SAN DIEGO, Feb. 18, 2013 -- Medical Marijuana, Inc. (OTCPink: MJNA), a leading cannabis and hemp industry innovator, today announced the release of its annual shareholders report including the 2012 financial statements with audited fourth quarter financials (Post 2/19/2013- OTC Markets). The Company earned net income of approximately $7.1 million on record gross revenues of $12.38 million for the year ended December 31, 2012. The company achieved significant growth in revenue and turned profitable during the year while also acquiring and developing some of the most recognizable and trusted brands in the industry. Below you will find the company's 2012 operating and development highlights.
Operational and development highlights
Operating highlights for the year are as follows:
-Acquired a 50% interest in CanChew Biotechnologies (Click to View Patents: US and International)
-Established GMP manufacturing partnership for large scale production of CBD chewing gum
-Executed soft launch and market survey in Q4 with over 400 customers selected from 1500 applicants
-Secured corporate approval and funding to begin development and clinical trials for European FDA equivalent medical drug approval
-Developing and extending patent rights to include other Active Pharmaceutical Ingredients (API's)
-Developed a dual platform to sell the CanChew Gum as an Over the Counter (OTC) product without medical claim, while simultaneously securing its future clinical development
-Received Legal opinion letter from corporate FDA council allowing company to market and sell CBD products while using the term "CBD" or "Cannabidiol" within the label and packaging of it's Over the Counter (OTC) product
Red Dice Holdings
-Acquired the rights and intellectual property to Dixie Elixirs, the most recognized product brand in the medical marijuana industry
-Increased product distribution in Colorado to over 500 retail locations
-Established the first licensing relationship in Arizona for the Dixie Elixirs brand
-Developed and launched the first high concentration CBD Hemp Wellness product line, called Dixie X which was subsequently re-launched as Dixie Botanicals to more appropriately demonstrate the broad brand platform
-Established GMP manufacturing partnership for large scale production and distribution of Dixie Botanicals
-Launched the first wholesale sales team in California for Dixie Botanicals
-Dixie Botanicals Hemp Oil Dew Drops won first place in Hemp Connoisseurs Cirque de Cannabis competition while the Dixie Elixirs Medicated Chocolate Truffle placed second in the Edibles category at the High Times Magazine Cannabis Cup
-Received significant media attention of the brand including the following (to view click on title):
60 Minutes "Overtime" segment
60 Minutes "Rocky Mountain High Segment"
Fast Company "Innovation Agents"
PBS / WBUR
Newsweek October 22 Cover Story, "The New Pot Barons"
Newsweek Cover Story Photo Gallery
-Acquired 80% of PhytoSphere Systems (Photo Gallery)
-Harvested approximately 1,000 acres of specialty Hemp cultivars developed to yield high levels of Cannabidiols (CBD)
-Entered into agreement to license the brand name PhytoSphere and PhytoSphere Systems to Cannavest, as well as sold its excess inventory and production agreement\facilities for $35 million in cash and stock. This agreement allows MJNA to focus on the development of its brands and future acquisitions instead of farming or production. The companies reached an agreement to sell the CBD rich hemp oil to MJNA subsidiaries at a much reduced cost and without any additional upfront development and infrastructure costs
-The company has now produced its specialty Hemp cultivars in three countries, establishing a complete network of farmers within the microclimates necessary to produce its High Cannabidiol (CBD) Cultivars that are used for extraction
-The company established a production team, research lab, and extraction team to produce and export the High Value Hemp Cannabidiol Oil
-Company successfully produced over 560 Million Milligrams of High Value Cannabidiol Hemp Oil
-Formed Canipa Holdings as a holding company for European product approvals, import and export as well as distribution agreements
-Received approval to market and sell Hemp oil and Hemp based wellness products in Romania through an established distribution partner, once markets have been established the company will then look to license brands to distribution partners throughout Europe
-Completed study with Romania based institution on the positive effect of CBD's on a variety of ailments
Wellness Managed Services (WMS)
-Secured a management contract valued at $1.7 million annually, realized over $1 million in revenue
-Continued negotiations to provide management services to various wellness centers and retail outlets. Due to competing priorities, the Company delayed these discussions until the Q1 2013
-Company sees significant acquisition opportunities within this segment of the market
-Once a facility is acquired WMS can integrate MJNA's entire portfolio of products and services, truly providing the industry with the first fully integrated and branded stores. These services can include the following:
-Dixie Elixir and Dixie Botanicals branded products
-HempMeds Rx Products
-PhytoSPHERE Systems (Co-licensing opportunities with Cannavest)
-Integrated seed to sale tracking solution for all products
-Security, taxation, inventory control and management
-Branding, marketing and product integration
-Store capitalization, expansion or disposition
-Completed first ever audit in company's history with audit of Q4 financials. Accounting firm is currently auditing the prior 7 quarters to produce 2 years of fully audited financials
-The Company has completed and submitted all documentation necessary for a market tier up listing (OTC)
-The Company and its counsel have submitted all required documentation and legal opinion letters for the removal of the Depository Trust Corporation (DTC) imposed "chill"
-Received an opinion letter from counsel stating that it is legal to import, export and sell hemp products in the United States while using the word "cannabidiol" in its name, labeling and marketing materials
Corporate Revenue Guidance for 2013-2014
The company is pleased to issue its first ever Sales Guidance and Outlook for 2013-2014. The company forecasts revenue for 2013 to be $47,000,000 with operating cash flows of $32,000,000 and has the potential to increase revenues in 2014 to $155,000,000 with operating cash flows of approximately $95,000,000.
The company has spent the last year building its branding and product platform. Today the company has some of the most recognizable brands in the industry, and is focused on its core businesses and product distribution platforms, such as the Dixie Brand of products, Wellness Managed Services and CanChew Biotechnologies. Dixie is expected to have substantial growth through licensing and the acquisition, development and distribution of additional products, while Wellness Managed Services focuses on growth through the acquisition of retail health and well ness facilities and management contracts. CanChew Biotechnologies is purely focused on it's Over the Counter (OTC) product line, starting its clinical trials and expanding on its patents and intellectual property (IP).
Additionally and as further described in the shareholder report, the Company entered into an agreement in December to license PhytoSphere Systems and sell its inventory to CannaVest, a hemp based agricultural company specializing in the development and sales of hemp based products. While the agreement was reached in December and an initial installment payment was made, the final sale agreement and transfer of assets will occur in Q1 2013. The terms of the licensing agreement and inventory sale call for payment by CannaVest to the Company of $35 million in cash and stock. This cash flow will enable the Company to focus on building its core business through the expansion of its branded products and acquisition of additional brands while leaving the ground work of farming, harvesting, extraction and product development to CannaVest. In addition the Company will continue to benefit from solid supply chain relationships with PhytoSphere for future purchases of high value CBD oil at a significant cost savings.
"2012 was an exciting and challenging year for the Company. We have had changes in management, expansion of our brands, the changing of state and international legislature, which has afforded us the opportunities of unimaginable growth. We are especially pleased to be able to meet our earlier commitment of providing our shareholders with the company's first audited financials and positioning the Company for eventual up listing. The audit process is long and costly, especially for a company that is in our industry, with the constant changes in banking, state and international guidelines. Our plan is simple in regards to bringing the company to a fully reporting status. First we need to have our 24 months audit completed, second we then submit all of the finalized 24 month audited results to a PCAOB SEC approved auditing firm who recertifies our prior audit and we submit to the SEC with the appropriate filings. We chose to take a two-step approach with this in order to save a significant amount of costs and time." said Michelle Sides , Chairman of Medical Marijuana, Inc. Sides went on to say, "The strength of our financial results along with the impressive achievements described above should give new and existing shareholders confidence that MJNA will be a dominant player in this fast growing industry."
Finally, as many investors are aware, the Company has been the subject of various derogatory articles published by bloggers and penny stock newsletters. We take these statements and allegations very seriously and are working with our attorneys to evaluate all of our legal options. We will defend our Company and the hard work that so many people have put in to build our business. We thank you, our loyal shareholders and valued customers, for your continued support.
Financial Tables for 2012
Three months ended
Mar. 31, 2012
Three months ended
Jun. 30, 2012
Three months ended
Sep. 30, 2012
Three months ended
Dec. 31, 2012
This press release may contain certain forward-looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the Safe Harbor created by those sections. This material contains statements about expected future events and/or financial results that are forward-looking in nature and subject to risks and uncertainties. Such forward-looking statements by definition involve risks, uncertainties and other factors, which may cause the actual results, performance or achievements of Medical Marijuana, Inc. to be materially different from the statements made herein.
About Medical Marijuana, Inc.
Our mission is to be the premier cannabis and hemp industry innovators, leveraging our team of professionals to source, evaluate and purchase value-added companies and products, while allowing them to keep their integrity and entrepreneurial spirit. We strive to create awareness within our industry, develop environmentally friendly, economically sustainable businesses, while increasing shareholder value. For more information, please visit the company's website at: www.MedicalMarijuanaInc.com.
Medical Marijuana, Inc.
Toll Free: 888-OTC-MJNA (888-682-6562)
Investor Relations Contact:
Stuart T. Smith
SOURCE Medical Marijuana, Inc.