iAnthus Reports Losses, Q2 Revenue Drops 20% YoY

iAnthus Capital Holdings, Inc. ITHUF IAN Q2 2022 revenue was $43.5 million, a sequential increase of 2% from Q1 2022 and a decrease of 20% from the same period in the prior year.

Q2 2022 Financial Highlights

• Gross profit of $19.7 million, a sequential decrease of 13% when compared to Q1 2022 and a decrease of 37% from the same period in the prior year.

• Gross margin of 45.2%, reflecting a sequential decrease of 733bps from Q1 2022 and a decrease of 1,251bps from the same period in the prior year.

• Net loss of $373.6 million, or a loss of $0.65 per share, compared to a loss of $10.1 million or a loss of $0.06 per share in Q1 2022, and compared to a loss of $15.3 million, or a loss of $0.09 per share, in the same period in the prior year. The net loss in Q2 2022 was driven primarily by of a one-time, non-cash loss on debt extinguishment of $316.6 million resulting from the company's consummation of its previously announced recapitalization transaction.

• Adjusted EBITDA of $2.3 million, a sequential decrease from $3.4 million in Q1 2022 and decrease from $13.5 million from the same period in the prior year.

• On June 24, 2022, the company closed the recapitalization transaction pursuant to the terms of a restructuring support agreement dated July 10, 2020, as amended on June 15, 2021, by and among the company, all of the holders of the 13.0% senior secured convertible debentures issued by iAnthus Capital Management, LLC ("ICM"), a wholly-owned subsidiary of the company, and a majority of the holders of the company's 8.0% unsecured convertible debentures and pursuant to the terms of the amended and restated plan of arrangement under the Business Corporations Act approved by the Supreme Court of British Columbia.

• On the closing date, the company entered into a third amended and restated secured debenture purchase agreement with ICM, the other credit parties, Gotham Green Admin 1, LLC, as collateral agent, and the lenders party thereto pursuant to which ICM issued the new secured lenders an additional $25.0 million of 8.0% secured debentures, which accrue interest at the rate of 8.0% per annum, with maturity date of June 24, 2027.

Photo by Diyahna Lewis on Unsplash

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