Hightimes Holding says there is “substantial doubt” about the company’s ability to continue operations in a Securities and Exchange Commission report by the firm outlined by the New York Post. The company says the uncertainty is due to “recurring operating losses, net operating cash flow deficits, and an accumulated deficit.”
In the report, Hightimes Holding had a net loss of $11.9 million on revenue of $10.7 million for the six months ending on June 30, 2019. The company has $105.2 million in debts.
In late October, the majority of DOPE Magazine’s Seattle editorial team was laid off by High Times – which acquired DOPE last year – and the office was shuttered. High Times CEO Kraig Fox called the move a “strategic decision” but noted that some employees had accepted positions at the company’s Los Angeles headquarters.
In addition to DOPE, High Times also purchased Green Rush Daily last year for $7 million and CULTURE magazine for $4 million.
The flurry of acquisitions came in conjunction with High Times’ Regulation A public offering – a new scheme that allows firms to sell shares directly to non-institution investors. The move followed the company’s plans to go public with an IPO, but that plan sputtered out. Regulation A is, essentially, crowdfunding that allows public offerings from companies in amounts of $50 million or less raised over one year.
The company has raised more than $15 million by more than 20,000 individual investors via the Reg A offering over a year after the funding was announced. Earlier this year, High Times Executive Chairman Adam Levin indicated the company was still seeking a NASDAQ listing but was also considering Canadian exchanges or over-the-counter (OTC) trading in the United States.
Do you work for a cannabis brand? Take our 5-minute survey to help us report on the industry: Click Here