as restated, see Note 23) |
$ | 24,939 | $ | 3,531 | ||||||||||
| Right of use assets from finance lease liabilities (excluding from acquisitions) | $ | — | $ | 928 | ||||||||||
| Fair value of note obligations and warrant liabilities from acquisitions and acquisitions of non-controlling interests | $ | 6,922 | $ | — | ||||||||||
| Fair value of shares issued for acquisitions and acquisitions of non-controlling interests | $ | 1,594 | $ | 1,930 | ||||||||||
| Assets acquired and liabilities assumed in acquisitions: | ||||||||||||||
| Cash and cash equivalents | $ | 25 | $ | — | ||||||||||
| Other current assets | $ | 731 | $ | — | ||||||||||
| Property, plant and equipment, including right-of-use assets | $ | 3,051 | $ | 2,319 | ||||||||||
| Other non current assets | $ | 301 | $ | 19 | ||||||||||
| Other intangible assets | $ | 8,200 | $ | 3,654 | ||||||||||
| Goodwill | $ | 8,472 | $ | — | ||||||||||
| Accounts payable and accrued liabilities | $ | (502) | $ | — | ||||||||||
| Lease obligations | $ | (2,544) | $ | (2,032) | ||||||||||
| Deferred tax liabilities | $ | (2,601) | $ | — | ||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
 | ||||
|
1. NATURE
OF OPERATIONS | ||
|
2. BASIS
OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
3. REVENUE
| ||
| Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||
| 2022 | 2021 | ||||||||||||||||||||||||||||||||||
| Gross Revenue | Intercompany Revenue | Revenue to External Customers | Gross Revenue | Intercompany Revenue | Revenue to External Customers | ||||||||||||||||||||||||||||||
| Retail cannabis | $ | 57,955 | $ | — | $ | 57,955 | $ | 39,277 | $ | — | $ | 39,277 | |||||||||||||||||||||||
| Wholesale cannabis | 9,443 | (5,595) | 3,848 | 4,192 | (1,883) | 2,309 | |||||||||||||||||||||||||||||
| Other | 85 | — | 85 | 89 | — | 89 | |||||||||||||||||||||||||||||
| Eliminations | (5,595) | 5,595 | — | (1,883) | 1,883 | — | |||||||||||||||||||||||||||||
| Consolidated revenue | $ | 61,888 | $ | — | $ | 61,888 | $ | 41,675 | $ | — | $ | 41,675 | |||||||||||||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
4. INVENTORIES | ||
| March 31, 2022 (unaudited) | December 31, 2021 | ||||||||||
| Cannabis plants | $ | 3,101 | $ | 6,347 | |||||||
| Harvested cannabis and packaging | $ | 9,180 | $ | 5,180 | |||||||
| Total raw materials | $ | 12,281 | $ | 11,527 | |||||||
| Work in process | 6,136 | 8,756 | |||||||||
| Finished goods | 20,865 | 23,036 | |||||||||
| Total inventories, net | $ | 39,282 | $ | 43,319 | |||||||
|
5. PREPAID
EXPENSES AND OTHER CURRENT ASSETS | ||
| March 31, 2022 (unaudited) | December 31, 2021 | ||||||||||||||||
| Prepaid expenses and deposits | $ | 3,844 | $ | 3,837 | |||||||||||||
| Landlord receivables for tenant allowance | 394 | 7,357 | |||||||||||||||
| Employee receivable | 46 | 248 | |||||||||||||||
| Other current assets | 1,890 | 1,433 | |||||||||||||||
| Total prepaid expenses and other current assets | $ | 6,174 | $ | 12,875 | |||||||||||||
|
6. PROPERTY,
PLANT AND EQUIPMENT | ||
| March 31, 2022 (unaudited) | December 31, 2021 | ||||||||||||||||||||||
| Buildings and building components | $ | 51,020 | $ | 49,697 | |||||||||||||||||||
| Land | 12,380 | 12,380 | |||||||||||||||||||||
| Leasehold improvements | 23,323 | 24,042 | |||||||||||||||||||||
| Machinery and equipment | 12,743 | 12,656 | |||||||||||||||||||||
| Computer equipment | 2,281 | 2,221 | |||||||||||||||||||||
| Furniture and fixtures | 8,518 | 8,000 | |||||||||||||||||||||
| Construction-in-process | 52,521 | 35,625 | |||||||||||||||||||||
| Total property, plant and equipment - gross | $ | 162,786 | $ | 144,621 | |||||||||||||||||||
| Less: Accumulated depreciation | (9,843) | (7,341) | |||||||||||||||||||||
| Total property, plant and equipment - net | $ | 152,943 | $ | 137,280 | |||||||||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
7. ACQUISITIONS | ||
| Cash and cash equivalents | $ | 25 | |||
| Prepaids and other assets | 32 | ||||
| Inventory | 699 | ||||
| Property, plant and equipment | 498 | ||||
| Right-of-use assets | 2,553 | ||||
|
Intangible asset
- licenses (1) |
8,200 | ||||
| Deposits | 301 | ||||
| Total assets | $ | 12,308 | |||
| Accounts payable and accrued liabilities | $ | (502) | |||
| Lease liabilities | (2,544) | ||||
| Deferred tax liabilities | (2,601) | ||||
| Total liabilities | $ | (5,647) | |||
| Net assets acquired | $ | 6,661 | |||
| Goodwill | 8,472 | ||||
| Total | $ | 15,133 | |||
| Consideration paid in cash, as adjusted for working capital adjustments | $ | 6,617 | |||
|
Consideration
paid in promissory notes (fair value) (2) |
6,922 | ||||
|
Consideration
paid in shares (3) |
1,594 | ||||
| Fair value of consideration | $ | 15,133 | |||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Business Combinations | Asset Acquisitions | ||||||||||||||||||||||||||||
| Nature’s Remedy | OSD | OhiGrow | Grover Beach | Total | |||||||||||||||||||||||||
| Assets Acquired: | |||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | 3,195 | $ | 259 | $ | — | $ | — | $ | 3,454 | |||||||||||||||||||
| Prepaids | 325 | 53 | — | — | 378 | ||||||||||||||||||||||||
| Accounts receivable, net | 263 | — | — | — | 263 | ||||||||||||||||||||||||
| Inventory | 15,882 | 184 | — | — | 16,066 | ||||||||||||||||||||||||
|
Indemnification
assets (1) |
1,322 | 1,411 | — | — | 2,733 | ||||||||||||||||||||||||
| Property, plant and equipment | 19,470 | — | 3,165 | 269 | 22,904 | ||||||||||||||||||||||||
| Right-of-use assets - finance leases | 27,305 | — | — | 2,050 | 29,355 | ||||||||||||||||||||||||
| Right-of-use assets - operating leases | 1,337 | 1,859 | — | — | 3,196 | ||||||||||||||||||||||||
|
Intangible
assets - license (2) |
46,000 | 2,160 | 1,817 | 3,654 | 53,631 | ||||||||||||||||||||||||
|
Intangible
assets - tradenames (2) |
4,400 | — | — | — | 4,400 | ||||||||||||||||||||||||
|
Intangible
assets - customer database (2) |
2,100 | — | — | — | 2,100 | ||||||||||||||||||||||||
| Deposits | 20 | 6 | — | 19 | 45 | ||||||||||||||||||||||||
| Total assets acquired | $ | 121,619 | $ | 5,932 | $ | 4,982 | $ | 5,992 | $ | 138,525 | |||||||||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Business Combinations | Asset Acquisitions | ||||||||||||||||||||||||||||
| Nature’s Remedy | OSD | OhiGrow | Grover Beach | Total | |||||||||||||||||||||||||
| Liabilities Assumed: | |||||||||||||||||||||||||||||
| Accounts payable and accrued liabilities | $ | 7,004 | $ | 1,601 | $ | — | $ | — | $ | 8,605 | |||||||||||||||||||
| Finance lease obligations | 27,052 | — | — | 2,032 | $ | 29,084 | |||||||||||||||||||||||
| Operating lease obligations | 1,267 | 1,859 | — | — | $ | 3,126 | |||||||||||||||||||||||
| Deferred tax liabilities | 19,876 | 648 | — | — | $ | 20,524 | |||||||||||||||||||||||
| Total liabilities | $ | 55,199 | $ | 4,108 | $ | — | $ | 2,032 | $ | 61,339 | |||||||||||||||||||
| Net assets acquired | $ | 66,420 | $ | 1,824 | $ | 4,982 | $ | 3,960 | $ | 77,186 | |||||||||||||||||||
| Goodwill | 33,178 | 2,432 | — | — | 35,610 | ||||||||||||||||||||||||
| Total | $ | 99,598 | $ | 4,256 | $ | 4,982 | $ | 3,960 | $ | 112,796 | |||||||||||||||||||
| Consideration: | |||||||||||||||||||||||||||||
| Consideration paid in cash, as adjusted for working capital adjustments | $ | 40,360 | $ | 1,827 | $ | 4,949 | $ | 3,592 | $ | 50,728 | |||||||||||||||||||
| Consideration paid in promissory notes (fair value) | 15,345 | 2,429 | — | — | $ | 17,774 | |||||||||||||||||||||||
| Consideration paid in shares | 35,670 | — | — | 368 | $ | 36,038 | |||||||||||||||||||||||
| Contingent consideration | 8,223 | — | — | — | $ | 8,223 | |||||||||||||||||||||||
| Capitalized costs | — | — | 33 | — | $ | 33 | |||||||||||||||||||||||
| Fair value of consideration | $ | 99,598 | $ | 4,256 | $ | 4,982 | $ | 3,960 | $ | 112,796 | |||||||||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Three months ended March 31, | ||||||||||||||
| 2022 | 2021 | |||||||||||||
| Revenue | $ | 64,903 | $ | 55,962 | ||||||||||
| Net income (loss) | $ | (19,560) | $ | (31,463) | ||||||||||
|
8. ACCRUED
EXPENSES AND OTHER CURRENT LIABILITIES | ||
| March 31, 2022 (unaudited) | December 31, 2021 | ||||||||||||||||
|
Accrued capital
expenditures (2022,
as restated, see Note 23) |
$ | 13,566 | $ | 17,599 | |||||||||||||
| Goods received not invoiced | 6,501 | 8,007 | |||||||||||||||
| Accrued employee related expenses and liabilities | 5,838 | 6,062 | |||||||||||||||
| Accrued professional and management fees | 2,007 | 5,139 | |||||||||||||||
| Accrued sales and excise taxes | 1,189 | 2,535 | |||||||||||||||
| Accrued interest | 1,470 | 1,181 | |||||||||||||||
| Deferred revenue (loyalty program) | 1,693 | 1,427 | |||||||||||||||
| Operating lease obligations - current portion | 2,705 | 2,745 | |||||||||||||||
|
Contingent consideration
liabilities - current portion(1) |
1,683 | — | |||||||||||||||
| Other accrued expenses and current liabilities | 2,121 | 3,277 | |||||||||||||||
|
Total
(2022,
as restated, see Note 23) |
$ | 38,773 | $ | 47,972 | |||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
9. DEBT | ||
| Effective Interest Rate | Maturity Date | March 31, 2022 | December 31, 2021 | ||||||||||||||
| Principal amounts: | |||||||||||||||||
| Senior Notes | 34% | January 2023 | $ | 74,935 | $ | 75,193 | |||||||||||
| Acquisition Facility | 14% | October 2026 | 40,000 | 40,000 | |||||||||||||
| Acquisition-related promissory notes payable | 9% - 25% | November 2022 - April,2027 | 35,614 | 25,767 | |||||||||||||
|
Other
debt (1) |
6% - 12% | March 2022 - July 2050 | 14,965 | 11,728 | |||||||||||||
| Total debt - principal amounts | $ | 165,514 | $ | 152,688 | |||||||||||||
| Less: debt issuance costs and original issue discounts | (22,542) | (23,536) | |||||||||||||||
| Total debt - carrying amounts | $ | 142,972 | $ | 129,152 | |||||||||||||
| Debt - current portion | $ | 65,588 | $ | 6,181 | |||||||||||||
| Debt - non-current portion | $ | 77,384 | $ | 122,971 | |||||||||||||
| Remainder of the year | 2023 | 2024 | 2025 | 2026 | Thereafter | Total | |||||||||||||||||
| Senior Notes | $ | — | $ | 74,935 | $ | — | $ | — | $ | — | $ | — | $ | 74,935 | |||||||||
| Acquisition Facility | — | — | 4,000 | 4,000 | 32,000 | — | 40,000 | ||||||||||||||||
|
Acquisition-related
promissory notes payable (1) |
2,412 | 3,941 | 17,385 | 1,970 | 6,806 | 3,100 | 35,614 | ||||||||||||||||
| Other debt | 3,718 | 149 | 139 | 109 | 4,579 | 6,271 | 14,965 | ||||||||||||||||
| Total | $ | 6,130 | $ | 79,025 | $ | 21,524 | $ | 6,079 | $ | 43,385 | $ | 9,371 | $ | 165,514 | |||||||||
| Three Months Ended March 31, | |||||||||||
| 2022 | 2021 | ||||||||||
| Interest and accretion - Senior Notes | $ | 5,398 | $ | 5,204 | |||||||
| Interest - Finance lease liabilities | 2,901 | 1,389 | |||||||||
| Interest and accretion - Promissory notes | 737 | 311 | |||||||||
| Interest and accretion - Acquisition Facility | 1,360 | — | |||||||||
| Interest and accretion - Other debt | 479 | 113 | |||||||||
| Capitalized interest | (744) | (85) | |||||||||
| Total interest expense | $ | 10,131 | $ | 6,932 | |||||||
| Interest income | $ | (15) | $ | (97) | |||||||
| Total interest expense, net | $ | 10,116 | $ | 6,835 | |||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Applicable Ratio | Fiscal Quarter Ending | ||||
| 6.00 to 1.00 | March 31, 2023 | ||||
| 5.00 to 1.00 | June 30, 2023 | ||||
| 4.00 to 1.00 | September 30 and December 31, 2023 | ||||
| 3.50 to 1.00 | March 31, 2024 and all fiscal quarters ending thereafter | ||||
|
10. LEASE
OBLIGATIONS | ||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Three Months Ended March 31, | |||||||||||
| 2022 | 2021 | ||||||||||
| Operating lease cost | $ | 886 | $ | 457 | |||||||
| Finance lease cost: | |||||||||||
| Amortization of lease assets | 1,143 | 366 | |||||||||
| Interest on lease liabilities | 2,901 | 1,389 | |||||||||
| Total finance lease cost | $ | 4,044 | $ | 1,755 | |||||||
| Variable lease cost | 93 | $ | 75 | ||||||||
| Total lease cost | $ | 5,023 | $ | 2,287 | |||||||
| March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||
| Finance Leases | Operating Leases | Finance Leases | Operating Leases | ||||||||||||||||||||
| Weighted average discount rate | 11.73 | % | 11.50 | % | 11.75 | % | 11.50 | % | |||||||||||||||
| Weighted average remaining lease term (in years) | 22.2 | 14.4 | 22.6 | 14.6 | |||||||||||||||||||
| Finance Leases | Operating Leases | ||||||||||
| Remainder of the year | $ | 11,711 | $ | 2,150 | |||||||
| 2023 | 11,031 | 2,974 | |||||||||
| 2024 | 11,153 | 2,709 | |||||||||
| 2025 | 11,773 | 2,522 | |||||||||
| 2026 | 11,436 | 2,292 | |||||||||
| Thereafter | 251,898 | 27,866 | |||||||||
| 309,002 | 40,513 | ||||||||||
| Interest on lease liabilities | (207,266) | (22,875) | |||||||||
| Total present value of minimum lease payments | $ | 101,736 | $ | 17,638 | |||||||
| Lease liabilities - current portion | $ | 13,197 | $ | 2,705 | |||||||
| Lease liabilities - non-current | $ | 88,539 | $ | 14,933 | |||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
11. DERIVATIVE
LIABILITIES | ||
|
Total
Derivative Liabilities (1)(3) | ||||||||||||||||||||
| Carrying amounts as of January 1, 2022 | $ | 92,435 | ||||||||||||||||||
|
Fair value changes
(2) |
(14,309) | |||||||||||||||||||
| Derivative Warrants exercises | (9,151) | |||||||||||||||||||
| Carrying amounts as of March 31, 2022 | $ | 68,975 | ||||||||||||||||||
| March 31, 2022 (unaudited) | December 31, 2021 | ||||||||||
| Stock price | $2.85 | $3.25 | |||||||||
| Risk-free annual interest rate | 2.40% | 0.97% | |||||||||
| Range of estimated possible exercise price | $1.25 | $0.04 - $1.25 | |||||||||
| Volatility | 67% | 73% | |||||||||
| Remaining life (years) | 2.7 years | 3 years | |||||||||
| Forfeiture rate | 0% | 0% | |||||||||
| Expected annual dividend yield | 0% | 0% | |||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| As of March 31, 2022 | As of December 31, 2021 | ||||||||||||||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||||||||||||||
| Input | Effect of 10% Increase | Effect of 10% Decrease | Input | Effect of 10% Increase | Effect of 10% Decrease | ||||||||||||||||||||||||||||||
| Stock price | $ | 2.85 | $ | 9,433 | $ | (9,284) | $ | 3.25 | $ | 12,781 | $ | (10,834) | |||||||||||||||||||||||
| Volatility | 67 | % | $ | 1,818 | $ | (1,755) | 73 | % | $ | 4,473 | $ | (3,210) | |||||||||||||||||||||||
|
12. EQUITY | ||
| Expiration Date | Exercise
Price ($) |
Number of Warrants | ||||||||||||
| 2022 | 1.25 - 1.31 | 322,298 | ||||||||||||
| 2023 | 1.47 - 1.50 | 337,500 | ||||||||||||
| 2024 | 1.25 | 36,040,922 | ||||||||||||
| 2025 | 1.25 - 2.97 | 2,068,508 | ||||||||||||
| 2026 | 4.18 | 300,000 | ||||||||||||
| 2029 | 0.50 - 2.00 | 26,367,627 | ||||||||||||
| Total warrants | 65,436,855 | |||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Non-Derivative Warrants |
Derivative
Warrants (2) |
Total Number of Warrants | Weighted - Average Exercise Price | ||||||||||||||||||||||||||||||||
|
Balance as of
January 1, 2022 |
29,156,048 | 40,124,355 | 69,280,403 | $ | 1.19 | ||||||||||||||||||||||||||||||
|
Exercised (1) |
(393,548) | (3,450,000) | (3,843,548) | 1.26 | |||||||||||||||||||||||||||||||
|
Balance as of
March 31, 2022 |
28,762,500 | 36,674,355 | 65,436,855 | $ | 1.19 | ||||||||||||||||||||||||||||||
|
Exercisable
as of March 31, 2022 |
26,899,164 | 36,674,355 | 63,573,519 | $ | 1.15 | ||||||||||||||||||||||||||||||
|
13. SHARE-BASED
COMPENSATION AND OTHER BENEFITS | ||
| Three Months Ended March 31, | |||||||||||||||||
| 2022 | 2021 | ||||||||||||||||
| Stock options | $ | 5,845 | $ | 928 | |||||||||||||
| Restricted stock | 832 | 2,538 | |||||||||||||||
| Warrants | 287 | 547 | |||||||||||||||
| Total share-based compensation expense | $ | 6,964 | $ | 4,013 | |||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Number of Stock Options | Weighted-Average Per Share Exercise Price | |||||||||||||||||||
| Issued and Outstanding as of January 1, 2022 | 20,429,120 | $ | 3.20 | |||||||||||||||||
|
Granted
(1)
|
545,000 | $ | 4.20 | |||||||||||||||||
|
Exercised
(2) |
(249,998) | $ | 1.70 | |||||||||||||||||
| Forfeited/expired | (216,668) | $ | 3.63 | |||||||||||||||||
| Issued and Outstanding as of March 31, 2022 | 20,507,454 | $ | 3.24 | |||||||||||||||||
| Exercisable as of March 31, 2022 | 5,872,425 | $ | 2.02 | |||||||||||||||||
| Expiration Year | Stock Options Outstanding | Exercise Price | Stock Options Exercisable | |||||||||||||||||
| 2028 | 720,000 | $1.00 - $1.35 | 720,000 | |||||||||||||||||
| 2029 | 7,024,668 | $1.26 - $2.75 | 4,670,322 | |||||||||||||||||
| 2030 | 920,834 | $0.91 - $ 3.98 | 345,824 | |||||||||||||||||
| 2031 | 11,321,952 | $3.70 - $6.53 | 136,279 | |||||||||||||||||
| 2032 | 520,000 | $4.20 | — | |||||||||||||||||
| 20,507,454 | 5,872,425 | |||||||||||||||||||
| Three Months Ended March 31, | ||||||||||||||
| 2022 | 2021 | |||||||||||||
| Stock price | $3.94 | $6.13 | ||||||||||||
| Risk-free annual interest rate | 1.83% - 1.90% | 0.45% - 0.69% | ||||||||||||
| Expected annual dividend yield | 0% | 0% | ||||||||||||
| Volatility | 73% | 78% | ||||||||||||
| Expected life of stock options | 5.3 - 7.5 years | 5 - 6.5 years | ||||||||||||
| Forfeiture rate | 0% | 0% | ||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Number of Restricted Subordinate Voting Shares | |||||
| Unvested restricted stock as of January 1, 2022 | 2,859,151 | ||||
|
Granted (1) |
5,952 | ||||
| Cancelled | (7,813) | ||||
| Vested | (100,000) | ||||
| Unvested restricted stock as of March 31, 2022 | 2,757,290 | ||||
|
14. INCOME
TAXES | ||
| Three Months Ended March 31, | ||||||||||||||
| 2022 | 2021 | |||||||||||||
| Income (Loss) Before Income Taxes | $ | (14,706) | $ | (22,739) | ||||||||||
| Income Tax Expense | $ | 5,051 | $ | 8,312 | ||||||||||
| Effective Tax Rate | (34.3)% | (36.6)% | ||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
15. NON-CONTROLLING
INTERESTS | ||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
16. NET
INCOME (LOSS) PER SHARE | ||
| Three Months Ended March 31, | ||||||||||||||
| 2022 | 2021 | |||||||||||||
| Numerator: | ||||||||||||||
| Net income (loss) and comprehensive income (loss) attributable to Jushi shareholders - basic | $ | (19,757) | $ | (30,876) | ||||||||||
| Dilutive effect of net income from derivative warrants liability | (14,309) | — | ||||||||||||
| Net loss and comprehensive loss attributable to Jushi shareholders - diluted | $ | (34,066) | $ | (30,876) | ||||||||||
| Denominator: | ||||||||||||||
| Weighted-average shares of common stock - basic | 183,226,027 | 157,176,375 | ||||||||||||
| Dilutive effect of derivative warrants | 24,612,879 | — | ||||||||||||
| Weighted-average shares of common stock - diluted | 207,838,906 | 157,176,375 | ||||||||||||
| Net income (loss) per common share attributable to Jushi: | ||||||||||||||
| Basic | $ | (0.11) | $ | (0.20) | ||||||||||
| Diluted | $ | (0.16) | $ | (0.20) | ||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| March 31, | |||||||||||
| 2022 | 2021 | ||||||||||
| Stock options | 20,507,454 | 9,658,834 | |||||||||
| Warrants | 28,762,500 | 74,883,956 | |||||||||
|
Restricted stock
(1) |
4,307,290 | 7,359,600 | |||||||||
| Convertible promissory notes | 910,000 | 930,000 | |||||||||
| 54,487,244 | 92,832,390 | ||||||||||
|
17. OPERATING
EXPENSES | ||
| Three Months Ended March 31, | |||||||||||
| 2022 | 2021 | ||||||||||
| Salaries, wages and employee related expenses | $ | 17,336 | $ | 9,882 | |||||||
|
Other
general and administrative expenses (1) |
10,611 | 6,804 | |||||||||
| Share-based compensation expense | 6,964 | 4,013 | |||||||||
| Depreciation and amortization expense | 2,256 | 974 | |||||||||
| Acquisition and deal costs | 141 | 238 | |||||||||
| Total operating expenses | $ | 37,308 | $ | 21,911 | |||||||
|
18. OTHER
INCOME (EXPENSE) | ||
| Three Months Ended March 31, | |||||||||||
| 2022 | 2021 | ||||||||||
| Gains (losses) on investments and financial assets | $ | — | $ | 1,149 | |||||||
| Losses on debt redemptions/extinguishments/modifications | — | (3,815) | |||||||||
| Gains (losses) on legal settlements | 24 | (807) | |||||||||
| Other | (727) | 97 | |||||||||
| Other expense, net | $ | (703) | $ | (3,376) | |||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
19. RELATED
PARTY TRANSACTIONS | ||
| Three Months Ended March 31, | As of | |||||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||||||
| 2022 | 2021 | March 31, 2022 (unaudited) | December 31, 2021 | |||||||||||||||||||||||||||||
| Nature of transaction | Related
Party Income (Expense) |
Related
Party Prepaid/Receivable (Payable) |
||||||||||||||||||||||||||||||
|
Management services
agreements
(1) |
$ | — | $ | (10) | $ | — | $ | — | ||||||||||||||||||||||||
|
Senior Notes
- interest expense and principal amount (2) |
$ | (9) | $ | (46) | $ | (342) | $ | (1,194) | ||||||||||||||||||||||||
|
Loans to senior
key management - interest charged and principal plus accrued interest outstanding (3) |
$ | — | $ | 31 | $ | — | $ | — | ||||||||||||||||||||||||
|
20. COMMITMENTS
AND CONTINGENCIES | ||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
21. FINANCIAL
INSTRUMENTS | ||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||
| Financial assets: | |||||||||||||||||||||||||||||
| Equity investment | $ | — | $ | — | $ | 1,500 | $ | 1,500 | |||||||||||||||||||||
| $ | — | $ | — | $ | 1,500 | $ | 1,500 | ||||||||||||||||||||||
| Financial liabilities: | |||||||||||||||||||||||||||||
|
Derivative
liabilities (1) |
$ | — | $ | — | $ | 68,975 | $ | 68,975 | |||||||||||||||||||||
| Contingent consideration liabilities | $ | — | $ | — | $ | 8,628 | $ | 8,628 | |||||||||||||||||||||
| $ | — | $ | — | $ | 77,603 | $ | 77,603 | ||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||
| Financial assets: | |||||||||||||||||||||||||||||
| Equity investment | $ | — | $ | — | $ | 1,500 | $ | 1,500 | |||||||||||||||||||||
| $ | — | $ | — | $ | 1,500 | $ | 1,500 | ||||||||||||||||||||||
| Financial liabilities: | |||||||||||||||||||||||||||||
|
Derivative
liabilities (1) |
$ | — | $ | — | $ | 92,435 | $ | 92,435 | |||||||||||||||||||||
|
Contingent
consideration liabilities (2) |
— | — | 8,223 | 8,223 | |||||||||||||||||||||||||
| $ | — | $ | — | $ | 100,658 | $ | 100,658 | ||||||||||||||||||||||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
|
22. SUBSEQUENT
EVENTS | ||
| 23. CORRECTION OF ERRORS IN PREVIOUSLY ISSUED FINANCIAL STATEMENTS | ||
|
JUSHI HOLDINGS
INC.
Notes to the
Unaudited Interim Condensed Consolidated Financial Statements
(Amounts
Expressed in Thousands of United States Dollars, Unless Otherwise Stated) |
| ||||
| Consolidated Statement of Cash Flows | |||||||||||||||||
| for Three Months Ended March 31, 2022 | |||||||||||||||||
| As reported | Adjustment | As restated | |||||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||||
| Changes in operating assets and liabilities, net of acquisitions: | |||||||||||||||||
| Prepaid expenses and other current asset | $ | 6,718 | $ | (7,034) | $ | (316) | |||||||||||
| Accounts payable, accrued expenses and other current liabilities | $ | 1,746 | $ | (4,125) | $ | (2,379) | |||||||||||
| Net cash flows used in operating activities | $ | (2,666) | $ | (11,159) | $ | (13,825) | |||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||||
| Payments for property, plant and equipment | $ | (26,476) | $ | 9,437 | $ | (17,039) | |||||||||||
| Net cash flows used in investing activities | $ | (33,068) | $ | 9,437 | $ | (23,631) | |||||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||||
| Receipts (payments) on finance leases, net | $ | (601) | $ | 1,722 | $ | 1,121 | |||||||||||
| Net cash flows provided by financing activities | $ | 16,497 | $ | 1,722 | $ | 18,219 | |||||||||||
| NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||||||||||
| Capital expenditures | $ | 7,566 | $ | 17,373 | $ | 24,939 | |||||||||||
| Consolidated Balance Sheet | |||||||||||||||||
| as of March 31, 2022 | |||||||||||||||||
| As reported | Adjustment | As restated | |||||||||||||||
| NON-CURRENT ASSETS: | |||||||||||||||||
| Right-of use assets - finance leases | $ | 94,087 | $ | 6,000 | $ | 100,087 | |||||||||||
| Total non-current assets | $ | 528,011 | $ | 6,000 | $ | 534,011 | |||||||||||
| Total assets | $ | 650,644 | $ | 6,000 | $ | 656,644 | |||||||||||
| CURRENT LIABILITIES: | |||||||||||||||||
| Accrued expenses and other current liabilities | $ | 32,773 | $ | 6,000 | $ | 38,773 | |||||||||||
| Total current liabilities | $ | 142,339 | $ | 6,000 | $ | 148,339 | |||||||||||
| Total liabilities | $ | 457,487 | $ | 6,000 | $ | 463,487 | |||||||||||
| Total liabilities and equity | $ | 650,644 | $ | 6,000 | $ | 656,644 | |||||||||||
Exhibit 99.2
NOTE TO READER
The Management’s Discussion & Analysis of Jushi Holdings Inc. (the “Company”) for the interim period ended March 31, 2022 has been re-filed on SEDAR (the “Re-filed MD&A”) and replaces the MD&A previously filed by the Company on June 24, 2022. The Re-filed MD&A should be read in conjunction with the condensed unaudited interim consolidated financial statements and notes thereto for the three months ended March 31, 2022 (the “Quarterly Financial Statements”) filed on September 9, 2022. Readers should note that in the Quarterly Financial Statements, the Company restated the (i) Right-of use assets - finance leases and Accrued expenses and other current liabilities in the Interim Condensed Consolidated Balance Sheet and (ii) cash flows from operating, investing and financing activities in the Unaudited Interim Condensed Consolidated Statements of Cash Flows. For further details on the restatement, refer to Note 23 - Correction of Errors in Previously Issued Financial Statements of the Quarterly Financial Statements. The Re-filed MD&A reflects the impact of the restatement.
MANAGEMENT’S DISCUSSION AND ANALYSIS
This Management’s Discussion and Analysis (“MD&A”) covers the consolidated financial statements of Jushi Holdings Inc. and its controlled subsidiaries as of March 31, 2022, and for the three months then ended. Unless the context indicates or requires otherwise, the terms “Jushi”, “the Company”, “we”, “us” and “our” refers to Jushi Holdings Inc. and its controlled entities. This MD&A should be read in conjunction with the condensed unaudited interim consolidated financial statements and notes thereto for the three months ended March 31, 2022 (the “Quarterly Financial Statements”). The Quarterly Financial Statements have been prepared by management and are in accordance with generally accepted accounting principles in the U.S. (“GAAP”) for interim financial information and in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited consolidated financial statements and the accompanying notes thereto for the years ended December 31, 2021 and 2020 (the “Annual Financial Statements”), which are included in Jushi Holdings Inc.’s Amendment No.1 to Form S-1 Registration Statement (“S-1”) that was filed with the SEC on August 8, 2022 and was declared effective on August 12, 2022. All amounts are expressed in United States (“U.S.”) dollars unless otherwise noted.
Forward-Looking Statements
This document may contain “forward-looking statements” and “forward-looking information” within the meaning of applicable securities laws, including Canadian securities legislation and U.S. securities legislation (collectively, “forward- looking information”) which are based upon the Company’s current internal expectations, estimates, projections, assumptions and beliefs. All information, other than statements of historical facts, included in this document that address activities, events or developments that Jushi expect or anticipate will or may occur in the future constitutes forward- looking information. Forward-looking information is often identified by the words, “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions and includes, among others, information regarding: future business strategy, competitive strengths, goals, expansion and growth of Jushi’s business, operations and plans, including new revenue streams, the completion of contemplated acquisitions by Jushi of additional assets, roll out of new operations, the implementation by Jushi of certain product lines, implementation of certain research and development, the application for additional licenses and the grant of licenses that will be or have been applied for, the expansion or construction of certain facilities, the expansion into additional U.S. and international markets, any potential future legalization of adult use and/or medical marijuana under U.S. federal law; expectations of market size and growth in the U.S. and the states in which Jushi operates; expectations for other economic, business, regulatory and/or competitive factors related to Jushi or the cannabis industry generally; and other events or conditions that may occur in the future.
Readers are cautioned that forward-looking information and statements are not based on historical facts but instead are based on reasonable assumptions and estimates of management of Jushi at the time they were provided or made and involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Jushi, as applicable, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information and statements. Such factors include, among others: risks relating to the ability to complete the pipeline transactions; risks relating to U.S. regulatory landscape and enforcement related to cannabis, including political risks; risks relating to anti-money laundering laws and regulation; other governmental and environmental regulation; public opinion and perception of the cannabis industry; risks related to the economy generally; risks relating to pandemics and forces of nature including but not limited to the 2019 novel coronavirus (“COVID-19”); risks related to contracts with third party service providers; risks related to the enforceability of contracts; the limited operating history of Jushi; Jushi’s history of operating losses and negative operating cash flows; reliance on the expertise and judgment of senior management of Jushi; risks inherent in an agricultural business; risks related to co-investment with parties with different interests to Jushi; risks related to proprietary intellectual property and potential infringement by third parties; the concentrated Founder voting control of the Jushi and the unpredictability caused by the anticipated capital structure; risks relating to the Company’s recent debt financing and other financing activities including leverage and issuing additional securities; risks relating to the management of growth; costs associated with Jushi being a publicly-traded company; the Company timely becoming a U.S. filer in addition to a Canadian filer; the transition of the Company's financial reporting from International Financial Reporting Standards to GAAP; increasing competition in the industry; risks associated to cannabis products manufactured for human consumption including
| 31 |
potential product recalls; reliance on key inputs, suppliers and skilled labor; reliance on manufacturers and contractors; risks of supply shortages or supply chain disruptions; cybersecurity risks; ability and constraints on marketing products; fraudulent activity by employees, contractors and consultants; tax and insurance related risks; risk of litigation; conflicts of interest; risks relating to certain remedies being limited and the difficulty of enforcement of judgments and effect service outside of Canada; risks related to executed or future acquisitions or dispositions, including potential future impairment of goodwill or intangibles acquired; sales by existing shareholders; the limited market for securities of the Company; risks related to the continued performance of existing operations in Pennsylvania, Illinois, Nevada, Virginia, California, Ohio and Massachusetts; risks related to the anticipated openings of additional dispensaries; the risks relating to the expansion and optimization of the grower-processor in Pennsylvania, the vertically integrated facilities in Virginia and Massachusetts and the facility in Nevada; the risks related to the opening of a new facilities, including but not limited to in Ohio and Illinois, which are subject to licensing approval; as well as limited research and data relating to cannabis; and risks related to the Company’s critical accounting policies and estimates. Although Jushi has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such forward-looking information and statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such information and statements. Accordingly, readers should not place undue reliance on forward-looking information and statements. Forward-looking information and statements are provided and made as of the date of this MD&A and Jushi does not undertake any obligation to revise or update any forward-looking information or statements other than as required by applicable law.
Company Overview
We are a vertically integrated, multi-state cannabis operator engaged in retail, distribution, cultivation, and processing operations in both medical and adult-use markets. Our management team is focused on building a diverse portfolio of cannabis assets through opportunistic investments, and pursuing application opportunities in attractive limited license jurisdictions. We have targeted assets in highly populated, limited license medical markets on a trajectory toward adult- use legalization, including Pennsylvania and Ohio, markets that are in the process of transitioning to adult-use, namely Virginia, and limited license, fast-growing, large adult-use markets, such as Illinois, Nevada, and Massachusetts, and certain municipalities of California.
Factors Affecting our Performance and Related Trends
COVID-19
At the onset of the COVID-19 pandemic, we implemented new procedures at all operating locations to better protect the health and safety of our employees, medical patients, and customers across our network of dispensaries. Depending on the location, some of the initiatives include, but are not limited to: reducing the number of point-of-sale registers, restricting the number of people permitted in-store, restricting general store hours to permit access to those most susceptible to infection, and offering curbside pick-up. We have also directed a significant amount of traffic to our recently launched online informational tool and reservation platform, www.beyond-hello.com, which enables a medical patient or customer to view real-time pricing and product availability, and reserve products for convenient in-store pick-up at Beyond Hello™ locations across Pennsylvania, Illinois, California, and Virginia.
To date, our financial condition and results of operations have not been materially impacted by COVID-19. The extent to which the COVID-19 pandemic impacts our future results will depend on future developments, which are highly uncertain and cannot be predicted with certainty, including possible future outbreaks of new strains of the virus and governmental and consumer responses to such future developments.
Competition and Pricing Pressure
The cannabis industry is subject to significant competition and pricing pressures, which is often market specific and can be caused by an oversupply of cannabis in the market, and may be transitory from period to period. We may experience significant competitive pricing pressures as well as competitive products and services providers in the markets in which we operate. Several significant competitors may offer products and/or services with prices that may match or are lower
| 32 |
than ours. We believe that the products and services we offer are generally competitive with those offered by other cannabis companies. It is possible that one or more of our competitors could develop a significant research advantage over us that allows them to provide superior products or pricing, which could put us at a competitive disadvantage. Continued pricing pressure due to competition, increased cannabis supply or shifts in customer preferences could adversely impact our customer base or pricing structure, resulting in a material impact on our results of operations, or an impairment of our long-lived assets and intangible assets in future periods.
Recent Developments
Opening 35th Retail Location Nationwide and Fourth Virginia Dispensary
On August 31, 2022, we expanded our retail footprint in Virginia with the opening of our 35th retail location nationally and fourth medical dispensary in Virginia. The dispensary is located in Fairfax, VA and operate under the retail brand Beyond Hello™.
Registered as a U.S. Reporting Issuer
On August 12, 2022, our registration with the SEC as a reporting issuer became effective. As a result, we now report our financial statements in conformity with GAAP.
Settled Lawsuit with Large Multi-State Operator
On August 8, 2022, we announced that we entered into a confidential settlement agreement with Curaleaf Holdings, Inc. and with our former Chief Financial Officer to resolve claims we asserted in a lawsuit filed on July 15, 2022.
Opened 34th Retail Location Nationwide and Third Virginia Dispensary
On July 27, 2022, we expanded our retail footprint in Virginia with the opening of our 34th retail location nationally and third medical dispensary in Virginia. The dispensary is located in Alexandria, VA and operates under the retail brand Beyond Hello™.
Grand Reopening of Beyond Hello™ Palm Springs
On July 11, 2022, we announced the grand reopening of our Beyond Hello™ Palm Springs retail location. The redesigned retail location features a new desert-inspired aesthetic, some of the most sought-after locally sourced cannabis and artisan crafts, along with a new art exhibit from award-winning photographer, Jushi Chief Creative Director Andreas (Dre) Neumann.
Management Changes
On July 12, 2022, we appointed our President Louis Jon Barack as Interim Chief Financial Officer, replacing Ed Kremer who resigned as our Chief Financial Officer on the same date. Additionally, we announced on that same date that James Cabral, formerly our Senior Vice President of Finance, was promoted to Chief Accounting Executive. Mr. Kremer’s resignation was not the result of any disagreement on any matter relating to our operations, policies or practices or any financial or accounting matters.
Debuted Line of Concentrate Products Using Hydrocarbon Extraction
On June 29, 2022, we announced the debut of our first line of concentrates made using hydrocarbon extraction by our award-winning brand The Lab™, which is famous for delivering high-quality, precision vape products and concentrates. The Lab™ Live Resin is the second of several single-source concentrate product lines to be launched. Initially, we will exclusively carry The Lab™ Live Resin 500mg full-spectrum 0.5 gram 510 cartridges at BEYOND/HELLO™ retail locations in Pennsylvania. We plan to roll out our hydrocarbon-extracted line at partner dispensaries across Pennsylvania in the coming months, as well as in additional states such as Massachusetts, Virginia and Nevada.
CEO Purchased Subordinate Voting Shares
| 33 |
On June 27, 2022, we announced that Chief Executive Officer (CEO), Chairman, and Founder, James Cacioppo, purchased 100,000 Subordinate Voting Shares of the Company in the open market for an approximate amount of $151,000. Mr. Cacioppo holds in the aggregate approximately 16.9% of the issued and outstanding Subordinate Voting Shares on a non-diluted basis.
Opened 33rd Retail Location Nationwide and Fourth Dispensary in Nevada
On June 8, 2022, we expanded our retail presence with the opening of our 33rd dispensary nationally and fourth dispensary in Nevada with NuLeaf Las Vegas The Strip. Following the opening of NuLeaf Las Vegas The Strip, our retail operations in Nevada consists of three adult-use and medical dispensaries in Las Vegas and one adult-use and medical dispensary in Lake Tahoe.
Awarded Provisional Medical Marijuana Dispensary License in Ohio
On May 16, 2022, our 100% owned subsidiary, Campbell Hill Ventures, was awarded a provisional medical marijuana dispensary license by the Ohio Medical Marijuana Control Program in the Tri-State area of Cincinnati. The new store will operate under Jushi’s retail brand, BEYOND/HELLO™, and is expected to open by early Q1 2023.
Expanded Product Offerings with the Launch of First Line of Solventless Cannabis Extracts
On May 16, 2022, we announced the debut of our first line of solventless live rosin extracts by our award-winning brand, The LabTM. The new top-shelf product line, includes a 0.5g vape extract cartridge available now and 1g jarred concentrates coming soon for purchase exclusively at BEYOND/HELLO™ store locations in Pennsylvania under the name, The Lab™ Live RSN. The Lab™ Live Rosin is expected to launch at our retail locations in Massachusetts, Nevada and Virginia, pending regulatory approvals.
Opened 3rd Adult-Use and Medical Dispensary in California
On May 13, 2022, we expanded our retail footprint in California with the opening of an adult-use and medical retail dispensary in Grover Beach, California, BEYOND/HELLO™ Grover Beach (Grover Beach). This is our 32nd retail location nationally and third adult-use and medical retail dispensary in California.
Completed Acquisition of Vertically Integrated Operator in Nevada
On April 6, 2022, we closed on the previously announced agreement to acquire NuLeaf for $53.6 million. At close, NuLeaf operated two adult-use and medical retail dispensaries in Las Vegas and Lake Tahoe, in addition to a 27,000 sq. ft. cultivation facility in Sparks, Nevada and a 13,000 sq. ft. processing facility in Reno, Nevada. NuLeaf subsequently opened a third licensed retail dispensary, located directly on Las Vegas Boulevard in Las Vegas, on June 8, 2022.
Completed Acquisition of Las Vegas, Nevada Dispensary
On March 17, 2022, we closed on the previously announced agreement to acquire Apothecarium, an operating adult-use and medical retail dispensary in Las Vegas, Nevada.
Private Placement with Strategic Asset Manager and Long-Term Strategic Investors
On January 26, 2022, we completed a non-brokered private placement offering of an aggregate of 2,717,392 Subordinate Voting Shares at a price of $3.68 per share to Graticule Asset Management Asia for gross proceeds of $10.0 million. On January 31, 2022, we completed a non-brokered private placement offering of an aggregate of 1,000,000 Subordinate Voting Shares at a price of $3.68 per share to Kenneth Rosen and group for gross proceeds of $3.7 million.
Acquisition Facility
On October 20, 2021, we entered into definitive documentation in respect of a $100 million Senior Secured Credit Facility (the Acquisition Facility) with Roxbury, LP acting as agent to SunStream Bancorp Inc. (Sunstream), a joint venture sponsored by Sundial Growers Inc. (NASDAQ:SNDL). The Acquisition Facility is subject to certain customary negative covenants until the 10% Senior Secured Notes mature or are refinanced, including covenants that restrict the Company’s
| 34 |
and its subsidiaries’ ability to pay dividends or make distributions, incur or guarantee additional indebtedness or conduct sales and other dispositions of certain properties or assets. Upon the maturity or refinancing of the 10% Senior Secured Notes, the Company and its subsidiaries who are parties to the the Acquisition Facility will be subject to additional customary negative covenants that, among other things, restrict the Company’s and its applicable subsidiaries’ ability to create liens, make investments, consummate acquisitions, mergers, reorganizations or similar transactions, enter into sale- leaseback transactions, prepay subordinated debt, pay dividends or make distributions, change the line of business and enter into transactions with affiliates.
Results of Operations
(Amounts expressed in thousands of U.S. dollars, except share and per share amounts)
| Three Months Ended March 31, | ||||||||
| 2022 | 2021 | |||||||
| REVENUE, NET | $ | 61,888 | $ | 41,675 | ||||
| COST OF GOODS SOLD | (42,776 | ) | (22,934 | ) | ||||
| GROSS PROFIT BEFORE FAIR VALUE CHANGES | $ | 19,112 | $ | 18,741 | ||||
| OPERATING EXPENSES | $ | 37,308 | $ | 21,911 | ||||
| (LOSS) FROM OPERATIONS BEFORE OTHER (EXPENSE) INCOME | $ | (18,196 | ) | $ | (3,170 | ) | ||
| OTHER (EXPENSE) INCOME: | ||||||||
| Interest expense, net | $ | (10,116 | ) | $ | (6,835 | ) | ||
| Fair value changes in derivative warrants | 14,309 | (9,358 | ) | |||||
| Other, net | (703 | ) | (3,376 | ) | ||||
| Total net other income (expense) | $ | 3,490 | $ | (19,569 | ) | |||
| NET LOSS AND COMPREHENSIVE LOSS BEFORE TAX | $ | (14,706 | ) | $ | (22,739 | ) | ||
| Provision for income taxes | (5,051 | ) | (8,312 | ) | ||||
| NET LOSS AND COMPREHENSIVE LOSS | $ | (19,757 | ) | $ | (31,051 | ) | ||
| Net loss attributable to non-controlling interests | — | (175 | ) | |||||
| NET LOSS AND COMPREHENSIVE LOSS ATTRIBUTABLE TO JUSHI SHAREHOLDERS | $ | (19,757 | ) | $ | (30,876 | ) | ||
| NET LOSS AND COMPREHENSIVE LOSS PER SHARE ATTRIBUTABLE TO JUSHI SHAREHOLDERS - BASIC AND DILUTED | $ | (0.11 | ) | $ | (0.20 | ) | ||
| Weighted average shares outstanding - basic and diluted | 183,226,027 | 157,176,375 | ||||||
| NET (LOSS) AND COMPREHENSIVE (LOSS) PER SHARE ATTRIBUTABLE TO JUSHI SHAREHOLDERS - DILUTED | $ | (0.16 | ) | $ | (0.20 | ) | ||
| Weighted average shares outstanding - DILUTED | 207,838,906 | 157,176,375 | ||||||
| 35 |
Three Months Ended March 31, 2022 and 2021
(Amounts expressed in thousands of U.S. dollars, unless otherwise stated)
Revenue, Net
The following table presents revenue by type for the periods indicated:
| Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | |||||||||||||||||||||||
| Gross revenue | Intercompany Revenue | Revenue to External Customers | Gross revenue | Intercompany Revenue | Revenue to External Customers | |||||||||||||||||||
| Retail | $ | 57,955 | $ | — | $ | 57,955 | $ | 39,277 | $ | — | $ | 39,277 | ||||||||||||
| Wholesale | 9,443 | (5,595 | ) | 3,848 | 4,192 | (1,883 | ) | 2,309 | ||||||||||||||||
| Other | 85 | — | 85 | 89 | — | 89 | ||||||||||||||||||
| Eliminations | (5,595 | ) | 5,595 | — | (1,883 | ) | 1,883 | — | ||||||||||||||||
| Consolidated | $ | 61,888 | $ | — | $ | 61,888 | $ | 41,675 | $ | — | $ | 41,675 | ||||||||||||
Revenue, net for the three months ended March 31, 2022 totaled $61,888, as compared to $41,675 for the three months ended March 31, 2021, an increase of $20,213 or 49%. The increase in retail revenue is due primarily to the Company’s expansion of cannabis operations from build outs and acquisitions. Retail revenue for the three months ended March 31, 2022 was derived from twenty-nine cannabis dispensaries located in Pennsylvania (eighteen), Illinois (four), Massachusetts (two), California (two), Virginia (two) and Nevada (one), whereas, for the three months ended March 31, 2021, Retail revenue was derived from seventeen cannabis dispensaries located in Pennsylvania (eleven), Illinois (four), California (one) and Virginia (one).
The increase in wholesale revenue is primarily attributable to increases in cultivation and manufacturing activity at our grower processor facilities: (i) in Massachusetts due to the acquisition of Nature’s Remedy, which occurred in the third quarter of 2021; (ii) in Virginia due to the commencement of operations at the Dalitso facility in the third quarter of 2021; and (iii) in Pennsylvania due to continued increase sales volume. Wholesale revenue includes inter-segment revenue of $5,595, which is eliminated in consolidation.
Cost of Goods Sold and Gross Profit
Cost of goods sold totaled $42,776 for the three months ended March 31, 2022, as compared to $22,934 for the three months ended March 31, 2021, an increase of $19,842, or 87%. The increase in costs of goods sold is primarily attributable to the increase in amount of products sold.
Gross profit totaled $19,112 for the three months ended March 31, 2022, as compared to $18,741 for three months ended March 31, 2021, an increase of approximately $371 or 2%. As a percentage of revenue, gross profit for the three months ended March 31, 2022 and 2021, was 31% and 45%, respectively. Gross margin decreased primarily due to: (1) approximately $3,500 of labor and overhead costs related to the ramp up of operations in our grower-processor facilities in Virginia and Massachusetts and start-up costs at our new retail dispensaries; and (2) the sell through of inventory acquired in the Nature's Remedy and Apothecarium acquisitions which had a fair value step-up of approximately $3,000. Gross margins were also impacted by the increased promotional activity at our retail locations in Illinois and Massachusetts, and pricing compression in wholesale as we continue to build-out our brands across state markets.
| 36 |
Operating Expenses
Operating expenses for the three months ended March 31, 2022 were $37,308, as compared to $21,911 for the three months ended March 31, 2021, an increase of $15,397 or 70%.
| Three Months Ended March 31, | ||||||||||
| 2022 | 2021 | % Change | ||||||||
| Salaries, wages and employee related expenses | $ | 17,336 | $ | 9,882 | 75% | |||||
| Stock-based compensation expense | 6,964 | 4,013 | 74% | |||||||
| Rent and related expenses | 3,089 | 1,799 | 72% | |||||||
| Professional fees and legal expenses | 2,706 | 1,693 | 60% | |||||||
| Depreciation and amortization expense | 2,256 | 974 | 132% | |||||||
| Software and technology | 1,530 | 567 | 170% | |||||||
| Marketing and selling | 969 | 675 | 44% | |||||||
| Travel, entertainment and conferences | 739 | 405 | 82% | |||||||
| Insurance | 599 | 755 | (21)% | |||||||
| Administration and application fees | 140 | 353 | (60)% | |||||||
| Acquisition and deal costs | 141 | 238 | (41)% | |||||||
| Other G&A | 839 | 556 | 51% | |||||||
| Total operating expenses | $ | 37,308 | $ | 21,910 | 70% | |||||
The total increase in operating expenses is due to the increase in the size and scope of our general and administrative functions to support our expanded operations resulting from organic growth and acquisitions. The primary increases are from an increase in: salaries, wages, labor and employee related expenses as a result of the increase in the number of employees to support our ongoing growth and resulting from recent acquisitions; share-based compensation primarily due to recent stock options granted to new employees and management; professional fees and legal expenses, primarily due to our transition to GAAP reporting and costs associated with our registration with the SEC, which we expect to complete by the third quarter of 2022; and depreciation and amortization expense and rent and related expenses due to the additions of property, plant and equipment and finance lease right-of-use assets from acquisitions and investment in infrastructure as we continue to scale.
Other (Expense) Income
Interest Expense, Net
Interest expense, net, was $10,116 for the three months ended March 31, 2022 as compared to $6,835 for the three months ended March 31, 2021, an increase of $3,281, or 48%. The increase in interest expense, net, is due primarily to an increase in interest-bearing borrowings including finance leases and acquisition-related financing.
Fair Value Changes in Derivatives
Fair value changes in derivatives was a net gain of $14,309 for the three months ended March 31, 2022, as compared to a net loss of $9,358 for the three months ended March 31, 2021. Fair value changes in derivatives include the fair value gains or losses relating to the derivative warrants liability. The derivative warrants are required to be remeasured at fair value at each reporting period. The fair value changes in derivatives for the three months ended March 31, 2022 and 2021 were primarily attributable to the movement in the Company’s stock price during the corresponding period.
Other, Net
Other expense, net, was $703 for the three months ended March 31, 2022, as compared to $3,376 for the three months ended March 31, 2021, a decrease of $2,673 or 79%. Other expense, net, for the three months ended March 31, 2021 primarily related to losses on redemptions of 10% Senior Secured Notes of $3,815, partially offset by $1,149 gains on investments in securities..
| 37 |
Income Tax Expense
Total income tax expense was $5,051 for the three months ended March 31, 2022, as compared to $8,312 for the three months ended March 31, 2021, a decrease of $3,261, or 39%. The decrease in income tax expense is primarily due to a reduction in our accrual for uncertain tax positions related to periods no longer open under the statute of limitations.
Non-GAAP Measures and Reconciliation
In addition to providing financial measurements based on GAAP, we provide additional financial metrics that are not prepared in accordance with GAAP. We use non-GAAP financial measures, in addition to GAAP financial measures, to understand and compare operating results across accounting periods, for financial and operational decision making, for planning and forecasting purposes and to evaluate our financial performance. These non-GAAP financial measures are EBITDA, Adjusted EBITDA and Adjusted Gross Profit (defined below). We believe that these non-GAAP financial measures reflect our ongoing business by excluding the effects of expenses that are not reflective of our operating business performance and allows for meaningful comparisons and analysis of trends in our business. These non-GAAP financial measures also facilitate comparing financial results across accounting periods and to those of peer companies. As there are no standardized methods of calculating these non-GAAP measures, our methods may differ from those used by others, and accordingly, the use of these measures may not be directly comparable to similar measures used by others, thus limiting their usefulness. Accordingly, these non-GAAP measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
EBITDA, Adjusted EBITDA and Adjusted Gross Profit
EBITDA, Adjusted EBITDA and Adjusted Gross Profit are financial measures that are not defined under GAAP. We define EBITDA as net income (loss), or “earnings”, before interest, income taxes, depreciation and amortization. We define Adjusted EBITDA as EBITDA before: (i) non-cash share-based compensation expense and other one-time charges; (ii) inventory-related adjustments; (iii) fair value changes in derivatives; (iv) other (income) expense items; (v) start-up costs; and (vi) transaction costs. These financial measures are metrics that have been adjusted from the GAAP net income (loss) measure in an effort to provide readers with a normalized metric in making comparisons more meaningful across the cannabis industry, as well as to remove non-recurring, irregular and one-time items that may otherwise distort the GAAP net income measure. Other companies in our industry may calculate this measure differently, limiting their usefulness as comparative measures. Management defines Adjusted Gross Profit as gross profit, as reported, adjusted to exclude certain inventory-related adjustments and start-up costs (within cost of goods sold).
| 38 |
Reconciliation of EBITDA and Adjusted EBITDA (Non- GAAP Measures)
The table below reconciles net loss to EBITDA and Adjusted EBITDA for the periods indicated. The table below may contain slight summation differences due to rounding.
(Amounts expressed in thousands of U.S. dollars)
| Three Months Ended March 31, | ||||||||
| 2022 | 2021 | |||||||
| NET LOSS (1) | $ | (19,757 | ) | $ | (31,051 | ) | ||
| Income tax expense | 5,051 | 8,312 | ||||||
| Interest expense, net | 10,116 | 6,835 | ||||||
| Depreciation and amortization (2) | 3,248 | 1,579 | ||||||
| EBITDA (Non-GAAP) | $ | (1,342 | ) | $ | (14,325 | ) | ||
| Non-cash share-based compensation and other one-time charges (3)(8) | 7,159 | 4,053 | ||||||
| Inventory-related adjustments (4) | 3,742 | — | ||||||
| Fair value changes in derivatives | (14,309 | ) | 9,358 | |||||
| Other (income) expense, net (5) | 380 | 3,472 | ||||||
| Start-up costs (6)(8) | 2,715 | 1,292 | ||||||
| Transaction costs (7)(8) | 780 | 238 | ||||||
| Adjusted EBITDA (Non-GAAP) | $ | (875 | ) | $ | 4,088 | |||
| (1) | Net loss includes amounts attributable to non-controlling interests. |
| (2) | Includes amounts that are included in cost of goods sold and in operating expenses. |
| (3) | Includes: (i) non-cash share-based compensation expense for the period; and (ii) severance costs. |
| (4) | Includes: (i) inventory step-up on business combinations; (ii) inventory recall reserves; and (iii) reserves for discontinued products. The inventory step-up on business combinations relate to the fair value write-up on inventory acquired on the business acquisition date and then sold subsequent to the acquisition date. The inventory recall reserves relate to the estimated impact of the Pennsylvania Department of Health recall and ban of vape products containing certain cannabis concentrates. |
| (5) | Includes: (i) remeasurement of contingent contingent consideration related to acquisitions; (ii) losses (gains) on legal settlements; and (iii) losses (gains) on investments and financial assets. |
| (6) | Expansion and start-up costs incurred in order to prepare a location for its intended use. Start-up costs are expensed as incurred and are not indicative of ongoing operations of each new location. |
| (7) | Transaction costs include: (i) registration statement costs such as professional fees and other costs relating to our SEC registration; and (ii) acquisition and deal costs. |
| (8) | During the second quarter of 2021, we revised our methodology for calculating Adjusted EBITDA to also adjust for the effects of acquisition and deal costs, severance costs and start-up costs. We revised our methodology for calculating Adjusted EBITDA because we believe that the fluctuations caused in our operating results from these items are not reflective of our core performance, and that the revised methodology provides management and investors more useful information to evaluate the operations of our business. The prior period data for these items has been added to conform to current period presentation. |
| 39 |
Reconciliation Adjusted Gross Profit (Non- GAAP Measures)
| Three Months Ended March 31, | ||||||||
| 2022 | 2021 | |||||||
| Gross profit | $ | 19,112 | $ | 18,741 | ||||
| Inventory-related adjustments(1) | 3,742 | — | ||||||
| Start-up costs (within COGS)(2) | 1,930 | 467 | ||||||
| Adjusted gross profit | $ | 24,784 | $ | 19,208 | ||||
| (1) | Includes: (i) inventory step-up on business combinations; (ii) inventory recall reserves; and (iii) reserves for discontinued products. The inventory step-up on business combinations relate to the fair value write-up on inventory acquired on the business acquisition date and then sold subsequent to the acquisition date. The inventory recall reserves relate to the potential impact of the Pennsylvania Department of Health recall and ban of vape products containing certain cannabis concentrates. The ban was lifted in June 2022. |
| (2) | Expansion and start-up costs incurred in order to prepare a location for its intended use. Start-up costs are expensed as incurred and are not indicative of ongoing operations of each new location. |
Liquidity and Capital Resources
(Amounts expressed in thousands of U.S. dollars, unless otherwise stated)
Cash Flows
The Company had cash and cash equivalents of $75,717, total current assets of $122,633, and current liabilities (inclusive of the current portion of debt) of $148,339 (as restated) as of March 31, 2022. The Company therefore had a net working capital deficit of $25,706 (as restated). Refer to Note 23 - Correction of Errors in Previously Issued Financial Statements of the Quarterly Financial Statements for further information on the restatement.
The major components of our statements of cash flows for the three months ended March 31, 2022 and 2021 are as follows:
| Three Months Ended March 31, | ||||||||
| 2022 | 2021 | |||||||
| Net cash flows used in operating activities (2022, as restated)(1) | $ | (13,825 | ) | $ | (3,121 | ) | ||
| Net cash flows used in investing activities (2022, as restated)(1) | (23,631 | ) | (8,906 | ) | ||||
| Net cash flows provided by financing activities (2022, as restated)(1) | 18,219 | 88,295 | ||||||
| Effect of currency translation on cash | (9 | ) | (40 | ) | ||||
| Net change in cash and cash equivalents | $ | (19,246 | ) | $ | 76,228 | |||
| (1) | The Company restated the interim condensed consolidated statement of cash flows for the three months ended March 31, 2022. The corrections resulted in an increase in net cash flows used in operating activities from $2,666 (as reported) to $13,825 (as restated), a decrease in net cash used in investing activities from $33,068 (as reported) to $23,631 (as restated), and an increase in net cash flows provided by financing activities from $16,497 (as reported) to $18,219 (as restated). These corrections did not have an impact on the net change in cash and cash equivalents and restricted cash, and earnings during the three months ended March 31, 2022. Refer to Note 23 - Correction of Errors in Previously Issued Financial Statements of the Quarterly Financial Statements for further information. |
Cash Flows Used in Operating Activities
Net cash used in operations during the three months ended March 31, 2022 was $13,825 (as restated), as compared to $3,121 for the three months ended March 31, 2021. The increase in net cash used in operations for the three months ended March 31, 2022 is due primarily to an increase in net loss after non-cash adjustments and an increase in usage of working capital.
Cash Flows Used in Investing Activities
Net cash used in investing activities totaled $23,631 (as restated) for the three months ended March 31, 2022, as compared to $8,906 for the three months ended March 31, 2021. The net cash used in investing activities for the three months ended
| 40 |
March 31, 2022 was comprised of: $17,039 (as restated) for the purchases of property, plant and equipment for use in the Company’s operations, and $6,592 paid for the acquisition of Apothecarium, net of cash acquired. The net cash used in investing activities for the three months ended March 31, 2021 was comprised of: $3,592 paid for the acquisition of Grover Beach; $8,566 for the purchases of property, plant and equipment for use in the Company’s operations; partially offset by: $3,252 in proceeds from sale of investments.
Cash Flows Provided by Financing Activities
Net cash provided by financing activities totaled $18,219 (as restated) for the three months ended March 31, 2022, as compared to $88,295 for the three months ended March 31, 2021. The net cash provided by financing activities for the three months ended March 31, 2022 was comprised of: $13,680 in proceeds from private placement equity offerings in January and February 2022; $3,265 in proceeds from other debt; $1,121 (as restated) in net receipts on finance leases, and $541 in proceeds from the exercise of warrants and stock options; partially offset by: $258 in principal redemption repayments on the 10% Senior Secured Notes; and $130 in payments on other debt. The net cash provided by financing activities for the three months ended March 31, 2021 was comprised of: $85,660 in proceeds from public equity offerings, net of issuance costs, in January and February 2021; $9,886 in proceeds from the exercise of warrants and stock options; and $1,134 in proceeds from other debt; partially offset by: $8,134 in principal redemption repayments on the 10% Senior Secured Notes; and $251 in lease obligation payments.
Balance Sheet Exposure
As of March 31, 2022, primarily all of our balance sheet is exposed to U.S. cannabis-related activities. We believe our operations are in material compliance with all applicable state and local laws, regulations and licensing requirements in the states in which we operate. However, cannabis remains illegal under U.S. federal law. All of our revenue is derived from U.S. cannabis operations. For information about risks related to U.S. cannabis operations, please refer to “Risk Factors” section included in our S-1.
Sources and Uses of Liquidity
Since our inception, we have funded our operations and capital spending through cash flows from sales, and the issuance of debt and equity. Jushi has successfully raised approximately $461 million to date (which includes equity offerings, 10% Senior Secured Notes, warrant/option exercises and draw downs on the Acquisition Facility), of which approximately $47 million was invested by management and insiders. We generate cash from sales and are deploying capital to acquire and develop assets capable of producing additional revenues and earnings over both the immediate and long term to support our business growth and expansion. As of March 31, 2022, we have borrowed $40 million from the $100 million Acquisition Facility to fund the cash portions of acquisitions. We may increase the total commitment of the Acquisition Facility by an aggregate amount of up to $25 million subject to certain conditions, and have the ability under our current base shelf prospectus in Canada to issue C$500 million subscription receipts, debt securities, convertible securities, warrants, subordinate voting shares, and units, or any combination thereof.
Our primary uses of cash are for working capital requirements, acquisitions, capital expenditures and debt service payments. Working capital is used principally for our personnel as well as costs related to the purchase of inventory, cultivation, manufacture and production of our products. Our capital expenditures consist primarily of the construction and improvement of grower-processer facilities and retail dispensaries.
As reflected in our Quarterly Financial Statements, we have incurred losses from operations for the three months ended March 31, 2022, have an accumulated deficit of $262,175 as of March 31, 2022, and have cash and cash equivalents of $75,717 as of March 31, 2022. As discussed in Note 9 – Debt in our Quarterly Financial Statements, the 10% Senior Secured Notes, which mature on January 15, 2023, had an aggregate principal amount outstanding of $74,935. In addition, the Acquisition Facility (see Note 9 - Debt in the Quarterly Financial Statements) required us to maintain certain covenants which we may not have been in compliance with if the court accepted Jushi Europe’s petition for bankruptcy. We were also projected to violate certain financial covenants further within the next twelve months from March 31, 2022. We have been working with various lenders to refinance the 10% Senior Secured Notes at terms most favorable to us.
| 41 |
Given the changing conditions in the debt capital markets, refinancing term sheets are still being negotiated. These conditions raise a substantial doubt regarding our ability to continue as a going concern.
In April 2022, we entered into an amendment with the lender of the Acquisition Facility, which included a waiver related to Jushi Europe’s bankruptcy and a change to the terms of the Total Leverage ratio, as defined in the Acquisition Facility agreement, and deferred the commencement date of leverage testing under the Acquisition Facility. We are pursuing strategies to obtain the required additional funding primarily to fund the 10% Senior Secured Notes and future operations. The strategies may include, but are not limited to: (i) ongoing efforts with certain lenders to refinance the 10% Senior Secured Notes; (ii) deferral of certain expenditures, including capital projects, and reallocate funds for debt repayment, if the need arose; (iii) alternative sources of debt and equity financing, including secured borrowings and through a base shelf prospectus, which allows us to offer up to C$500,000 in securities in Canada through the end of 2023. However, there can be no assurance that we will be able to refinance the 10% Senior Secured Notes, generate positive results from operations, or obtain additional liquidity when needed or under acceptable terms, if at all.
Refer to Note 9 - Debt of our Quarterly Financial Statements for additional information on our debt instruments and related covenants.
Off-Balance Sheet Arrangements and Contractual Obligations
As of March 31, 2022, we do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material current or future effect on the financial performance or financial condition of the Company. For our contractual obligations, refer to Note 9 - Debt, Note 10 - Lease Obligations, and Note 20 - Commitments and Contingencies of our Quarterly Financial Statements.
Critical accounting policies and estimates
There were no material changes to our critical accounting policies and estimates from the information provided in Note 2 of our audited consolidated financial statements and notes thereto for the year ended December 31, 2021, included in our S-1.
42
Exhibit 99.3
Jushi Holdings Inc. Files Restated First Quarter 2022 Financial Statements
BOCA RATON, Fla., Sept. 09, 2022 (GLOBE NEWSWIRE) -- Jushi Holdings Inc. (“Jushi” or the “Company”) (CSE: JUSH) (OTCQX: JUSHF), a vertically integrated, multi-state cannabis operator, today filed with the Canadian securities regulator restated unaudited condensed interim consolidated financial statements for the three months ended March 31, 2022 (the “Q1 2022 Interim Financial Statements”). The restated Q1 2022 Interim Financial Statements can be accessed through the Company’s public filings on the System for Electronic Document Analysis and Retrieval (“SEDAR”).
The Q1 2022 Interim Financial Statements, which have been prepared under generally accepted accounting principles in the United States, have been filed on SEDAR to replace the previously filed financial statements prepared under IFRS by the Company on June 24, 2022. The Company restated the (i) Right-of use assets - finance leases and Accrued expenses and other current liabilities in the unaudited interim condensed consolidated balance sheet and (ii) cash flows from operating, investing and financing activities in the unaudited interim condensed consolidated statements of cash flows. These errors did not impact the cash balance as of March 31, 2022, and there was no net change in cash flows during the three months then ended.
About Jushi Holdings Inc.
We are a vertically integrated cannabis company led by an industry-leading management team. In the United States, Jushi is focused on building a multi-state portfolio of branded cannabis assets through opportunistic acquisitions, distressed workouts, and competitive applications. Jushi strives to maximize shareholder value while delivering high-quality products across all levels of the cannabis ecosystem. For more information, visit jushico.com or our social media channels, Instagram, Facebook, Twitter and LinkedIn.
Forward-Looking Information and Statements
This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation as well as statements that may constitute "forward-looking statements" within the meaning of within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, contained in this press release, including statements regarding our strategy, future operations, intended expansion of our retail operations and production capacity, intended expansion of our cultivation facilities, future financial position, projected costs, prospects, plans and objectives of management, including without limitation materiality or significance and effects of errors on current or prior period financial statements, and any future determinations of the Company, the Audit Committee or the Company’s management related thereto, are forward-looking statements. These forward-looking statements are based on Jushi’s current expectations and beliefs concerning future developments and their potential effects. As a result, actual results could differ materially from those expressed by such forward-looking statements and such statements should not be relied upon. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans,” “expects” or “does not expect,” “is expected,” “budget,” “scheduled,” “estimates,” “forecasts,” “intends,” “anticipates” or “does not anticipate,” or “believes,” or variations of such words and phrases or may contain statements that certain actions, events or results “may,” “could,” “would,” “might” or “will be taken,” “will continue,” “will occur” or “will be achieved”. The forward-looking information and forward-looking statements contained herein may include but are not limited to, information concerning the expectations regarding Jushi, or the ability of Jushi to successfully achieve business objectives, and expectations for other economic, business, and/or competitive factors. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including risks related to the ability of Jushi to successfully and/or timely achieve business objectives, including with regulatory bodies, employees, suppliers, customers and competitors; changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws; compliance with extensive government regulation, the risk that additional information or other subsequent events arise that would require us to make additional adjustments, as well as other risks, uncertainties and other cautionary statements in the Company’s public filings with the applicable securities regulatory authorities on the SEC’s website at www.sec.gov and on SEDAR at www.sedar.com. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated, or expected.
Although the Company believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to the Company or persons acting on its behalf is expressly qualified in its entirety by this notice.
For further information, please contact:
Investor Relations Contact:
Michael Perlman
Executive Vice President of Investor Relations
561-281-0247
investors@jushico.com
Media Contact:
Ellen Mellody
570-209-2947
ellen@mattio.com