| NOTE 15 - SEGMENT INFORMATION |
The
Company’s operating and reportable segments are currently organized around the following products that it offers as part
of its core business strategy:
| |
· |
Herbs
and Produce Products – Includes herbs and leafy greens that are grown using classic Dutch hydroponic farming
methods. |
| |
· |
Cannabis
Dispensary, Cultivation and Production – Includes cannabis-focused retail, cultivation and production. |
Summarized
financial information concerning the Company’s reportable segments is shown in the following tables. Total asset amounts
at June 30, 2018 and 2017 exclude intercompany receivable balances eliminated in consolidation.
| |
|
For
the Three Months Ended June 30, 2018
(Unaudited) |
|
| |
|
Herbs
and Produce Products |
|
|
Cannabis
Dispensary, Cultivation and Production |
|
|
Eliminations
and Other |
|
|
Total |
|
| Total
Revenues |
|
$ |
1,502,789 |
|
|
$ |
7,203,971 |
|
|
$ |
11,417 |
|
|
$ |
8,718,177 |
|
| Cost
of Goods Sold |
|
|
958,694 |
|
|
|
5,551,060 |
|
|
|
- |
|
|
|
6,509,754 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross Profit |
|
|
544,095 |
|
|
|
1,652,911 |
|
|
|
11,417 |
|
|
|
2,208,423 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Selling,
General and Administrative Expenses |
|
|
994,906 |
|
|
|
2,823,524 |
|
|
|
4,183,940 |
|
|
|
8,002,370 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loss
from Operations |
|
|
(450,811 |
) |
|
|
(1,170,613 |
) |
|
|
(4,172,523 |
) |
|
|
(5,793,947 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other
Income (Expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amortization of
Debt Discount |
|
|
- |
|
|
|
- |
|
|
|
(417,363 |
) |
|
|
(417,363 |
) |
| Loss on Extinguishment
of Debt |
|
|
- |
|
|
|
- |
|
|
|
(3,127,477 |
) |
|
|
(3,127,477 |
) |
| Loss on Fair Market
Valuation of Derivatives |
|
|
- |
|
|
|
- |
|
|
|
(1,653,000 |
) |
|
|
(1,653,000 |
) |
| Interest Expense |
|
|
- |
|
|
|
- |
|
|
|
(331,379 |
) |
|
|
(331,379 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Other Income
(Expense) |
|
|
- |
|
|
|
- |
|
|
|
(5,529,219 |
) |
|
|
(5,529,219 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
Loss |
|
$ |
(450,811 |
) |
|
$ |
(1,170,613 |
) |
|
$ |
(9,701,742 |
) |
|
$ |
(11,323,166 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total
Assets at June 30, 2018 |
|
$ |
6,320,906 |
|
|
$ |
71,591,669 |
|
|
$ |
31,878,438 |
|
|
$ |
109,791,013 |
|
| |
|
For
the Three Months Ended June 30, 2017
(Unaudited) |
|
| |
|
Herbs
and Produce Products |
|
|
Cannabis
Dispensary, Cultivation and Production |
|
|
Eliminations
and Other |
|
|
Total |
|
| Total
Revenues |
|
$ |
1,777,067 |
|
|
$ |
6,049,319 |
|
|
$ |
16,487 |
|
|
$ |
7,842,873 |
|
| Cost
of Goods Sold |
|
|
1,325,729 |
|
|
|
5,010,771 |
|
|
|
- |
|
|
|
6,336,500 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross Profit |
|
|
451,338 |
|
|
|
1,038,548 |
|
|
|
16,487 |
|
|
|
1,506,373 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Selling,
General and Administrative Expenses |
|
|
855,999 |
|
|
|
2,210,475 |
|
|
|
2,962,813 |
|
|
|
6,029,287 |
|
| |
|
|
|
|
|
|
|
|
|
. |
|
|
|
|
|
| Loss
from Operations |
|
|
(404,661 |
) |
|
|
(1,171,927 |
) |
|
|
(2,946,326 |
) |
|
|
(4,522,914 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other
Income (Expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amortization of
Debt Discount |
|
|
- |
|
|
|
- |
|
|
|
(515,654 |
) |
|
|
(515,654 |
) |
| Loss on Extinguishment
of Debt |
|
|
- |
|
|
|
- |
|
|
|
(1,639,137 |
) |
|
|
(1,639,137 |
) |
| Gain on Fair Market
Valuation of Derivatives |
|
|
- |
|
|
|
- |
|
|
|
987,200 |
|
|
|
987,200 |
|
| Interest Expense |
|
|
- |
|
|
|
- |
|
|
|
(130,510 |
) |
|
|
(130,510 |
) |
| Loss on Fair Market
Valuation of Contingent Consideration |
|
|
- |
|
|
|
(77,286 |
) |
|
|
- |
|
|
|
(77,286 |
) |
| Gain on Settlement
of Contingent Consideration |
|
|
- |
|
|
|
4,991,571 |
|
|
|
- |
|
|
|
4,991,571 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Other Income
(Expense) |
|
|
- |
|
|
|
4,914,285 |
|
|
|
(1,298,101 |
) |
|
|
3,616,184 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
Income (Loss) |
|
$ |
(404,661 |
) |
|
$ |
3,742,358 |
|
|
$ |
(4,244,427 |
) |
|
$ |
(906,730 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total
Assets at June 30, 2017 |
|
$ |
7,104,469 |
|
|
$ |
60,224,138 |
|
|
$ |
9,550,062 |
|
|
$ |
76,878,669 |
|
| |
|
For
the Six Months Ended June 30, 2018
(Unaudited)
|
|
| |
|
Herbs
and Produce Products |
|
|
Cannabis
Dispensary, Cultivation and Production |
|
|
Eliminations
and Other |
|
|
Total |
|
| Total
Revenues |
|
$ |
2,786,690 |
|
|
$ |
14,518,525 |
|
|
$ |
28,328 |
|
|
$ |
17,333,543 |
|
| Cost
of Goods Sold |
|
|
2,221,811 |
|
|
|
11,255,869 |
|
|
|
- |
|
|
|
13,477,680 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross Profit |
|
|
564,879 |
|
|
|
3,262,656 |
|
|
|
28,328 |
|
|
|
3,855,863 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Selling,
General and Administrative Expenses |
|
|
1,937,273 |
|
|
|
6,827,231 |
|
|
|
7,660,414 |
|
|
|
16,424,918 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loss
from Operations |
|
|
(1,372,394 |
) |
|
|
(3,564,575 |
) |
|
|
(7,632,086 |
) |
|
|
(12,569,055 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other
Income (Expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amortization of
Debt Discount |
|
|
- |
|
|
|
- |
|
|
|
(885,680 |
) |
|
|
(885,680 |
) |
| Loss on Extinguishment
of Debt |
|
|
- |
|
|
|
- |
|
|
|
(7,858,723 |
) |
|
|
(7,858,723 |
) |
| Gain on Fair Market
Valuation of Derivatives |
|
|
- |
|
|
|
- |
|
|
|
628,000 |
|
|
|
628,000 |
|
| Interest Expense |
|
|
- |
|
|
|
(397 |
) |
|
|
(590,603 |
) |
|
|
(591,000 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Other Income
(Expense) |
|
|
- |
|
|
|
(397 |
) |
|
|
(8,707,006 |
) |
|
|
(8,707,403 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
Loss |
|
$ |
(1,372,394 |
) |
|
$ |
(3,564,972 |
) |
|
$ |
(16,339,092 |
) |
|
$ |
(21,276,458 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total
Assets at June 30, 2018 |
|
$ |
6,320,906 |
|
|
$ |
71,591,669 |
|
|
$ |
31,878,438 |
|
|
$ |
109,791,013 |
|
| |
|
For
the Six Months Ended June 30, 2017
(Unaudited)
|
|
| |
|
Herbs
and Produce Products |
|
|
Cannabis
Dispensary, Cultivation and Production |
|
|
Eliminations
and Other |
|
|
Total |
|
| Total
Revenues |
|
$ |
2,694,210 |
|
|
$ |
11,936,357 |
|
|
$ |
36,762 |
|
|
$ |
14,667,329 |
|
| Cost
of Goods Sold |
|
|
2,295,544 |
|
|
|
10,506,349 |
|
|
|
- |
|
|
|
12,801,893 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross Profit |
|
|
398,666 |
|
|
|
1,430,008 |
|
|
|
36,762 |
|
|
|
1,865,436 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Selling,
General and Administrative Expenses |
|
|
1,515,062 |
|
|
|
4,837,480 |
|
|
|
6,063,045 |
|
|
|
12,415,587 |
|
| |
|
|
|
|
|
|
|
|
|
. |
|
|
|
|
|
| Loss
from Operations |
|
|
(1,116,396 |
) |
|
|
(3,407,472 |
) |
|
|
(6,026,283 |
) |
|
|
(10,550,151 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other
Income (Expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amortization of
Debt Discount |
|
|
- |
|
|
|
- |
|
|
|
(1,126,270 |
) |
|
|
(1,126,270 |
) |
| Loss on Extinguishment
of Debt |
|
|
- |
|
|
|
- |
|
|
|
(2,678,595 |
) |
|
|
(2,678,595 |
) |
| Gain on Fair Market
Valuation of Derivatives |
|
|
- |
|
|
|
- |
|
|
|
2,597,950 |
|
|
|
2,597,950 |
|
| Interest Expense |
|
|
- |
|
|
|
- |
|
|
|
(288,343 |
) |
|
|
(288,343 |
) |
| Loss on Fair Market
Valuation of Contingent Consideration |
|
|
- |
|
|
|
(4,426,047 |
) |
|
|
- |
|
|
|
(4,426,047 |
) |
| Gain on Settlement
of Contingent Consideration |
|
|
- |
|
|
|
4,991,571 |
|
|
|
- |
|
|
|
4,991,571 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Other Income
(Expense) |
|
|
- |
|
|
|
565,524 |
|
|
|
(1,495,258 |
) |
|
|
(929,734 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
Loss |
|
$ |
(1,116,396 |
) |
|
$ |
(2,841,948 |
) |
|
$ |
(7,521,541 |
) |
|
$ |
(11,479,885 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total
Assets at June 30, 2017 |
|
$ |
7,104,469 |
|
|
$ |
60,224,138 |
|
|
$ |
9,550,062 |
|
|
$ |
76,878,669 |
|
|