Last Friday, it was a green closing for Medbox Inc (OTCMKTS:MDBX) after the company filed its first annual report. The share price surged almost 17% to close the session at $1.65 per share. However, the optimism was short-lived as it erased a major part of the gain on Monday’s trading session.

The financials

The company filed its due 10-K form on last Thursday after the market hours. The report contained little that could boost optimism among investors. As per the report, Medbox reported cash of $101,000. The current liabilities stood at $11.5 million. The annual net revenue came at $629,000 whereas the annual net loss widened to $16.5 million. The revenue declined 69% YOY, even when the financial results are compared with the restated results.

The decline

Medbox net loss for FY2014 is staggering at more than $16 million. The general and administrative expenses have surged almost 280%. The report states the costs linked with the company’s latest stock compensation plan amounted to $4.4 million. Also, the expenses increased due to $1 million of additional legal costs incurred due to the SEC and other investigations. The probe was related with the erroneous reports submitted initially by the company.

The reasons

Medbox states that the increase in losses was a result of varying factors. The revenue declined sharply compared to last year. Also, there were additional costs related with being a public company. The rise in interest expenses liked with convertible debentures, financing costs, licenses fees in new market, higher marketing and sales expenses added to the company woes.

The restated results

Few days ago, Medbox Inc (OTCMKTS:MDBX) submitted the restated results for FY2012 and FY2013. As per the previous report of 1Q2014, revenue stood at $331,000 which came at negative $8,000 in restated results. In last trading session, Medbox shares declined more than 7% to close at $1.53.

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Steve Kanaval: Portfolio Manager/Writer/ Market Analyst Steve began his career in the Trading Pits in Chicago making markets at the Chicago Mercantile Exchange (NYSE:CME) the Chicago Board of Trade and the CBOE in the early 80’s. He ran the Morgan Stanley Derivative Prop Trading for the firm specializing in Index Arbitrage. He continued his career as a Trader/Portfolio Manager for multiple Hedge Funds during the Internet Boom of the 90’s managing large portfolios. Steve is known as an expert in MicroCap Technology Stocks and the emerging Digital Currency markets as a Portfolio Manager for his Family Office. Steve has managed portfolio’s in volatile asset classes for 3 decades as a commodity trader, hedge fund manager and digital currency trader and miner. Steve publishes his views on the asset classes in a public forum and has published more than 10,000 articles simplifying these complex and volatile assets for readers. His work is published on multiple sites including Bloomberg,,, CryptoCurrencyNews as a paid contributor. His work includes research, journalism and archived video on important market volatility related to stocks, digital currency and other volatile misunderstood asset classes. He offers a humorous, unique insight and the related back stories and drivers for readers interested in volatility and emerging market assets. Full disclosure Steve is long 25 digital currencies and sits on the board of multiple public companies involved in digital currencies, and owns shares in these companies from time to time.