Medical Marijuana, Inc. (OTCMKTS:MJNA) Pops After Annual Report
It has been a long time coming but it is finally here. Medical Marijuana, Inc. (OTCMKTS:MJNA) published its long-overdue annual report late last week. The stock caught on to this saving straw and pulled hard, climbing in double digits in two consecutive market sessions. On Friday MJNA closed another 12% up, nearly making up for its last red streak, and stopped at $0.08 per share.
Is there much reason for excitement, though? There should be at least one, if you look at the PR accompanying the filing. However, that PR also contains what is very peculiar wording. The release headline proudly states that sales “increased 280%+” over the previous year. This is simply a twist on the truth. 2014 annual sales are actually around 280% OF 2013 sales, but the increase is really 180% – a significant difference by any standards.
Here is the brief summary of the report’s balance sheet:
- $678 thousand in checkings/savings
- $4.0 million in total current liabilities
- $14.5 million in annual 2014 sales income (vs $5.0 million in 2013)
- $4.4 million in annual 2014 net loss
The year-over-year increase in annual net sales is from $5.0 million to $14.5 million. Once again, you don’t need to have studied calculus to be able to see that this is an INCREASE of 180%, not 280% as the PR states. The 2014 sales figure COMPRISES 280% OF the previous one, but the actual INCREASE is just 180%. The CEO letter to MJNA shareholders actually furthers this skewed way of presenting annual results and calls it a “nearly 300% increase”.
The simple fact of the matter is that in 2013, without counting the extraordinary income in CANV shares from the sale of Phytosphere, MJNA logged a bottom line of $211 thousand in the black. 2014 ended with a loss of $4.4 million.
MJNA lists $2.5 million in “legal and professional fees” for 2014, $1.1 million of that was incurred by HempMedsPX. The company is also involved as a party under five separate legal actions, either directly or through its subsidiaries.
Considering the Kannaway acquisition took place in late December, the next quarterly report should finally shed some light on how much Kannaway and its allegedly great sales can improve MJNA‘s bottom line. The quarterly was due last Friday, but MJNA filed for an extension. The new deadline is May 20, just two days from now. Hopefully, the report will come through on time and not a month later, as it happened with the annual.
