MARLEY COFFEE PERKS UP WITH $2.1M!

 By Steven Jackson—

 Rohan Marley—

MARLEY Coffee, the fast-growing US brand under the chairmanship of Rohan Marley, raised some US$2.1 million in notes in September in a bid to pay down on millions owed to a major distributor.

Earlier this month the company raised money from issuing three separate notes to JSJ Investments Inc, Typenex Co-Investment LLC and JMJ Financial in the amount of $275,000; US$1 million; and up to US$900,000, respectively.

“We recently raised funding through the sale of convertible notes, as described above, to pay down a portion of the amounts we owed to Mother Parkers, provided that in the future we may be required to raise additional debt or equity funding, including in order to repay such convertible notes, which may not be available on favourable terms, if at all,” stated Marley Coffee in its financials released this week to investors.

Mother Parkers Tea & Coffee Inc is a 100-year-old Canadian company that distributes tea, coffee, and other beverages for retailers, brand owners, and companies in North America. In 2010, Mother Parkers became the fourth largest roaster in North America behind Folgers, Maxwell House, and Starbucks, according to its website.

Marley Coffee company indicated that as of July 31, 2015, it owed approximately “US$2 million to Mother Parkers” for distribution services rendered.

“Mother Parkers has previously advised us that if we are not able to pay them amounts due past the 120-day net terms they have provided us, they will not provide additional credit and will stop distributing our products,” stated Marley Coffee, adding that as of July its debt with Mother Parkers remained below 120 days.

The coffee brand uses its distributors to sell its products in more than 7,500 outlets in the US and beyond. In 2014, the company inked a deal with one of the largest independent coffee and tea manufacturers in North America — RealCup brand in Canada. This follows a landmark contract in 2013 to supply Kroger and Safeway — the largest retail stores in the US — with roasted coffee products.

Marley Coffee operates a local and US division under the chairmanship of Rohan Marley, son of late reggae legend Bob Marley. The loss-making company paid its chairman Rohan Marley and his associated company over US$90,000 in total over six months ending July 2015, the company revealed.

“During the six months ended July 31, 2015 and 2014, the company paid Rohan Marley Enterprises and Rohan Marley US$90,909 and US$95,873, respectively, for directors consulting fees,” stated the company about Rohan Marley Enterprises, the personal corporation of Rohan Marley, which he uses to record all of his business transactions.

In the previous quarter the company revealed plans to break even next year. Hitting that target would retard the growth of its US$26.2 million accumulated deficit at the fast-growing coffee company, which aims to double sales to US$20 million for its financial year ending January 2016.

Marley Coffee hopes to be EBITDA-positive in the third and fourth quarters, and show positive EBITDA in its audited results of operations for the year ended January 31, 2016. The good news is that its net loss of US$968,000 in July was roughly two-thirds less than the net loss of US$3 million in the 2014 corresponding quarter.