CHARLOTTE, N.C.--(BUSINESS WIRE)--cbdMD, Inc. (NYSE American: YCBD), reported today that in its fiscal quarter ended March 31, 2019, it generated total net sales of $5.7 million, up 84% over prior year results and sales for cbdMD products have grown 55% sequentially from the December 2018 quarter to March 2019 quarter.
- Total net sales on a GAAP basis increased 84% to $5.7 million for the second quarter ended March 31, 2019 compared to the prior year period.
- Gross profit as a percentage of net sales was 62.4% for the second quarter ended March 31, 2019, up from 60.6% in the quarter ended December 31, 2018.
- Working capital of $12.3 million at March 31, 2019, compared to working capital of $10.8 million at September 30, 2018. In addition, completed a secondary financing with net proceeds of approximately $12.6 million that closed on May 15, 2019.
- Ecommerce sales platform generated over 70% of net sales.
- 97%, or $30.9 million of the quarterly net loss of $31.8 million for the quarter ended March 31, 2019, attributed to the change in the value of the contingent liability related to acquisition of the cbdMD brand. The change in value was primarily related to the increase in the company’s stock price.
“Our goal is to build cbdMD into the most recognized cbd brand in the America. Our strong second quarter results place us in a great position to accomplish this goal. Our March quarter results put us on pace to meet or exceed the established revenue earn-out targets for the first year of operations for cbdMD, which was $20 million for 2019. In fact, our March quarter was 78% ahead of those earn-out projections. Furthermore, we are currently trending a full year ahead of the revenue earn-out projections, although there is no assurance that this trend will continue. Our Ecommerce sales platform remains strong and has accounted for over 70% of our total net sales. We are starting to track more direct retail sales through a growing list of wholesalers and retail outlets. On a store count basis, we have grown from under 600 doors in December 2018 to over 2,000 currently, and we continue to build momentum,” stated Martin A. Sumichrast, Chairman and CEO of cbdMD, Inc.
“Our strong financial position has enabled us to strengthen and grow valuable partnerships and sponsorships with world-class athletes that resonate with our customers,” continued Mr. Sumichrast. “One of those athletes, former UFC Light Heavyweight Champion, Quinton "Rampage" Jackson, joined cbdMD president Caryn Dunayer and me on the NYSE trading floor on May 1st for our official launch under our new ticker, YCBD. Also joining us was 2 Time Masters Champion and 12-time PGA Tour winner Bubba Watson, who has joined our all-star roster of partner athletes. We are excited to watch Bubba tee off today at the PGA Championship with cbdMD as his sponsor and wish him the best of luck. We are excited to be the first CBD company to partner with a PGA major champion.”
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About cbdMD, Inc.
cbdMD, Inc. (NYSE American: YCBD) owns and operates the nationally recognized consumer cannabidiol (CBD) brand cbdMD whose current products include CBD tinctures, CBD gummies, CBD topical, CBD bath bombs, CBD oils, and CBD pet products. The company also operates licensing and corporate brand management businesses as well as the products division.
This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements can be identified by the use of words such as ''should,'' ''may,'' ''intends,'' ''anticipates,'' ''believes,'' ''estimates,'' ''projects,'' ''forecasts,'' ''expects,'' ''plans,'' and ''proposes.'' These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including, without limitation, statements made with respect to the expansion of the consumer market for CBD products and our ability to increase our market share, , our limited operating history, our ability to expand our business and significantly increase our revenues and meet earnout projections, and our ability to report profitable operations in the future. You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading "Risk Factors" in cbdMD, Inc.'s Annual Report on Form 10-K for the fiscal year ended September 30, 2018 as filed with the Securities and Exchange Commission (the "SEC") on December 12, 2018, our Quarterly Report on Form 10-Q for the period ended March 31, 2019 as filed with the SEC on May 15, 2019 and our other filings with the SEC. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, many of which are generally outside the control of cbdMD, Inc. and are difficult to predict. cbdMD, Inc. does not undertake any duty to update any forward-looking statements except as may be required by law.