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Marley Coffee grows revenue but losses to climb

Published:Wednesday | March 11, 2015 | 12:00 AM

A preliminary report on anticipated financial results for Jammin Java Corp, which trades as Marley Coffee Inc, indicates an improvement in annual revenue from US$6 million to US$10 million for the year ended January 31, 2015.

The numbers reflect a 66 per cent improvement in turnover for the company.

The preliminary report said that gross profit for the period tripled from US$700,000 to US$2.4 million year-on-year. But Jammin Java also indicated in the same filing that it anticipates reporting a net loss of US$9.3 million, a worsening of its US$6.7-million loss for year ending January 2014; at the same time, its liabilities have climbed from US$1.9 million to US$2.8 million.

The company's complete financial statements and results are to be filed around May 1, 2015.

Analyst Steven Ralston, in a December online discussion of the company's management strategy, noted that Jammin Java has indicated focus on its international expansion efforts in four key markets: Canada, United Kingdom, Chile and South Korea for fiscal 2016.

"In Canada, Marley Coffee is currently available in 1,900 stores, which is expected to expand to over 2,000 stores by the end of the year, driven by Marley's partnership with Mother Parkers," he said.

In its preliminary report released in February, Jammin Java said that notwithstanding the challenges outlined, Marley Coffee's largest supplier of products recently "verbally agreed to extend the company's required terms of payment from 30 days to 120 days from the date product is received, which will provide the company approximately US$1.5 million of short-term capital in the near term."

Ralston said that the company's e-commerce strategy is designed to directly capitalise on the Marley brand through a subscription coffee service on the Marley Coffee website.

"The launch of a Coffee-of-the-Month subscription service at is imminent. For the last two years, purchase requests have been pushed to partner sites. The natural website traffic is roughly 20,000 unique hits per month, and management expects to capture this potential revenue stream," he said.

Jammin Java last year issued common shares to Ironridge Global Partners and Mother Parkers to settle obligations to those firms.

The company says it intends to secure working capital for the next two years through its operations as well as "future equity offerings".