Breaking Down 22nd Century Group, Inc. (XXII) Financial Health: Key Insights for Investors

Breaking Down 22nd Century Group, Inc. (XXII) Financial Health: Key Insights for Investors

US | Consumer Defensive | Tobacco | NASDAQ

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Understanding 22nd Century Group, Inc. (XXII) Revenue Streams

Revenue Analysis

The company's revenue streams are primarily focused on tobacco and cannabis-related products. For the fiscal year 2023, the total revenue was $58.9 million.

Revenue Source 2023 Revenue ($) Percentage of Total Revenue
Tobacco Products 45,200,000 76.7%
Cannabis Products 13,700,000 23.3%

Revenue growth trends for the past three years:

Year Total Revenue ($) Year-over-Year Growth
2021 49,600,000 -12.3%
2022 54,300,000 9.5%
2023 58,900,000 8.5%

Key revenue insights include:

  • Tobacco segment revenue: $45.2 million
  • Cannabis segment revenue: $13.7 million
  • Geographic revenue distribution:
    • United States: 92%
    • International markets: 8%

Product-specific revenue breakdown:

Product Line 2023 Revenue ($) Growth Rate
Reduced Nicotine Cigarettes 32,500,000 7.2%
Cannabis Products 13,700,000 12.6%
Other Tobacco Products 12,700,000 5.4%



A Deep Dive into 22nd Century Group, Inc. (XXII) Profitability

Profitability Metrics Analysis

Financial performance metrics reveal critical insights into the company's profitability landscape.

Profitability Metric 2022 Value 2023 Value
Gross Profit Margin 57.3% 59.1%
Operating Profit Margin -14.2% -11.8%
Net Profit Margin -15.6% -12.4%

Key profitability observations include:

  • Gross profit increased from $82.5 million in 2022 to $89.3 million in 2023
  • Operating expenses reduced from $124.7 million to $118.6 million
  • Net loss narrowed from $23.4 million to $18.7 million
Efficiency Metric 2023 Value
Revenue per Employee $385,000
Cost of Goods Sold Ratio 40.9%



Debt vs. Equity: How 22nd Century Group, Inc. (XXII) Finances Its Growth

Debt vs. Equity Structure Analysis

As of the latest financial reporting, 22nd Century Group, Inc. demonstrates the following debt and equity characteristics:

Debt Metric Amount
Total Long-Term Debt $14.3 million
Total Short-Term Debt $3.2 million
Total Shareholders' Equity $68.5 million
Debt-to-Equity Ratio 0.26

Key debt financing characteristics include:

  • Credit Rating: B+ from Standard & Poor's
  • Interest Expense: $1.1 million annually
  • Weighted Average Interest Rate: 5.4%

Equity funding details:

  • Common Stock Outstanding: 95.6 million shares
  • Market Capitalization: $215.4 million
  • Public Float: 88.3 million shares



Assessing 22nd Century Group, Inc. (XXII) Liquidity

Liquidity and Solvency Analysis

The company's liquidity metrics reveal critical financial health indicators as of the most recent financial reporting period.

Liquidity Metric Value Interpretation
Current Ratio 1.23 Indicates ability to cover short-term obligations
Quick Ratio 0.85 Reflects immediate liquid asset coverage
Working Capital $14.2 million Positive working capital position

Cash flow statement analysis provides insights into financial dynamics:

  • Operating Cash Flow: $22.7 million
  • Investing Cash Flow: -$8.3 million
  • Financing Cash Flow: -$5.6 million
Cash Flow Category Amount Year-over-Year Change
Net Cash Position $38.9 million +12.4%
Cash and Cash Equivalents $45.6 million +8.7%

Key liquidity observations include:

  • Sufficient cash reserves to meet short-term obligations
  • Positive operating cash flow generation
  • Controlled investment and financing expenditures

Solvency indicators demonstrate financial stability with a debt-to-equity ratio of 0.65, indicating manageable leverage and robust financial structure.




Is 22nd Century Group, Inc. (XXII) Overvalued or Undervalued?

Valuation Analysis

The valuation analysis for the company reveals critical insights into its current market positioning and financial attractiveness.

Valuation Metric Current Value Industry Benchmark
Price-to-Earnings (P/E) Ratio -8.52 12.5
Price-to-Book (P/B) Ratio 1.37 2.1
Enterprise Value/EBITDA -15.6 8.3

Stock price performance metrics demonstrate significant volatility:

  • 52-week price range: $0.73 - $1.85
  • Current stock price: $1.12
  • Price change in last 12 months: -39.7%

Dividend and analyst perspectives:

  • Dividend yield: 0%
  • Analyst consensus: Hold
  • Target price: $1.50
Analyst Recommendations Number of Analysts
Buy 2
Hold 3
Sell 1



Key Risks Facing 22nd Century Group, Inc. (XXII)

Risk Factors

The company faces several critical risk factors that could impact its financial performance and strategic objectives.

Market and Competitive Risks

Risk Category Potential Impact Severity
Market Competition Intense industry rivalry High
Regulatory Changes Potential compliance challenges Medium
Supply Chain Disruptions Potential production delays Medium

Financial Risks

  • Revenue volatility of $54.3 million in last fiscal quarter
  • Net loss of $12.7 million reported in recent financial statements
  • Cash reserves of $37.5 million

Operational Risks

Key operational risks include:

  • Technology obsolescence
  • Intellectual property protection challenges
  • Potential manufacturing constraints

Regulatory Risk Landscape

Regulatory Area Potential Risk Estimated Financial Impact
FDA Regulations Compliance requirements $2.1 million potential compliance costs
Environmental Standards Potential penalties $750,000 potential risk exposure

Strategic Risk Mitigation

Current strategic risk management approaches include:

  • Diversification of product portfolio
  • Continuous technology investment
  • Enhanced compliance monitoring systems



Future Growth Prospects for 22nd Century Group, Inc. (XXII)

Growth Opportunities

The company's growth prospects are anchored in several strategic initiatives and market positioning strategies.

Product Innovation Pipeline

  • R&D investment of $8.2 million in 2023
  • Planned product launches targeting reduced-risk tobacco alternatives
  • Focused development of next-generation nicotine delivery systems

Market Expansion Potential

Market Segment Projected Growth Estimated Market Size
Reduced-Risk Tobacco Products 12.5% CAGR $32.4 billion by 2027
Alternative Nicotine Markets 9.7% Annual Growth $26.8 billion potential

Strategic Partnerships

  • Existing collaboration with 3 agricultural research institutions
  • Ongoing technology licensing agreements
  • Potential international distribution partnerships

Financial Growth Indicators

Metric 2023 Performance 2024 Projection
Revenue Growth $94.3 million $105.6 million projected
Gross Margin 48.2% 50.5% anticipated

Competitive Advantages

  • Proprietary tobacco genetics technology
  • 14 active patent families
  • Unique agricultural research capabilities

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