Leafly(US:LFLY)2022-11-14 21:04Financial Performance - Revenue for Q3 2022 was $11,781,000, an increase of 8.1% compared to $10,896,000 in Q3 2021[18] - Gross profit for Q3 2022 reached $10,266,000, up from $9,635,000 in Q3 2021, reflecting a gross margin improvement[18] - Operating expenses for Q3 2022 totaled $16,298,000, compared to $13,470,000 in Q3 2021, representing a 20.9% increase[18] - The net income for Q3 2022 was $15,454,000, a significant turnaround from a net loss of $4,454,000 in Q3 2021[18] - Basic net income per share for Q3 2022 was $0.43, compared to a loss of $0.18 per share in Q3 2021[18] - For the nine months ended September 30, 2022, Leafly reported a net income of $10,837,000, compared to a net loss of $6,880,000 for the same period in 2021[26] - Total revenue for the nine months ended September 30, 2022, was $35,251, an increase from $30,959 in the same period of 2021[120] - Total gross profit for the three months ended September 30, 2022, was $10,266, compared to $9,635 in the same period of 2021, reflecting a gross profit margin improvement[120] Assets and Liabilities - Total assets as of September 30, 2022, were $36,828,000, slightly up from $36,153,000 at the end of 2021[16] - Total current liabilities decreased to $8,503,000 from $44,725,000 at the end of 2021, indicating improved financial health[16] - The company reported an accumulated deficit of $58,933,000 as of September 30, 2022, down from $69,770,000 at the end of 2021[16] - Cash and cash equivalents were $27,829,000 as of September 30, 2022, compared to $28,565,000 at the end of 2021[16] Cash Flow and Expenses - Net cash used in operating activities was $25,130,000 for the nine months ended September 30, 2022, compared to $3,101,000 for the same period in 2021[26] - Cash, cash equivalents, and restricted cash at the end of the period was $28,436,000, down from $33,246,000 at the end of September 2021[26] - Stock-based compensation expense increased significantly to $3,159,000 in 2022 from $729,000 in 2021[26] - The company reported a significant increase in bad debt expense to $1,023,000 in 2022 from $841,000 in 2021[26] Mergers and Acquisitions - The merger with Merida on February 4, 2022, resulted in Leafly becoming a wholly-owned subsidiary of Merida, with a total of 42,924,000 shares outstanding post-merger[30] - Cash received from escrow from the merger amounted to $8,089,000 from February 4, 2022, to September 30, 2022[32] - Leafly's total payment to Merida public redeeming stockholders was $49,466,000 at the closing of the merger[32] Stock and Equity - The Company repurchased 3,081 shares of its common stock at a weighted-average price of $10.28 per share for a total of $31,663[80] - The Public Warrants allow holders to purchase one share of common stock at an exercise price of $11.50, with 6,501 warrants outstanding as of September 30, 2022[86] - The Private Warrants, totaling 3,950, are non-redeemable as long as held by initial purchasers and are exercisable for cash or on a cashless basis[90] - The Company has the option to redeem the 2022 Notes at a cash redemption price equal to 100% of the principal amount plus accrued interest[62] Employee Compensation and Stock Options - The 2021 Equity Incentive Plan reserved 4,502 shares for issuance, with automatic increases starting January 1, 2023, based on the lesser of 10% of fully diluted shares or 4,502 shares[98] - In August 2022, the company granted stock options for 101 shares at an exercise price of $1.98 per share and 1,228 restricted stock units[99] - As of September 30, 2022, there was $114 of unrecognized compensation cost related to stock options, expected to be recognized over 3.36 years[100] - The company recorded a charge of $1,366 for modified stock options granted to the CEO, reflecting changes in vesting provisions[108] Market and Compliance - The Company received notifications from Nasdaq regarding noncompliance with the $50 million market value requirement and the $1.00 minimum bid price requirement for continued listing[133] - The Company has until April 26, 2023, to regain compliance with the minimum bid price requirement, needing a market value of $50 million for 10 consecutive business days[135] Restructuring and Future Plans - The estimated cash pre-tax restructuring charges due to the Restructuring Plan are approximately $500,000, primarily in Q4 2022[132] - The Company plans to decrease total headcount by approximately 56 employees as part of the restructuring efforts[131]