Colorado Cannabis Company Schwazze Reports $30.7 Million Q2 Revenue

Schwazze Announces Second Quarter Results
  • Revenue Increases 467% to $30.7 Million Compared to $5.4 Million in Q1 2020
  • Adjusted EBITDA is $10.0 Million, 32.6% of Revenue
  • On Track to Meet Guidance of Annual Projected Revenue of Approximately $110 Million – $125 Million Annual Projected Adjusted EBITDA $30 Million – $36 Million
  • Conference Call and Webcast Scheduled for Today – 4:30 pm ET

DENVER, Aug. 16, 2021 /PRNewswire/ – Schwazze, (OTCQX: SHWZ) (“Schwazze” or the “Company”), announced financial results for its second quarter year ended June 30, 2021 (“Q2 2021”).

Financial Summary for Q2 2021:

  • Revenues of $30.7 million grew 467% over Q2 2020 and 58.9% over Q1 2021
  • Gross Margin of $14.9 million was 48.5%, 576 bps better than Q2 2020 and 1,099 bps over Q1 2021
  • Adjusted EBITDA of $10.0 million was 32.6% of revenue, 239 bps above Q1 2021
  • Net Income was $4.4 million or $0.08 Diluted Earnings per share compared to a Net Loss in Q2 2020 of ($6.6) million or ($0.16) Diluted Net Loss per share and compared to a Net Loss in Q1 2021 of ($3.6) million or ($0.09) Diluted Net Loss per share
  • Cash Flow from operations for the six-month period was $1.4 million
  • Same store sales of the seventeen Star Buds dispensaries when compared to last year were $21.5M up 16%.
    • Average basket size was $61.04 up 6.4%
    • Recorded customer visits were 357,056 up 8.9% 
      Note: Schwazze did not own all the assets in 2020 and are using unaudited numbers for this comparison.

Other Q2 2021 Highlights

Acquisition of Southern Colorado Growers: The Company announced on June 1, 2021, that it had entered into a transaction to acquire the assets of Southern Colorado Growers in Huerfano County, Colorado (transaction closed July 22, 2021). The acquisition includes 36 acres of land with outdoor cultivation capacity, as well as indoor, greenhouse, and hoop house cultivation facilities and equipment. This purchase expanded Schwazze’s footprint in Colorado, is the Company’s first major move into cultivation, and will provide high-end, premium cannabis directly to its Star Buds dispensaries as well as significant production of biomass for its PurpleBee’s extraction and manufacturing facility.

Acquisition of Drift Dispensaries: The Company announced that it had signed definitive documents to acquire the assets of BG3 Investments, LLC dba Drift which consists of two marijuana retail stores located in Boulder, Colorado, bringing the total number of Schwazze Colorado dispensaries to nineteen.

We have continued to see strong revenue growth over last year and are pleased with our adjusted EBITDA results. Furthermore, we continue to be encouraged with our retail results, which saw growing sales by 68.9% on a two-year basis.

Justin Dye, CEO of Schwazze

Wholesale results, led by PurpleBee’s distillate also had another record-breaking sales quarter. We continue to execute on our retail and manufacturing playbook with excellent results and with the addition of Southern Colorado Growers and Drift, we look forward to continuing to add to our portfolio of companies.

Second Quarter 2021 Revenue

Total revenue was $30.7 million during the three months ended June 30, 2021, compared to $5.4 million during the same period in 2020 and represents an increase of approximately 467%. Retail sales grew to $21.5 million over the quarter from $0.7 million dollars the previous year and wholesale operations revenue increased to $9.2 million from $4.1 million compared to the same period last year. Other sales decreased to $0.02 million from $0.59 million due to a reduced focus on consulting. The increase in retail and wholesale revenue is attributed to the acquisition of Mesa Organics in April 2020 and the completion of the acquisition of Star Buds in March 2021.

Total cost of goods and services were $15.8 million during the three months ended June 30, 2021, compared to $3.1 million during the same period in 2020. This increase was due to improved sales from our retail and wholesale operations.

Gross profit increased to $14.9 million during the three months ended June 30, 2021, compared to $2.3 million during the same period in 2020. Gross profit margin increased as a percentage of revenue from 48.5% to 42.7% mostly driven by the strength of Star Buds acquisition, and our consolidated purchasing approach.

Total operating expenses were $10.5 million during the second quarter compared to $8.7 million during the same period in 2020. The higher expenses were due to increased selling, general and administrative expenses, and salaries from the addition of the dispensaries.

Q2 2021 net income was $4.4 million, or a gain of approximately $0.10 per share on a basic weighted average, as compared to net loss of $6.6 million, or a loss of approximately $0.16 per share on a basic weighted average during the three months ended June 30, 2020.

Q2 2021 adjusted EBITDA was $10.0 million, representing 32.6% of revenue. This is derived from Operating Income and adjusting one-time expenses, merger and acquisition and capital raising costs, non-cash related compensation costs, and depreciation and amortization. See the financial table for Adjusted EBITDA below for details for Q2 2021 adjustments.

During the two quarters, the Company generated positive operating cash flow of $1.4 million and $19.9 million in total cash flow for the first two quarters with $21.1 million in cash and cash equivalents at the end of Q2 2021.

Nancy Huber, CFO for Schwazze commented, “We continue to generate operating cash flows from our acquired businesses. This quarter we used that cash flow to make strategic inventory purchases for third quarter usage.”

2021 Guidance

The Company is reiterating its 2021 guidance which excludes transactions that are announced but not closed. Annual revenue guidance is $110 million to $125 million and projected annual adjusted EBITDA from $30 million to $36 million.

Adjusted EBITDA represents income (loss) from operations, as reported, before tax, adjusted to exclude non-recurring items, other non-cash items, including stock-based compensation expense, depreciation, and amortization, and further adjusted to remove acquisition related costs, and other one-time expenses, such as severance. The Company uses adjusted EBITDA as it believes it better explains the results of its core business. The Company has not reconciled guidance for adjusted EBITDA to the corresponding GAAP financial measure because it cannot provide guidance for the various reconciling items. The Company is unable to provide guidance for these reconciling items because it cannot determine their probable significance, as certain items are outside of its control and cannot be reasonably predicted. Accordingly, a reconciliation to the corresponding GAAP financial measure is not available without unreasonable effort.

Q2 2021 Webcast

Investors and stakeholders may participate in the conference call by dialing 416 764 8650 or by dialing North American toll free 888-664-6383 or listen to the webcast from the Company’s website at The webcast will be available on the Company’s website and on replay until August 30, 2021, and may be accessed by dialing 888 390 0541 / Code 605725#.

Following their prepared remarks, Chief Executive Officer, Justin Dye and Chief Financial Officer, Nancy Huber will answer investor questions. Investors may submit questions in advance or during the conference call itself through the weblink: This weblink has been posted to the Company’s website and will be archived on the website. All Company SEC filings can also be accessed on the Company website at

About Schwazze

Schwazze (OTCQX: SHWZ) is building the premier vertically integrated cannabis company in Colorado and plans to take its operating system to other states where it can develop a differentiated leadership position. Schwazze is the parent company of a portfolio of leading cannabis businesses and brands spanning seed to sale. The Company is committed to unlocking the full potential of the cannabis plant to improve the human condition. Schwazze is anchored by a high-performance culture that combines customer-centric thinking and data science to test, measure, and drive decisions and outcomes. The Company’s leadership team has deep expertise in retailing, wholesaling, and building consumer brands at Fortune 500 companies as well as in the cannabis sector. Schwazze is passionate about making a difference in our communities, promoting diversity and inclusion, and doing our part to incorporate climate-conscious best practices. Medicine Man Technologies, Inc. was Schwazze’s former operating trade name. The corporate entity continues to be named Medicine Man Technologies, Inc.

Schwazze derives its name from the pruning technique of a cannabis plant to enhance plant structure and promote healthy growth.

Original press release

Published by NCV Newswire
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