STOCK TITAN

22nd Century Group Reports Fourth Quarter and Full Year 2024 Financial Results 

Rhea-AI Impact
(Moderate)
Rhea-AI Sentiment
(Negative)
Tags

22nd Century Group (XXII) reported Q4 and full-year 2024 financial results, showing declining performance with net revenues decreasing to $4.0 million from $5.9 million in Q3 2024. The company posted a gross loss of $(1.3) million and increased net loss to $4.2 million.

Key developments include launching new VLN® branding for Q2 2025 shipment and announcing partnership with Smoker Friendly. The company signed a five-year expanded license and manufacturing agreement covering 11 existing products and eight new premium products.

Q4 2024 breakdown shows cigarette revenues at $3.3 million (228,000 cartons), filtered cigars at $0.8 million, and negligible cigarillo distribution revenue. VLN® cigarette revenue was $(0.1) million due to rebates and marketing incentives.

The company ended fiscal 2024 with $3.3 million in net debt and is implementing a new growth strategy for 2025, focusing on profitable contract manufacturing and relaunching reduced nicotine VLN® cigarette business through both branded and private label partner products.

22nd Century Group (XXII) ha riportato i risultati finanziari del quarto trimestre e dell'intero anno 2024, evidenziando una performance in calo, con ricavi netti che sono scesi a 4,0 milioni di dollari rispetto ai 5,9 milioni del terzo trimestre 2024. L'azienda ha registrato una perdita lorda di $(1,3) milioni e un aumento della perdita netta a 4,2 milioni di dollari.

Tra i principali sviluppi vi è il lancio del nuovo marchio VLN® per le spedizioni del secondo trimestre 2025 e l'annuncio di una partnership con Smoker Friendly. L'azienda ha firmato un accordo di licenza e produzione espanso della durata di cinque anni che copre 11 prodotti esistenti e otto nuovi prodotti premium.

La suddivisione del quarto trimestre 2024 mostra ricavi da sigarette a 3,3 milioni di dollari (228.000 cartoni), sigari filtrati a 0,8 milioni di dollari e ricavi di distribuzione di cigarillo trascurabili. I ricavi delle sigarette VLN® sono stati di $(0,1) milioni a causa di rimborsi e incentivi di marketing.

L'azienda ha concluso l'anno fiscale 2024 con 3,3 milioni di dollari di debito netto e sta implementando una nuova strategia di crescita per il 2025, concentrandosi su una produzione contrattuale redditizia e rilanciando l'attività delle sigarette VLN® a ridotto contenuto di nicotina attraverso prodotti sia a marchio che a marchio privato.

22nd Century Group (XXII) informó los resultados financieros del cuarto trimestre y del año completo 2024, mostrando un rendimiento en declive con ingresos netos que disminuyeron a 4,0 millones de dólares desde 5,9 millones en el tercer trimestre de 2024. La compañía reportó una pérdida bruta de $(1,3) millones y un aumento de la pérdida neta a 4,2 millones de dólares.

Los desarrollos clave incluyen el lanzamiento de la nueva marca VLN® para el envío del segundo trimestre de 2025 y el anuncio de una asociación con Smoker Friendly. La empresa firmó un acuerdo de licencia y fabricación ampliado por cinco años que abarca 11 productos existentes y ocho nuevos productos premium.

El desglose del cuarto trimestre de 2024 muestra ingresos por cigarrillos de 3,3 millones de dólares (228,000 cartones), cigarros filtrados por 0,8 millones de dólares y ingresos de distribución de cigarillos insignificantes. Los ingresos por cigarrillos VLN® fueron de $(0,1) millones debido a reembolsos e incentivos de marketing.

La compañía finalizó el año fiscal 2024 con 3,3 millones de dólares en deuda neta y está implementando una nueva estrategia de crecimiento para 2025, enfocándose en la fabricación por contrato rentable y relanzando el negocio de cigarrillos VLN® con bajo contenido de nicotina a través de productos de marca y de marca privada.

22nd Century Group (XXII)는 2024년 4분기 및 연간 재무 결과를 발표하며, 2024년 3분기 5.9백만 달러에서 4.0백만 달러로 감소한 순매출을 보여주며 성과가 감소하고 있음을 알렸습니다. 회사는 $(1.3)백만 달러의 총 손실을 기록했으며, 순손실은 4.2백만 달러로 증가했습니다.

주요 개발 사항으로는 2025년 2분기 배송을 위한 새로운 VLN® 브랜드 출시와 Smoker Friendly와의 파트너십 발표가 포함됩니다. 회사는 11개의 기존 제품과 8개의 새로운 프리미엄 제품을 포함하는 5년의 확장된 라이센스 및 제조 계약을 체결했습니다.

2024년 4분기 세부 사항에 따르면, 담배 수익은 3.3백만 달러(228,000 상자), 필터가 있는 시가 수익은 0.8백만 달러, 시가릴로 배급 수익은 미미합니다. VLN® 담배 수익은 리베이트 및 마케팅 인센티브로 인해 $(0.1)백만 달러였습니다.

회사는 2024 회계연도를 3.3백만 달러의 순부채로 마감했으며, 2025년을 위한 새로운 성장 전략을 구현하고 있으며, 수익성 있는 계약 제조와 브랜드 및 프라이빗 라벨 파트너 제품을 통한 저니코틴 VLN® 담배 사업의 재출시를 중심으로 하고 있습니다.

22nd Century Group (XXII) a publié les résultats financiers du quatrième trimestre et de l'année entière 2024, montrant une performance en déclin avec des revenus nets diminuant à 4,0 millions de dollars contre 5,9 millions au troisième trimestre 2024. L'entreprise a enregistré une perte brute de $(1,3) millions et une perte nette augmentée à 4,2 millions de dollars.

Les développements clés incluent le lancement de la nouvelle marque VLN® pour les expéditions du deuxième trimestre 2025 et l'annonce d'un partenariat avec Smoker Friendly. L'entreprise a signé un accord de licence et de fabrication élargi de cinq ans couvrant 11 produits existants et huit nouveaux produits premium.

La répartition du quatrième trimestre 2024 montre des revenus de cigarettes de 3,3 millions de dollars (228 000 cartons), des cigares filtrés à 0,8 million de dollars et des revenus de distribution de cigarillos négligeables. Les revenus des cigarettes VLN® étaient de $(0,1) million en raison de remises et d'incitations marketing.

L'entreprise a terminé l'exercice 2024 avec 3,3 millions de dollars de dette nette et met en œuvre une nouvelle stratégie de croissance pour 2025, axée sur la fabrication sous contrat rentable et le relancement de l'activité des cigarettes VLN® à faible teneur en nicotine à travers des produits de marque et de marque privée.

22nd Century Group (XXII) hat die finanziellen Ergebnisse für das vierte Quartal und das Gesamtjahr 2024 veröffentlicht, die eine rückläufige Leistung zeigen, wobei die Nettoumsätze auf 4,0 Millionen Dollar von 5,9 Millionen im dritten Quartal 2024 gesunken sind. Das Unternehmen verzeichnete einen Bruttoverlust von $(1,3) Millionen und einen Anstieg des Nettoverlusts auf 4,2 Millionen Dollar.

Zu den wichtigsten Entwicklungen gehört die Einführung der neuen VLN®-Marke für den Versand im zweiten Quartal 2025 und die Ankündigung einer Partnerschaft mit Smoker Friendly. Das Unternehmen hat einen fünfjährigen erweiterten Lizenz- und Herstellungsvertrag für 11 bestehende Produkte und acht neue Premiumprodukte unterzeichnet.

Die Aufschlüsselung des vierten Quartals 2024 zeigt Zigaretteneinnahmen von 3,3 Millionen Dollar (228.000 Kartons), gefilterte Zigarren von 0,8 Millionen Dollar und vernachlässigbare Einnahmen aus Cigarillo-Vertrieb. Die Einnahmen aus VLN®-Zigaretten betrugen $(0,1) Millionen aufgrund von Rabatten und Marketinganreizen.

Das Unternehmen beendete das Geschäftsjahr 2024 mit 3,3 Millionen Dollar Nettoverschuldung und implementiert eine neue Wachstumsstrategie für 2025, die sich auf profitable Vertragsfertigung und die Wiederbelebung des Geschäfts mit VLN®-Zigaretten mit reduziertem Nikotingehalt konzentriert, sowohl über Marken- als auch über Eigenmarkenprodukte.

Positive
  • Increased cigarette carton volumes to 228,000 in Q4 from 156,000 in Q3 2024
  • Secured new five-year manufacturing agreement with Smoker Friendly
  • VLN® products comply with FDA's proposed new tobacco product standard for nicotine yield
Negative
  • Net revenues declined to $4.0M from $5.9M in Q3 2024
  • Increased net loss to $4.2M from $3.6M in Q3 2024
  • Gross loss widened to $1.3M from $0.6M in Q3 2024
  • VLN® cigarette revenue negative at $(0.1M) due to rebates and incentives

Insights

22nd Century's Q4 2024 results reveal deteriorating financial metrics with revenue declining to $4.0 million from $5.9 million sequentially, alongside widening losses. Gross profit deteriorated to a loss of $1.3 million, with operating losses expanding to $4.1 million and net losses increasing to $4.2 million. The company closed 2024 with $3.3 million in net debt.

The performance breakdown across product lines shows broad weakness: cigarette revenues fell to $3.3 million from $4.1 million, filtered cigars dropped to $0.8 million from $1.7 million, and VLN® cigarettes posted negative revenue of $(0.1) million due to rebates and incentives.

While the cigarette carton volumes increased to 228 thousand from 156 thousand, the revenue decline indicates significant pricing pressure and an unfavorable product mix shift between domestic and export sales. The filtered cigar decline stems from the completion of terminated manufacturing agreements without immediate replacement revenue.

The company's 2025 strategy hinges on the relaunch of its VLN® reduced nicotine cigarettes and new partner brand arrangements, with Smoker Friendly being the first announced partner. A new five-year manufacturing agreement with Smoker Friendly covers 11 existing products and 8 new premium products, providing some revenue stability if executed successfully.

Management characterizes 2024 as a "challenging but transformative year" focused on turnaround efforts. Their claim that contract manufacturing begins 2025 with "profitable contracts" represents a critical pivot point that requires verification in upcoming quarters.

22nd Century's reduced nicotine VLN® cigarettes represent a unique position in the tobacco regulatory landscape. The company's announcement that VLN® complies with the FDA's proposed tobacco product standard for nicotine yield (maximum nicotine level of 0.7 mg/g) could become a significant competitive advantage if these regulations are enacted.

The company's strategy shift toward both branded and private label partner VLN® products signals a multifaceted approach to market penetration. The Smoker Friendly partnership, covering both manufacturing agreements and VLN® distribution, leverages an established retail network for its reduced nicotine products.

However, the $(0.1) million negative revenue for VLN® in Q4 raises concerns about the existing market reception. The rebates and marketing incentives for already-distributed product suggest the current VLN® iteration isn't gaining traction without significant promotional support.

The upcoming rebranding in Q2 2025 with "new logo, packaging and marketing plan" represents a tacit acknowledgment that the current product positioning isn't resonating with consumers. While reduced nicotine cigarettes offer harm reduction potential, consumer adoption remains the critical challenge.

The strategic pivot toward partner brands may prove prudent as it diversifies distribution channels and potentially splits marketing costs. If additional partner agreements materialize as suggested, this could create multiple avenues for VLN® technology adoption while spreading risk.

22nd Century's focus on compliance with potential FDA regulations could position the company advantageously if regulatory tailwinds develop, but near-term financial performance indicates the market hasn't yet embraced reduced nicotine products sufficiently to offset declining conventional tobacco revenue.

Launches 2025 Growth Strategy Leveraging Both Internal and External Brand Assets Across Multiple Categories 

Announces First VLN® Partner Brands with Smoker Friendly Ready for Shipment in Q2 2025, Additional Partner VLN® Brands in Discussion

MOCKSVILLE, N.C., March 20, 2025 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), a tobacco products company that is leading the fight against nicotine dependence and believes smokers should have a choice about their nicotine consumption, today announced results for the fourth quarter and year-ended December 31, 2024, and provided an update on recent business highlights.

Fourth Quarter and Full Year 2024 Financial Results (compared to Third Quarter 2024, except as noted)

All figures reported below reflect continuing operations, excluding discontinued operations related to the sale and exit of the Company’s hemp/cannabis business in late 2023.

  • Net revenues decreased sequentially to $4.0 million, compared to $5.9 million.
  • Gross profit (loss) was $(1.3) million, compared to $(0.6) million.
  • Operating loss increased to $4.1 million, compared to $3.4 million.
  • Net loss increased to $4.2 million, compared to $3.6 million.
  • Adjusted EBITDA loss was $3.9 million, from a loss of $3.2 million.
  • Ended fiscal 2024 with net debt of $3.3 million.

Recent Business Highlights

  • Launched new VLN® branding, ready for shipment in the second quarter 2025, including a new logo, packaging and marketing plan.
  • Announced first VLN® partner brand with Smoker Friendly, ready for shipment in the second quarter of 2025.
  • Progressed in securing additional VLN® partner brands, working toward a new reduced nicotine content product category.
  • Signed a new five-year expanded license and manufacturing agreement with Smoker Friendly, covering 11 existing products and eight new premium products to be launched.
  • Announced compliance with the FDA’s proposed new tobacco product standard for nicotine yield, which cites VLN® from 22nd Century as the only combustible cigarette on the market that currently meets the new standard of a maximum nicotine level of 0.7 mg/g in cigarettes.

“Our 2024 results demonstrate a challenging but transformative year as we worked our turnaround plan and reset almost all aspects of our business. We are starting 2025 with a new base focused on growth across all of our revenue lines. Our contract manufacturing business begins the year with profitable contracts, and we have begun the relaunch of our reduced nicotine VLN® cigarette business that will encompass both our branded VLN® products as well as private label partner VLN® products,” said Larry Firestone, Chairman and CEO. “We are excited for 2025 as this is really a new start of 22nd Century Group, Inc., and are looking forward to shaping our future around our current strategy.”

Fourth Quarter 2024 - Discussion of Product Line Net Revenues

  • Cigarette net revenues were $3.3 million, decreased from $4.1 million in the third quarter of 2024 reflecting a shift in overall product mix and pricing between domestic and export sales. Q4 2024 cigarette carton volumes increased to 228 thousand compared to 156 thousand in the third quarter of 2024.
  • Filtered cigars net revenues decreased to $0.8 million, compared to $1.7 million in the immediately preceding quarter, reflecting lower volumes as the Company completed last time buy orders under terminated contract manufacturing agreements.
  • Cigarillo distribution net revenues were negligible in the fourth quarter compared to $0.2 million in the preceding quarter.
  • VLN® cigarette net revenues were $(0.1) million in the fourth quarter, reflective of rebate and marketing incentives for product already in distribution. The Company has announced new branding for its VLN® products, which will be ready for shipment in the second quarter 2025, as well as its first partner brand VLN® products with its existing customer Smoker Friendly. Additional partner brand agreements are in progress as part of a relaunch of its VLN® reduced nicotine content products.

Conference Call

22nd Century will host a live webcast today at 8:00 a.m. E.T. to discuss its fourth quarter and year-end 2024 financial results and business highlights. The live and archived webcast will be accessible in the Events section on 22nd Century’s Investor Relations website at https://ir.xxiicentury.com/events.

Summary Financial Results

(dollars in thousands, except per share data)

  Three Months Ended 
  December 31,  Change 
  2024  2023  $  % 
Revenues, net $4,020  $7,357   (3,337)  (45.4)
Gross profit (loss) $(1,254) $(7,829)  6,575   (84.0)
Operating loss $(4,091) $(14,232)  10,141   (71.3)
Net loss from continuing operations $(4,246) $(22,068)  17,822   (80.8)
Basic and diluted loss per common share from continuing operations $(10.59) $(1,413.40)  1,403   (99.3)
Adjusted EBITDA (a) $(3,888) $(4,363)  475   10.9 


  Year Ended
  December 31,  Change
  2024  2023  $%
Revenues, net $ 24,382  $ 32,204   (7,822) (24.3)
Gross profit (loss) $ (2,400) $ (8,696)  6,296  (72.4)
Operating loss $ (13,950) $ (44,931)  30,981  (69.0)
Net loss from continuing operations $ (15,495) $ (54,686)  39,191  (71.7)
Basic and diluted loss per common share from continuing operations $ (105.85) $ (5,776.63)  5,671  (98.2)
Adjusted EBITDA (a) $ (13,136) $ (30,100)  16,964  56.4 
(a) Adjusted EBITDA is a non-GAAP financial measure. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures. Refer to Tables A at the end of this release for reconciliations of adjusted amounts to the closest corresponding GAAP financial measures.


Summary Product Line Results

(in thousands)

  Three Months Ended 
  December 31,       
  2024  2023  Change 
  $  Cartons  $  Cartons  $  Cartons 
Contract Manufacturing                        
Cigarettes  3,276   228   2,293   104   983   124 
Filtered Cigars  833   112   4,826   715   (3,993)  (603)
Cigarillos  -   -   -   -   -   - 
Total Contract Manufacturing  4,109   340   7,119   819   (3,010)  (479)
VLN®  (89)  (2)  238   4   (327)  (6)
Total Product Line Revenues  4,020   338   7,357   823   (3,337)  (485)


  Year Ended 
  December 31,       
  2024  2023  Change 
  $  Cartons  $  Cartons  $  Cartons 
Contract Manufacturing                        
Cigarettes  14,219   644   14,027   745   192   (101)
Filtered Cigars  9,427   1,361   17,240   2,652   (7,813)  (1,291)
Cigarillos  756   120   -   -   756   120 
Total Contract Manufacturing  24,402   2,125   31,267   3,397   (6,865)  (1,272)
VLN®  (20)  -   937   18   (957)  (18)
Total Product Line Revenues  24,382   2,125   32,204   3,415   (7,822)  (1,290)


About 22nd Century Group, Inc.

22nd Century Group is the pioneering nicotine harm reduction company in the tobacco industry enabling smokers to take control of their nicotine consumption.

We created our flagship product, the VLN® cigarette, to give traditional cigarette smokers an authentic and familiar alternative that helps them take control of their nicotine consumption. VLN® cigarettes have 95% less nicotine than the traditional cigarette and have been proven to greatly reduce nicotine consumption. Instead of offering new ways of delivering nicotine to addicted smokers, we offer smokers the option to take control of their nicotine consumption and make informed and more productive choices, including the choice to avoid addictive levels of nicotine altogether.

Our wholly owned subsidiaries include a leading cigarette manufacturer that produces all VLN® products and provides turnkey contract manufacturing for other tobacco brands both domestically and internationally. The 60,000 square foot facility in Mocksville, North Carolina has the capacity to produce more than 45 million cartons of combusted tobacco products annually with additional space for expansion.

Our proprietary reduced nicotine tobacco blends are made possible by comprehensive and patented technologies that regulate nicotine biosynthesis activities in the tobacco plant, resulting in full flavor and high yield with 95% less nicotine. Our extensive patent portfolio has been developed to ensure we have the only low nicotine combustible cigarette in the United States and critical international markets. Our mission is to sell the last cigarette before the 22nd Century.

VLN® and Helps You Smoke Less® are registered trademarks of 22nd Century Limited LLC.

Learn more at xxiicentury.com, on X (formerly Twitter), on LinkedIn, and on YouTube.

Learn more about VLN® at tryvln.com.

Cautionary Note Regarding Forward-Looking Statements

Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements, including but not limited to our full year business outlook. Forward-looking statements typically contain terms such as “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “foresee,” “goal,” “guidance,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “preliminary,” “probable,” “project,” “promising,” “seek,” “should,” “will,” “would,” and similar expressions. Forward-looking statements include, but are not limited to, statements regarding (i) our cost reduction initiatives, (ii) our expectations regarding regulatory enforcement, including our ability to receive an exemption from new regulations, (iii) our financial and operating performance and (iv) our expectations for our business interruption insurance claim. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in “Risk Factors” in the Company’s Annual Report on Form 10-K filed on March 20, 2025. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law.

Notes regarding Non-GAAP Financial Information

In addition to the Company’s reported results in accordance with generally accepted accounting principles in the United States of America (“GAAP”), the Company provides EBITDA and Adjusted EBITDA.

In order to calculate EBITDA, the Company adjusts net (loss) income by adding back interest expense (income), provision (benefit) for income taxes, and depreciation and amortization expense. Adjusted EBITDA consists of EBITDA adjusted by the Company for certain non-cash and/or non-operating expenses, including adding back equity-based employee compensation expense, restructuring and restructuring-related charges such as impairment, acquisition and transaction costs, and other unusual or infrequently occurring items, if applicable, such as inventory reserves and adjustments, gains or losses on disposal of property, plant and equipment, and gains or losses on investments.

The Company believes that the presentation of EBITDA and Adjusted EBITDA are important financial measures that supplement discussion and analysis of its financial condition and results of operations and enhances an understanding of its operating performance. While management considers EBITDA and Adjusted EBITDA to be important, these financial performance measures should be considered in addition to, but not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP, such as operating (loss) income, net (loss) income and cash flows from operations. Adjusted EBITDA is susceptible to varying calculations and the Company’s measurement of Adjusted EBITDA may not be comparable to those of other companies.

Net total debt is calculated as total principal amount of debt outstanding less cash and cash equivalents. In addition to the performance measures identified above, we believe that net total debt provides a meaningful measure of liquidity and a useful basis for assessing our ability to fund our activities, including the financing of scheduled debt repayments.

Investor Relations & Media Contact
Matt Kreps
Investor Relations
22nd Century Group
mkreps@xxiicentury.com
214-597-8200

22nd CENTURY GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(amounts in thousands, except share and per-share data)

  December 31,  December 31, 
  2024  2023 
ASSETS        
Current assets:        
Cash and cash equivalents $4,422  $2,058 
Accounts receivable, net  1,698   1,671 
Inventories  2,015   4,346 
Insurance recoveries  768   3,768 
GVB promissory note  500   2,000 
Prepaid expenses and other current assets  1,068   1,180 
Current assets of discontinued operations held for sale  1,051   1,254 
Total current assets  11,522   16,277 
Property, plant and equipment, net  2,773   3,393 
Operating lease right-of-use assets, net  1,639   1,894 
Intangible assets, net  5,724   5,924 
Other assets  15   15 
Total assets $21,673  $27,503 
         
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)        
Current liabilities:        
Notes and loans payable - current $254  $543 
Current portion of long-term debt  1,500   5,848 
Operating lease obligations  261   231 
Accounts payable  2,401   4,445 
Accrued expenses  1,021   1,322 
Accrued litigation  768   3,768 
Accrued payroll  318   883 
Accrued excise taxes and fees  2,038   2,234 
Deferred income  20   726 
Other current liabilities  100   1,849 
Current liabilities of discontinued operations held for sale  1,281   3,185 
Total current liabilities  9,962   25,034 
Long-term liabilities:        
Operating lease obligations  1,437   1,698 
Long-term debt  5,165   8,058 
Other long-term liabilities  1,097   1,123 
Total liabilities  17,661   35,913 
Shareholders' equity (deficit)        
Preferred stock, $.00001 par value, 10,000,000 shares authorized        
Common stock, $.00001 par value, 250,000,000 shares authorized        
Capital stock issued and outstanding:        
730,148 common shares (20,313 at December 31, 2023)        
Common stock, par value      
Capital in excess of par value  397,883   370,297 
Accumulated deficit  (393,871)  (378,707)
Total shareholders' equity (deficit)  4,012   (8,410)
Total liabilities and shareholders’ equity (deficit) $21,673  $27,503 


22nd CENTURY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
(amounts in thousands, except share and per-share data)

  Year Ended 
  December 31, 
  2024  2023 
Revenues, net $24,382  $32,204 
Cost of goods sold  14,278   24,891 
Excise taxes and fees on products  12,504   16,009 
Gross (loss) profit  (2,400)  (8,696)
Operating expenses:        
Sales, general and administrative  10,287   31,064 
Research and development  1,133   2,644 
Other operating expense, net  130   2,527 
Total operating expenses  11,550   36,235 
Operating loss from continuing operations  (13,950)  (44,931)
Other income (expense):        
Other income (expense), net  507   334 
Loss on transfer of promissory note     (895)
Interest income, net  72   219 
Interest expense  (2,094)  (9,366)
Total other income (expense), net  (1,515)  (9,708)
Loss from continuing operations before income taxes  (15,465)  (54,639)
Provision for income taxes  30   47 
Net loss from continuing operations $(15,495) $(54,686)
         
Discontinued operations:        
Income (loss) from discontinued operations before income taxes $331  $(85,634)
Provision for income taxes     455 
Net income (loss) from discontinued operations $331  $(86,089)
         
Net loss $(15,164) $(140,775)
Deemed dividends  (10,303)  (9,992)
Net loss available to common shareholders $(25,467) $(150,767)
         
Basic loss per share:        
Basic loss per common share from continuing operations $(105.85) $(5,776.63)
Basic income (loss) per common share from discontinued operations $2.26  $(9,093.89)
Basic loss per common share from deemed dividends $(70.38) $(1,055.47)
Basic loss per common share $(173.97) $(15,925.99)
         
Diluted loss per share:        
Diluted loss per common share from continuing operations $(105.85) $(5,776.63)
Diluted income (loss) per common share from discontinued operations $0.24  $(9,093.89)
Diluted loss per common share from deemed dividends $(70.38) $(1,055.47)
Diluted loss per common share $(175.99) $(15,925.99)
         
Weighted average shares outstanding:        
Basic  146,392   9,467 
Diluted  1,389,983   9,467 


Table A – Reconciliations of Non-GAAP Measures

(dollars in thousands, except share and per-share data)

Below is a table containing information relating to the Company’s Net loss, EBITDA and Adjusted EBITDA for the three and nine month periods ended December 31, 2024 and 2023, including a reconciliation of these Non-GAAP measures for such periods.

  Quarter Ended 
  December 31, 
  Amounts in thousands ($000's) 
  except share and per share data 
  (UNAUDITED) 
        $ Change 
  2024  2023  fav / (unfav)1 
Net loss from continuing operations $(4,246) $(22,068) $17,822 
Interest (income)/expense, net  221   6,769   (6,548)
Provision (benefit) for income taxes  3   1   2 
Amortization and depreciation  241   370   (129)
EBITDA $(3,781) $(14,928) $11,147 
Adjustments:            
Restructuring and impairment  (111)  1,871   (1,982)
Inventory write-down     7,927   (7,927)
Change in fair value of derivative liabilities  (75)  557   (632)
Change in fair value of warrant liabilities  (68)  175   (243)
Loss on transfer of promissory note     895   (895)
Equity-based employee compensation expense  147   (860)  1,007 
Adjusted EBITDA $(3,888) $(4,363) $475 
             
Adjusted EBITDA loss per common share $(9.70) $(279.44) $269.74 
Weighted average common shares outstanding - basic and diluted  400,858   15,613     


  Year Ended 
  December 31, 
  Amounts in thousands ($000's) 
  except share and per share data 
  (UNAUDITED) 
        $ Change 
  2024  2023  fav / (unfav)1 
Net loss from continuing operations $(15,495) $(54,686) $39,191 
Interest (income)/expense, net  2,022   9,147   (7,125)
Provision (benefit) for income taxes  30   47   (17)
Amortization and depreciation  1,003   1,508   (505)
EBITDA $(12,440) $(43,984) $31,544 
Adjustments:            
Restructuring and impairment  (459)  2,415   (2,874)
Inventory write-down  431   7,927   (7,496)
Acquisition and transaction costs     223   (223)
Change in fair value of derivative liabilities  (556)  557   (1,113)
Change in fair value of warrant liabilities  (492)  (364)  (128)
Loss on transfer of promissory note     895   (895)
Equity-based employee compensation expense  380   2,231   (1,851)
Adjusted EBITDA $(13,136) $(30,100) $16,964 
             
Adjusted EBITDA loss per common share $(0.09) $(3.18) $3.09 
Weighted average common shares outstanding - basic and diluted  146,392   9,467     


1
Fav = Favorable variance, which increases EBITDA and Adjusted EBITDA; Unfav = unfavorable variance, which reduces EBITDA and Adjusted EBITDA

Table B: Net Total Debt Reconciliation
(dollars in thousands)

  December 31,  December 31, 
  2024  2023 
Total debt $6,665  $13,906 
Add: debt discounts and deferred issuance costs included in total debt  1,025   1,453 
Total principal amount of debt outstanding  7,690   15,359 
Less: Cash and cash equivalents  4,422   2,058 
Net total debt (Non-GAAP) $3,268  $13,301 

FAQ

What were XXII's Q4 2024 financial results?

Q4 2024 showed net revenues of $4.0 million, gross loss of $1.3 million, and net loss of $4.2 million, with cigarette revenues at $3.3 million.

When will XXII launch its new VLN® branded products?

The new VLN® branded products are scheduled for shipment in the second quarter of 2025.

What is the scope of XXII's new agreement with Smoker Friendly?

A five-year expanded license and manufacturing agreement covering 11 existing products and eight new premium products.

How many cigarette cartons did XXII sell in Q4 2024?

XXII sold 228,000 cigarette cartons in Q4 2024, up from 156,000 in Q3 2024.

What is XXII's current debt position?

The company ended fiscal 2024 with net debt of $3.3 million.
22Nd Century

NASDAQ:XXII

XXII Rankings

XXII Latest News

XXII Stock Data

2.92M
2.09M
41.08%
10.28%
13.02%
Tobacco
Cigarettes
Link
United States
WILLIAMSVILLE