HempFusion Wellness Inc. (TSX:CBD.U) (OTCQX:CBDHF)
(FWB:8OO) (“HempFusion” or the “Company”), a leading health and
wellness Company offering premium probiotic supplements and
products containing CBD, is pleased to provide a corporate update
and proforma revenue guidance including its two recently completed
acquisitions, APCNA Holdings LLC (“Apothecanna”) and Sagely
Enterprises Inc. (“Sagely Naturals”), (together the “Acquisitions”)
for fiscal 2021 and 2022.
Based on a fiscal 2020 pro forma revenue basis, HempFusion
(combined with the fiscal 2020 revenues of Apothecanna and Sagely
Naturals) would have generated approximately USD$11.8 million in
revenue. With the completion of the Acquisitions and inclusion of
the pre-closing fiscal 2021 revenues of Apothecanna and Sagely
Naturals, HempFusion expects to generate revenues of between
USD$12.5 million and $13.5 million in fiscal 2021 and USD$20
million to $25 million in fiscal 2022 due in large part to the
Company’s expansion plans over the next 18 months and beyond. The
Company maintains a clean balance sheet with approximately USD$11.4
million cash as of the end of the Company’s second fiscal
quarter.
HempFusion’s combined footprint includes the following:
- Distribution to over 15,000 retail locations including Publix,
Walgreens, CVS, Rite Aid, Albertsons, Sprouts, Nordstrom, Whole
Foods, and Kroger, with several more significant retailers expected
to launch in the coming weeks.
- Due to the broad consumer reach of the family of companies
owned by HempFusion, the Company is able to appeal to roughly 80%
of the current population of CBD purchasers including women, Baby
Boomers and, the “Gellennial” crossover (Gen X and
Millennial).
- Six sales channels including its newly launched private label
division
- Revenue growth is anticipated to be driven heavily by our
robust investment into our DTC (Direct To Consumer) e-commerce
platform that has already shown early stage success.
- Global footprint across multiple countries including, but not
limited to, USA, Canada, Ireland, United Kingdom, Mexico, South
Korea, United Arab Emirates, and China with several more now in
final execution phase
- The #1 brand in CBD topicals, with 23% market share in the Drug
channel [Drug (IRI-SPINScan 52 week ending 7-11-2021)] and
13.8-per-cent market share in the multiple outlet channel [MULO
(IRI-SPINScan 52 week ending 7-11-2021)] and the #1 brand in a top
five largest FDM channel retailer [NielsenIQ product share report
from largest retail grocery chain in the Southeastern US (Nielsen
Consumer, LLC., pull week ending 5/22/21)].
- A diverse management team with cross divisional synergies and
incredible employees
- Substantial investment into regulatory compliance creating a
strong base for future FDA regulatory guidelines
- Exclusivity of the entire supply chain from soil to oil
- Strategic production relationships that enable the Company to
meet demand with little to no anticipated disruption in service as
operations scale
With the recent closing of the Acquisitions, HempFusion now has
significant distribution of market leading products into thousands
of retailers globally, as well as the ability to roll out highly
compliant, organic-certified ingestibles through multiple
e-commerce and retail platforms. Upon the anticipated approval of
ingestibles from major retailers, the Company expects to rapidly
fill its newly expanded pipeline. Additionally, HempFusion plans to
leverage the investment it has made in international distribution
to bring a more robust offering to Europe and Asia, including
expanding its already strong partnership with T-Mall.
“I am pleased to present revenue guidance for 2021 and 2022 to
our investor community,” commented Dr. Jason Mitchell, the
Company’s Chief Executive Officer. “With the Acquisitions closed,
not only do we reach over 15,000 retail locations and sell products
in eight countries, but we’re also targeting up to $30 million in
revenue for 2022. Combining this with our regulatory preparedness
for ingestible CBD, we believe that we are poised to be the
outstanding leader in the CBD industry. With a current market
capitalization under $40 million, we hope this provides investors
with a strong sense of confidence in our Company and sets us apart
from our competitors,” continued Mr. Mitchell.
ABOUT HEMPFUSION
HempFusion is a leading health and wellness CBD company
utilizing the power of whole-food hemp nutrition. HempFusion
distributes its family of brands, including HempFusion, Probulin
Probiotics, Biome Research, and HF Labs, to approximately 4,000
retail locations across all 50 states of the United States and
select international locations. Built on a foundation of regulatory
compliance and human safety, HempFusion’s diverse product portfolio
comprises 48 SKUs including tinctures, proprietary FDA Drug Listed
Over-The-Counter (OTC) Topicals, Doctor/Practitioner Lines and
more. With a strong focus on research and development, HempFusion
has an additional 30 products under development. HempFusion is a
board member of the US Hemp Roundtable, and HempFusion’s
wholly-owned subsidiary, Probulin Probiotics, is one of the
fastest-growing probiotics companies in the United States,
according to SPINs reported data. HempFusion’s CBD products are
based on a proprietary Whole Food Hemp Complex™ and are available
in-store or by visiting HempFusion online at www.hempfusion.com or
www.probulin.com.
Follow HempFusion on Twitter, Facebook and Instagram and
Probulin on Twitter, Facebook and Instagram.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements and
forward-looking information within the meaning of Canadian
securities legislation (collectively, “forward-looking
statements“) that relate to HempFusion’s current expectations
and views of future events. Any statements that express, or involve
discussions as to, expectations, beliefs, plans, objectives,
assumptions or future events or performance (often, but not always,
through the use of words or phrases such as “will likely result”,
“are expected to”, “expects”, “will continue”, “is anticipated”,
“anticipates”, “believes”, “estimated”, “intends”, “plans”,
“forecast”, “projection”, “strategy”, “objective” and “outlook”)
are not historical facts and may be forward-looking statements and
may involve estimates, assumptions and uncertainties which could
cause actual results or outcomes to differ materially from those
expressed in such forward-looking statements. No assurance can be
given that these expectations will prove to be correct and such
forward-looking statements included in this news release should not
be unduly relied upon. These statements speak only as of the date
of this news release. In particular and without limitation, this
news release contains forward-looking statements relating to the
Company’s anticipated distribution, product, geographic and sales
expansion plans, DTC revenue growth, expansion of the Company’s
global footprint, production relationships and related anticipated
lack of service disruptions as operations scale, plans to provide a
more robust offering to Europe and Asia, expansion of its
relationship with T-Mall and the Company’s other plans, focus and
objectives.
Forward-looking statements are based on a number of assumptions
and are subject to a number of risks and uncertainties, many of
which are beyond HempFusion’s control, which could cause actual
results and events to differ materially from those that are
disclosed in or implied by such forward-looking statements. Such
risks and uncertainties include, but are not limited to, the impact
and progression of the COVID-19 pandemic and other factors set
forth under “Cautionary Note Regarding Forward-Looking Statements”
and “Risk Factors” in the annual information form of the Company
dated March 31, 2021, and available under the Company’s profile on
SEDAR at www.sedar.com. HempFusion undertakes no obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
may be required by law. New factors emerge from time to time, and
it is not possible for HempFusion to predict all of them or assess
the impact of each such factor or the extent to which any factor,
or combination of factors, may cause results to differ materially
from those contained in any forward-looking statement. Any
forward-looking statements contained in this news release are
expressly qualified in their entirety by this cautionary
statement.
Future-Oriented Financial Information and Assumptions
This news release also contains future-oriented financial
information and financial outlook information (collectively,
“FOFI”) regarding the Company’s prospective revenue, which is
subject to the same assumptions, risk factors, limitations and
qualifications as set forth above. In addition, the Company’s
management used numerous other assumptions to derive these
financial projections. Certain key assumptions that underpin the
Company’s revenue guidance are as follows; the Company will
continue as a going concern and raise additional financing to fund
its planned expansion plans; there will be no United States
lockdowns or stay-at-home order issued due to a resurgence of
COVID-19 pandemic for the remainder of 2021 and the entirety of
2022; none of the Company’s principal manufacturers will incur
significant unplanned downtime; the Company will continue to expand
its retail footprint to over 2,000 locations in fiscal 2021 on
HempFusion and Probulin brands; the Company will successfully
execute on its recently awarded and announced national grocery
chain private label contract for 10 SKUs; the Company will, in
fiscal 2021, successfully launch into the over-the-counter (OTC)
analgesic category with at least 4 SKUs and launch ingestible for
Sagely Naturals and Apothecanna (both of which have been topical
products only historically); the Company will experience continued
growth in direct-to-consumer (DTC) sales consistent with historic
growth rates for its HempFusion and Probulin brands and expanded
new growth on its Sagely and Apothecanna brands; e-commerce growth
with Amazon and Tmall will continue consistent with current growth
rates and factoring in the potential inclusion of CBD products; the
Company will successfully expand its global footprint with further
European Union expansions and new market expansion in Latin
America, Saudi Arabia, Kuwait and Canada; there will be FDA
regulatory clarity for expansion of ingestible into existing and
new customers; the Company will successfully execute new innovation
product launches, including annualized and structure function
gummies, across all four brands; and the Company will continue its
distribution expansion through all six sales channels, including
its newly launched private label division. Other assumptions used
by the Company’s management to derive these financial projections
include, among other things: that the demand for the Company’s
products will continue to significantly grow; that the past
production capacity of the Company’s third party manufacturing
facilities can be maintained or increased; that the Company will
receive all necessary regulatory approvals for the production and
sale of its news products; that there will be increased production
capacity through implementation of new manufacturing facilities and
new technology; that there will be an increase in number of
products available for sale to retailers and consumers; that there
will be an expansion in geographical areas by national retailers
carrying the Company’s products; that there will be an expansion
into new national and regional grocery retailers; that there will
be an expansion into new e-commerce, home delivery, convenience,
and healthy food channels; that there will not be interruptions on
production of the Company’s products; that there will not be a
recall of products due to unintended contamination or other adverse
events relating to the Company’s products; that the Company will be
able to obtain additional capital to meet the Company’s growing
demand and satisfy the capital expenditure requirements needed to
increase production and support sales activity; the Company will
maintain its ability to successfully develop its products; the
Company’s pricing targets will remain in place; the Company will
maintain its ability to successfully deploy its products to
retailers; the Company will be able to maintain performance and
quality as projects advance and product volume increases; and the
effect of the ongoing global COVID-19 public health emergency on
the Company's operations, its employees and other stakeholders,
including on customer demand, supply chain, and delivery schedule,
will be mitigated for the remainder of fiscal 2021 and entirety of
fiscal 2022.
FOFI was made as of the date of this news release and is
provided for the purpose of describing anticipated sources, amounts
and timing of revenue generation as it relates to this retailer,
and is not an estimate of profitability or any other measure of
financial performance. In particular, revenue estimates do not take
into account the cost of such estimated revenue, including the cost
of goods and the cost of sales. In addition, and for greater
certainty, revenue estimates do not take into account the operating
costs of the Company. The Company disclaims any intention or
obligation to update or revise any FOFI contained in this news
release, whether as a result of new information, future events or
otherwise, unless required pursuant to applicable law. FOFI
contained in this news release should not be used for purposes
other than for which it is disclosed herein.
Neither the TSX nor its Regulation Services Provider (as that
term is defined in the policies of the TSX) accepts responsibility
for the adequacy or accuracy of this release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210825005271/en/
Jason Mitchell, N.D. Chief Executive Officer and Director Email:
ir@hempfusion.com Phone: 416-803-5638
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