Unrivaled Brands (OTCQX:UNRV) Inc, a vertically integrated, multi-state cannabis company, said it has made significant progress on its previously disclosed 100-day turnaround plan.
The Santa Ana, Calif.-based company has operations in California and Oregon. In California, Unrivaled operates three dispensaries with direct-to-consumer delivery, two grow facilities, and several popular company-owned brands. In Oregon, Unrivaled operates a statewide distribution network, brands, and outdoor and greenhouse cultivation.
In a statement, Unrivaled Brands Chairman Eric Baum said: “In the company’s initial communication to shareholders in May, we indicated that our immediate focus was on our 100-day plan to stabilize operations, protect our performing assets, create a sustainable debt position and put us on the path to profitability in an increasingly challenging industry and a struggling California market.”
He added: “I am pleased to report progress against this plan – while humbly acknowledging that there is still a lot of work ahead of us.”
In March, the company conducted a thorough review of Unrivaled’s balance sheet and determined the health of each of its business units.
“In the second quarter, we took decisive steps to significantly reset the cost structure, including tightening operations, improving financial systems and controls, and restructuring our debt,” Baum said. “We have since closed several underperforming assets…reducing our SG&A run rate by approximately $5 million per year.”
Baum revealed that Unrivaled’s strategy now is to focus on operations in Oregon, its retail stores in Oakland and Santa Ana, as well as marketing and licensing of Korova, one of the brands the most sought after on the west coast. High-potency Korova products are currently available in California, Oregon, Arizona and Oklahoma, along with Sticks and Cabana, the company said.
Unrivaled noted that he achieved the following:
- Outsourced distribution: In June of last year, Unrivaled partnered with a leading North American cannabis distributor with a strong fulfillment infrastructure, to distribute its brands, while simultaneously exiting third-party distribution commitments. that affected cash flow;
- Closure of underperforming retail businesses: Unparalleled closed underperforming outlets in Los Angeles, San Leandro and Sacramento. Where possible, assets from these sites have been deployed to support other business operations and the company is commercializing closed assets and licenses;
- Reduction of management and staff: As of August 1, 2022, Unrivaled’s roster is 188, up from 338 at the end of the first quarter. The reduction stems primarily from site closures and corporate downsizing. Overall, the wage bill has been reduced by 40%;
“Moving forward, we are focused on stabilizing and growing operations, improving the balance sheet and restructuring debt,” Baum said. “We are also actively reviewing options for additional sources of capital and potential mutually beneficial partnerships.”
Unrivaled said it is considering experienced candidates for the CEO role and is expected to share updates in the coming weeks and months.
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