10-K: MariMed Inc. Reports Increased Revenue for Fiscal Year 2024, Completes Key Acquisition

MariMed Inc. announces a 6.3% increase in revenue for fiscal year 2024, driven by wholesale growth and strategic acquisitions, including the completion of the FSCC acquisition.

Summary

• MariMed Inc., a multi-state cannabis operator, reported a 6.3% increase in total revenue for the year ended December 31, 2024, reaching $157.96 million compared to $148.598 million in 2023.
• The increase was primarily driven by a $14.1 million increase in wholesale revenue, offset by a $4.0 million decrease in retail revenue.
• The company completed the acquisition of First State Compassion Center (FSCC) in Delaware on February 28, 2025.
• MariMed operates in Massachusetts, Delaware, Illinois, Maryland, Missouri, and Ohio, holding 33 cannabis licenses.
• The company's strategic growth plan focuses on completing acquisitions, increasing product brand revenue, and expanding retail store revenue.
• The company closed a $58.7 million secured credit facility with Needham Bank in November 2023, refinancing previous debt and unencumbering operating assets.
• The company's net loss attributable to common stockholders was $12.164 million, compared to a net loss of $16.031 million in the previous year.
• Adjusted EBITDA was $19.649 million, compared to $24.674 million in the previous year.
• The company experienced a cybersecurity incident in September 2023, resulting in a $0.7 million loss.
• The company is subject to Section 280E of the Internal Revenue Code, which prohibits the deduction of certain ordinary business expenses.

Sentiment

Score: 6

Explanation: The document presents a mixed picture. Revenue increased, and a key acquisition was completed, but profitability declined, and a cybersecurity incident occurred. The company faces regulatory and competitive challenges.

Positives

• The company completed the acquisition of FSCC in Delaware on February 28, 2025, which is critical to the implementation of their strategic growth plan.
• The company closed a $58.7 million secured credit facility with Needham Bank in November 2023, refinancing previous debt and unencumbering operating assets.
• Wholesale revenue increased by 28.9% due to growth in Maryland and Illinois.
• The company is expanding its brand portfolio to meet consumer demand.
• The company is focused on improving customer experience and expanding its retail footprint.

Negatives

• Retail revenue decreased by $4.0 million.
• The company experienced a cybersecurity incident resulting in a $0.7 million loss.
• The company's net loss attributable to common stockholders was $12.164 million.
• Adjusted EBITDA decreased from $24.674 million to $19.649 million.
• The company is subject to Section 280E of the Internal Revenue Code, which prohibits the deduction of certain ordinary business expenses.

Risks

• Cannabis remains illegal under United States federal law.
• The company faces increasing competition.
• The company is subject to limits on its ability to own licenses.
• The company may have difficulty accessing banking services.
• The company's insurance coverage may be inadequate.
• The company is subject to cybersecurity risks.
• The company's market price of common stock has been historically volatile and could continue to be volatile.
• The company's internal controls over financial reporting may not be effective.

Future Outlook

The company continues to focus on executing its strategic growth plan, with priority on completing acquisitions, increasing product brand revenue, and expanding retail store revenue.

Industry Context

The cannabis industry is rapidly evolving, with increasing competition and regulatory changes. MariMed is positioning itself as a multi-state operator with a focus on vertical integration and brand development.

Comparison to Industry Standards

• The document mentions Multi-State Operators (MSOs) and Single State Operators as competitors.
• The document mentions BDSA estimates that total cannabis sales in Ohio will reach $802 million in 2025.
• The document mentions that the Massachusetts cannabis market generated $1.6 billion in sales in 2024.
• The document mentions that the Illinois cannabis market reported over $2 billion in total legal cannabis sales in the rolling twelve months ended June 30, 2024.
• The document mentions that the Maryland cannabis market reported $1.1 billion in medical and adult-use cannabis sales during the first 12 months of the adult-use program.
• The document mentions that the Missouri cannabis market sold over $1.4 billion worth of legal cannabis in Missouri in 2024.

Legal Proceedings

• In 2022, the Plan Administrator filed a complaint against MMH for alleged preferential transfers, which was settled in 2023 by reducing MMH's general unsecured claims to $15.5 million.

Related Party Transactions

• The company's corporate offices are leased from an entity in which the company's President and Chief Executive Officer (the 'CEO') has an investment interest.
• The company procures nutrients, lab equipment, cultivation supplies, furniture and tools from an entity owned by the family of the company's Chief Operating Officer (the 'COO').
• The company pays royalties on the revenue generated from its Bettys Eddies product line to an entity owned by the COO and the company's Chief Revenue Officer (the 'CRO') under a royalty agreement.
• During the years ended December 31, 2024 and 2023, one of the company's majority-owned subsidiaries paid distributions of approximately $5,000 and $11,000, respectively, to the CEO, who owns a minority equity interest in such subsidiary.
• On June 10, 2024 (the 'Membership Unit Purchase Date'), the CEO and COO purchased 5% and 15%, respectively, of the membership units of Mari Holdings Metropolis, LLC, one of the company's majority-owned subsidiaries
• At December 31, 2024, the company's mortgages with Bank of New England and DSB were personally guaranteed by the CEO.

Stakeholder Impact

• Shareholders: The company's performance impacts shareholder value, with revenue growth offset by net losses.
• Employees: The company's expansion and acquisitions may create new job opportunities.
• Customers: The company's focus on product quality and customer experience aims to improve customer satisfaction.
• Suppliers: The company's procurement activities support its supply chain.
• Creditors: The company's debt obligations and refinancing activities affect its financial stability.

Next Steps

• The company will continue to focus on executing its strategic growth plan.
• The company will continue to strengthen its cultivation and processing capabilities.
• The company will continue to develop and launch innovative new products.
• The company will continue to broaden its distribution network.
• The company will continue to expand its dispensary footprint.

Key Dates