–Net Income increased 245% year-over-year to approximately $2.0 million in the first quarter of 2024
–Adjusted EBITDA increased 165.3% to approximately $1.1 million(1)
–Operating Expenses decreased 35.8% versus the same period in 2023
GOLDEN, Colo., May 13, 2024 (GLOBE NEWSWIRE) — SHF Holdings, Inc., d/b/a/ Safe Harbor Financial (“Safe Harbor” or the “Company”) (NASDAQ:SHFS), a leader in facilitating financial services and credit facilities to the regulated cannabis industry, announced today its financial results for the first quarter ended March 31, 2024.
First Quarter 2024 Financial & Operational Summary
Net Income increased 245% to approximately $2.0 million, compared to a net loss of approximately $1.4 million in the same period of 2023;
Revenue was approximately $4.1 million, compared to approximately $4.2 million for the first quarter of 2023;
Gross profit was approximately $325,000, versus a gross loss of approximately $1.6 million in the first quarter of 2024;
Operating Expenses decreased 35.8% to $3.7 million, compared to $5.8 million in the first quarter of 2023;
Adjusted EBITDA increased 165.3% to approximately $1.1 million, compared to $410,000 for the first quarter of 2023(1).
(1) Adjusted EBITDA is a non-GAAP financial metric. A reconciliation of non-GAAP to GAAP measures is included below in this earnings release.
“We continued to expand the breadth of our service offering in the first quarter, advancing several strategic initiatives and establishing a more diversified income base,” said Sundie Seefried, Chief Executive Officer of Safe Harbor Financial. “We have been very successful with this effort, specifically within our lending program, nearly tripling our loan book year-over-year and driving a 251% increase in our loan income to $1.64 million in the first quarter of 2024 compared to $466,293 in the comparable period of 2023.”
“These results speak directly to our unique ability to support the unmet financial needs of the cannabis industry, and the continued growth opportunity for Safe Harbor to address the evolving financial requirements of cannabis related businesses (CRB’s) through our streamlined platform. With the increasing likelihood that cannabis will be reclassified from a Schedule I drug to a Schedule III drug, we believe there will be a material increase of capital from these businesses moved into financial institutions, thereby creating stronger demand for our services,” concluded Seefried.
First Quarter 2024 Operational Highlights
On January 4, 2024, the Company announced it originated a $9 Million first lien secured loan for a major, MSO-operated cultivation facility in Denver, Colorado.
On March 12, 2024, Safe Harbor announced it originated a $4.6 Million secured credit facility for a Michigan cannabis operator.
Other Significant Events
On April 15th, 2024, the Company appointed CEO, Sundie Seefried to its Board of Directors.
First Quarter 2024 Financial Results
For the first quarter ended March 31, 2024, total revenue decreased 3% to $4.1 million, compared to $4.2 million in the prior year period, due to fewer accounts and lower balances on deposit versus the prior year period.
First quarter 2024 net income was approximately $2.0 million, compared to a net loss of $1.4 million in the prior year period. The driver of the net income produced in the first quarter 2024 was due to lower expenses across the Company. Overall, operating expenses in the period decreased approximately 35.8% to $3.7 million, compared to $5.8 million in the prior year period.
As of March 31, 2024, the Company had cash and cash equivalents of $5.6 million, compared to $4.9 million at December 31, 2023.
For more information on the Company’s first quarter 2024 financial results, please refer to our Form 10-Q for the quarter ended March 31, 2024 filed with the U.S. Securities & Exchange Commission (the “SEC”) and accessible at www.sec.gov.
SHF Holdings, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, 2024
(Unaudited)
December 31, 2023
ASSETS
Current Assets:
Cash and cash equivalents
$
5,626,362
$
4,888,769
Accounts receivable – trade
153,208
121,875
Accounts receivable – related party
1,111,390
2,095,320
Prepaid expenses – current portion
506,634
546,437
Accrued interest receivable
16,891
13,780
Short-term loans receivable, net
12,620
12,391
Other current assets
–
82,657
Total Current Assets
$
7,427,105
$
7,761,229
Long-term loans receivable, net
379,863
381,463
Property, plant and equipment, net
45,366
84,220
Operating lease right to use assets
820,777
859,861
Goodwill
6,058,000
6,058,000
Intangible assets, net
3,564,890
3,721,745
Deferred tax asset
44,278,374
43,829,019
Prepaid expenses – long term position
525,000
562,500
Forward purchase receivable
4,584,221
4,584,221
Security deposit
18,875
18,651
Total Assets
$
67,702,471
$
67,860,909
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable
$
179,242
$
217,392
Accounts payable-related party
125,693
577,315
Accrued expenses
645,635
1,008,987
Contract liabilities
2,692
21,922
Lease liabilities – current
142,863
132,546
Senior secured promissory note – current portion
3,028,738
3,006,991
Deferred consideration – current portion
2,921,257
2,889,792
Other current liabilities
62,160
41,639
Total Current Liabilities
$
7,108,280
$
7,896,584
Warrant liabilities
2,908,642
4,164,129
Deferred consideration – long term portion
594,000
810,000
Forward purchase derivative liability
7,309,580
7,309,580
Senior secured promissory note—long term portion
10,241,884
11,004,175
Net deferred indemnified loan origination fees
421,907
63,275
Lease liabilities – long term
835,598
875,447
Indemnity liability
1,315,263
1,382,408
Total Liabilities
$
30,735,154
$
33,505,598
Commitment and Contingencies (Note 13)
Stockholders’ Equity
Convertible preferred stock, $.0001 par value, 1,250,000 shares authorized, 111 and 1,101 shares issued and outstanding on March 31, 2024, and December 31, 2023, respectively
–
–
Class A common stock, $.0001 par value, 130,000,000 shares authorized, 55,431,001 and 54,563,372 issued and outstanding on March 31, 2024, and December 31, 2023, respectively
5,545
5,458
Additional paid in capital
107,348,166
105,919,674
Retained deficit
(70,386,394
)
(71,569,821
)
Total Stockholders’ Equity
$
36,967,317
$
34,355,311
Total Liabilities and Stockholders’ Equity
$
67,702,471
$
67,860,909
SHF Holdings, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the three months ended
March 31,
2024
2023
Revenue
$
4,050,799
$
4,180,379
Operating Expenses
Compensation and employee benefits
$
2,280,038
$
3,659,520
General and administrative expenses
984,220
1,538,874
Professional services
460,950
449,246
Rent expense
69,437
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