Action plan to deliver over $10 million USD ($12.5
million CAD) in annual savings
Management to immediately focus on
increasing value of core operations: Sprout Foods, Biodroga, &
cannabis
Management expects positive cannabis
contribution in Q2'23, accelerating original timeline due to strong
sales growth to-date
Management to provide more detail during
the Company's Fiscal Second Quarter 2021 Financial Results
Conference Call on November
15
LAVAL, QC, Nov. 15, 2021
/CNW/ - Neptune Wellness Solutions Inc. ("Neptune"
or the "Company") (NASDAQ: NEPT) (TSX: NEPT), a diversified and
fully integrated health and wellness company focused on
plant-based, sustainable and purpose-driven lifestyle brands, today
announced that, following the Company's establishment of a
Strategic Review Committee in August of calendar year 2021, the
Board of Directors has approved a comprehensive action plan
presented by Neptune's management team to unlock shareholder
value.
The action plan includes short-term and long-term cost-cutting
initiatives and the immediate reorganization of Neptune's
operations and resources, which are estimated to generate annual
cost savings of over $10 million USD
($12.5 million CAD) and streamline
operations. Following approval by the Board of Directors,
management today implemented and executed the following
actions:
- Resource prioritization on three core product lines and
operations:
-
- Sprout® Foods
- Cannabis
- Biodroga
- Elimination of non-core operations.
- Immediate reduction in personnel by approximately 10% to
streamline operations, including the role of Chief Operating
Officer.
- Temporary freeze on non-essential hiring.
- Continued commitment to building a culture of improved
transparency and accountability.
"Following the Board approval of our proposed action plan, we
immediately began implementing key initiatives with a renewed focus
on our most promising brands, streamlining Neptune's management
structure and eliminating non-core operations," stated Michael Cammarata, President and Chief Executive
Officer of Neptune Wellness. "We are really proud of the progress
we've seen in the rollout of our cannabis brands, Mood Ring and
PanHash, as well as the growth of Biodroga, which is underpinned by
our patented MaxSimil technology. For Sprout, we continue to
increase our retail footprint and anticipate a successful
CoComelon™ product launch by the end of the year. We intend to
prioritize the continued success of these brands, and, in addition,
we are focused on streamlining Sprout's operations and improving
supply chain efficiency. We believe that our action plan will lead
to immediate and recurring cost savings, as well as allow us to
focus on our product lines and brands with high margin growth
potential. Management will continue to evaluate Neptune's strategic
position and operational priorities on an ongoing basis to ensure
it maximizes shareholder value."
Interim CFO Randy Weaver added,
"We expect each of the prioritized brands and product lines to
contribute positively to Neptune's results with limited additional
investment. For our cannabis vertical, in particular, we took a
hard look at the right strategic direction for the company. Over
the last year, our cannabis business in Canada has achieved improved efficiencies and
steadily increased its revenue since changing to branded products.
We now expect that our cannabis business, with limited additional
capital investments, will begin making positive contributions
during the second quarter of fiscal year 2023 and will be an
important part of our larger growth strategy. Additionally, we
continue to actively evaluate potential acquisition candidates
across each of our verticals that fit with our strategic vision and
tactical objectives, while positively contributing to our
short-term performance. As always, we remain open to strategic
partnerships which allow us to increase shareholder value."
Management will provide more detail on the plan during the
Company's Fiscal Second Quarter 2021 Financial Results Conference
Call scheduled for today at 5:00 PM
EST. The call will be webcast and can be accessed at
www.investors.neptunewellness.com. To listen to the live call,
please go to the website at least 15 minutes early to register,
download and install any necessary audio software. The webcast will
be archived for approximately 90 days.
About Neptune Wellness Solutions Inc.
Headquartered
in Laval, Quebec, Neptune is a
diversified health and wellness company with a mission to redefine
health and wellness. Neptune is focused on building a portfolio of
high quality, affordable consumer products in response to long-term
secular trends and market demand for natural, plant-based,
sustainable and purpose-driven lifestyle brands. The Company
utilizes a highly flexible, cost-efficient manufacturing and supply
chain infrastructure that can be scaled to quickly adapt to
consumer demand and bring new products to market through its mass
retail partners and e-commerce channels. For additional
information, please visit: https://neptunewellness.com/.
Disclaimer – Safe Harbor Forward–Looking Statements
Forward-looking statements contained in this press release
involve known and unknown risks, uncertainties and other factors
that may cause actual results, performance and achievements of
Neptune Wellness This news release contains "forward-looking
information" and "forward-looking statements" (collectively,
"forward-looking statements") within the meaning of applicable
securities laws. All statements, other than statements of
historical fact, are forward-looking statements and are based on
expectations, estimates, and projections as at the date of this
news release. Any statement that involves discussions with respect
to predictions, expectations, beliefs, plans, projections,
objectives, assumptions, future events or performance (often but
not always using phrases such as "expects", or "does not expect",
"is expected", "anticipates" or "does not anticipate", "plans",
"budget", "scheduled", "forecasts", "estimates", "believes" or
"intends" or variations of such words and phrases or stating that
certain actions, events or results "may" or "could", "would",
"might" or "will" be taken to occur or be achieved) are not
statements of historical fact and may be forward-looking
statements. In this news release, forward-looking statements
include, among other things, statements with respect to the
Company's strategic review, expected cost savings, expected
profitable growth, the success of the Company's action plan,
future increased revenues, expectations regarding expenses,
cash needs, cash flow, liquidity and sources of funding,
future expansion plans, initiatives and strategies of the Company,
and the Company's performance, growth initiatives, profitability,
future product launches and plans and gain in market share.
These forward-looking statements are based on assumptions and
estimates of management of the Company at the time such statements
were made. Actual future results may differ materially as
forward-looking statements involve known and unknown risks,
uncertainties, and other factors which may cause the actual
results, performance, or achievements of the Company to materially
differ from any future results, performance, or achievements
expressed or implied by such forward-looking statements. Such
factors, among other things, include: the ability of the Company to
successfully implement its strategic initiative; implications of
the COVID-19 pandemic on the Company's operations; fluctuations in
general macroeconomic conditions; fluctuations in securities
markets; expectations regarding the size of the cannabis markets
where the Company operates; changing consumer habits; the ability
of the Company to successfully achieve its business objectives and
cost cutting plans; plans for expansion; political and social
uncertainties; inability to obtain adequate insurance to cover
risks and hazards; the ability of the Company to obtain financing
on acceptable terms, the adequacy of our capital resources and
liquidity, including but not limited to, availability of sufficient
cash flow to execute our business plan (either within the expected
timeframe or at all); the ability of the Company to obtain
financing on acceptable terms, expectations regarding the
resolution of litigation and other legal and regulatory
proceedings, reviews and investigations; employee relations; and
the presence of laws and regulations that may impose restrictions
in the markets where the Company operates. Although the
forward-looking statements contained in this news release are based
upon what management of the Company believes, or believed at the
time, to be reasonable assumptions, the Company cannot assure
shareholders that actual results will be consistent with such
forward-looking statements, as there may be other factors that
cause results not to be as anticipated, estimated or intended.
Readers should not place undue reliance on the forward-looking
statements and information contained in this news release. The
Company assumes no obligation to update the forward-looking
statements of beliefs, opinions, projections, or other factors,
should they change, except as required by law.
Additional information regarding these and other risks and
uncertainties relating to the Company's business are contained
under the heading "Risk Factors" in the Company's Annual
Information Form, and under the heading "Risk Disclosure" in the
Company's Management's Discussion and Analysis dated July 15, 2021, for the year ended March 31, 2021, and the Company's quarterly
Management's Discussion and Analysis, filed under the Company's
profile on SEDAR at www.sedar.com.
Neither NASDAQ nor the Toronto Stock Exchange accepts
responsibility for the adequacy or accuracy of this
release.
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SOURCE Neptune Wellness Solutions Inc.