California-based Medical Marijuana Inc. closed out 2012 on a high note, reporting a record $3.4 million profit in the fourth quarter as it continued to gain traction in the edibles and hemp markets.
The company – which trades on the over-the-counter market under the symbol MJNA – posted a $62,711 loss for the same period in 2011. Its revenues rose nearly twelvefold from a year earlier to hit a new quarterly high of $5.10 million for the last three months of 2012.
The whole industry should eye Medical Marijuana Inc. and other publicly traded MMJ companies closely, as they can serve as a barometer of how the investment community feels about cannabis opportunities in general. Many medical cannabis and hemp stocks, for example, soared after Colorado and Washington legalized marijuana for recreational use as optimism rose among investors.
The industry also needs a handful of strong, stable and credible publicly traded companies to highlight the potential of the medical marijuana business. Most publicly traded cannabis companies trade on the over-the-counter (OTC) market and are classified as “penny stocks,” which are subject to extreme volatility and are viewed as highly risky investments.
Medical Marijuana Inc. falls into that category but is hoping to gain more credibility with investors, possibly by moving from the OTC market to a more reputable stock exchange. It has hired an accounting firm to officially audit its quarterly financial documents for the past two years. Such audits are required each quarter on exchanges like the Nasdaq but are not mandatory on the over-the-counter market.
“The audit process is crucial to our up-listing plans as well as to provide our shareholders confidence in our financial reporting,” Michelle Sides, chairman of Medical Marijuana Inc., said in a release. “We are obviously pleased with our Q4 results, but are even more excited about the opportunity for MJNA in this ever-growing industry.”
Medical Marijuana Inc. owns several companies involved in the medical cannabis industry, including the biotech/cultivation firm PhytoSphere and Red Dice Holdings, which runs infused products maker Dixie Elixirs & Edibles. Its portfolio of businesses also includes several firms focused on hemp-based products, such as CanChew Bio-Technologies and HempMeds RX.
Medical Marijuana Inc. reported several milestones in the fourth quarter that helped fuel revenues.
Among the biggest:
– Dixie Elixirs, which is quickly becoming its flagship company, continued to expand aggressively across the country, developing wholesale partnerships in Arizona, California, New Mexico and Washington. It also received national media exposure, appearing on “60 Minutes,” CNN and PBS.
– PhytoSphere Systems boosted production of hemp cannabidiol (CBD) oil for Medical Marijuana Inc.’s products and third-party sales by 50% on a quarter-to-quarter basis.
Aside from revenue-generating moves, Medical Marijuana Inc. also invested in the future and laid the groundwork to expand internationally, finalizing plans for European clinical trials of CanChew and agreeing to pump $4.7 million into the effort.
The company’s stock rose 25% on the financial results, hitting 15 cents a share. It has settled down a bit this morning and is trading at about 14 cents. A year ago, Medical Marijuana Inc. was trading at just 3 cents.