The shifting attitudes toward medicinal cannabis are as apparent in the news as they are in the progress in the emerging sector.
General Cannabis Inc. (CANA), a pioneer in the field, posted solid gains in the third quarter this year, showing clear progress and significant increases year over year in revenue and profitability. It was good news across the board for General Cannabis, as the company also managed to reduce expenses.
Earnings Report Displays Solid Growth
The news from the Q3 report was good. Revenue for the third quarter was $4.1 million, up 106 percent year-over year-from 2010's Q3 revenue of $2 million. This was paired with news that, in the first nine months of 2011, the company has taken in $10.4 million over last year's $5.5 million. The gains can largely be attributed to the movement in the company's vertical finder website technology, run by WeedMaps Media, General Cannabis' finder site for the medicinal cannabis industry. General Cannabis also saw a year-over-year decrease of 19 percent in operating expenses as a percentage of sales, while also increasing operating income by 463 percent over the same period. Net income was up 473 percent year-over-year to $430,000, up from $75,000 in the same period last year.
"Our strong year-over-year and sequential growth in revenue and EBITDA reflect a solid performance by our broadening technology platform which is leveraged by WeedMaps Media. We continue to increase returns on our investments in our sales and marketing efforts," said Jim Pakulis, CEO of General Cannabis. "We are continuing to manage costs effectively, and with increasing revenue, we are benefiting from significant operating leverage, as evidenced in our EBITDA and operating income."
General Cannabis' Success Part of a Growing Trend
The strong earnings report from General Cannabis could be taken as evidence of a growing trend towards acceptance for the medicinal marijuana field and a sign that their place in the markets is being solidified. As the legal issues swirling around marijuana continue to dissipate, the industry, already almost an estimate $40 billion in size, continues to find itself on firmer footing. As polling shows that more and more Americans are ready to accept medicinal marijuana and even consider the potential for legalization in the future, General Cannabis appears poised to capitalize on a growing market.
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