A torrid week for cannabis media and especially cannabis media workers. First “Civilized” and now “High Times”. When a press release was sent out a few weeks back saying that Dope magazine was being folded into High Times and the Dope “office” being moved from Seattle to LA the writing was on the wall.
Here at CLR, we thought High Times might limp into the New Year, but the news is already here.
Ganjapreneur report
Hightimes Holding: ‘Substantial Doubt’ in Magazine’s Future
Hightimes Holding Corp. disclosed doubts about the High Times magazine’s ability to continue operations due to “recurring operating losses, net operating cash flow deficits, and an accumulated deficit.”
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.
Read their article at
https://www.ganjapreneur.com/hightimes-holding-substantial-doubt-in-magazines-future/
This is what the NY Post is saying
The cannabis industry may be booming, but publishers looking to cash in keep going up in smoke.
Hightimes Holding, which publishes the 45-year-old High Times magazine, warned shareholders in its latest SEC filing that it may not be able to continue operations.
“Because of recurring operating losses, net operating cash flow deficits, and an accumulated deficit, there is substantial doubt about the company’s ability to continue as a going concern for one year from the issuance of the financial statements,” the company said.
High Times has snapped up rival publications, including Dope, Culture and Green Rush Daily, and runs marijuana-themed concerts and events, but its crowdsourced IPO has stalled. It recently hired Toronto-based Lazer & Lazer to search for a new backer as it tries to dig out of $105.2 million in debts.
In its most recent earnings report, Hightimes Holding incurred a net loss of $11.9 million for the six months ended June 30, 2019, on revenue of $10.7 million.
The publication has been a cornucopia of unrealistic numbers, dreams & ideas as this NY Post article earlier in the year (April 3) attests to. Crazy deals and renumeration for a publishing CEO that was just plain silly. No wonder they couldn’t get people to buy into it.
The debt-laden owner of stoner magazine High Times has tapped an entertainment executive to be its new chief as it seeks to compete in the increasingly crowded marijuana marketplace through conferences, award ceremonies and other live events.
High Times Holdings on Wednesday named Kraig Fox, a director of Dick Clark Productions, as its new CEO. Prior to working with Dick Clark Productions, which produces the Golden Globes and the American Music Awards, Fox was a founder and chief operating officer of Core Media, the company behind “American Idol” and “So You Think You Can Dance.”
The unusual choice comes as High Times — founded as a 1970s counterculture rag aimed at weed fans — has been on a buying spree aimed at taking advantage of the marijuana boom driven by the legalization movement in the US and Canada.
Since private equity firm Oreva Capital bought High Times in 2017, the company has purchased a music label, a video-on-demand platform and a slew of pot zines — and is in the final stages of acquiring cannabis conferences the Big Industry Show in the US and Spannabis in Barcelona.
That is in addition to its existing events, including award ceremony the Cannabis Cup and annual festival Reggae on the River.
“We’re the only cannabis company that has a brand,” said Adam Levin, the head of Oreva Capital, which bought the company from friends of the colorful founder.
Levin, who was High Times’ CEO and will now be executive chairman, said the company also plans to make money from licensing and retailing.
“Maybe this new guy can fix High Times — I don’t know,” Penney said of Fox.“There’s a wave of change sweeping the country, and it’s not going to end soon,” agreed Howard Penney, an analyst at research firm Hedgeye.
Indeed, while the acquisitions may be positioning the company to take advantage of the $50 billion US cannabis market, they have also placed the company in a precarious financial situation, whereby it has been taking on millions in debt despite losing money as recently as 2017, according to its last publicly available financial statement.
Its recent acquisition of magazine Dope Media, for example, was listed at a price of $11.2 million. But as so with many of its deals, the bulk of the acquisition price was paid for with High Times stock and the cash payout has been delayed.
Fox’s appointment also comes as Oreva struggles to pull off a public stock offering to help offset its debt-fueled acquisition spree — which investment newsletter Seeking Alpha has warned investors off of, saying the company’s “financials and its competitive positioning are toxic.”
“I’ll enjoy the opportunity to prove them wrong,” said Levin, who claims he has attracted 20,000 stockholders and raised more than $15 million so far.
In an unusual twist, the new CEO’s $465,000 salary will be reduced to just $1 until the company raises another $10 million in its slow-moving IPO — giving Fox incentive to attract even more new investors.
Source: https://nypost.com/2019/04/03/high-times-owner-hopes-stoner-mag-will-see-green-with-new-ceo/
More to come we’re sure!
