Charlotte’s Web Holdings, Inc. (CSE:CWEB) (OTCQX:CWBHF) reported financial results for the first quarter ended March 31, 2019 with revenue growing 66% to $21.7 million. The net income dropped to $2.3 million from last year’s $3.1 million. The company delivered earnings per share that fell to $0.03 and diluted EPS of $0.02 versus last year’s $0.04.
Operating expenses doubled from last year’s $6.4 million to this year’s $13.2 million.
Just a couple of weeks ago the company named Deanie Elsner as the new Chief Executive Officer. Elsner is from Kellogg’s where she was President of the $3B dollar U.S. Snacks division – the largest business unit in the Kellogg Global portfolio and prior to that served more than 20 years in various leadership roles at the Kraft Foods Company including Chief Marketing Officer.
“Charlotte’s Web has established itself as the market leader in sales, and more importantly as a trusted brand with an impeccable reputation,” said Ms. Elsner. “As someone with an extensive career in the CPG industry-leading global brands, I see a tremendous opportunity to further influence, shape and grow the CBD category while turning Charlotte’s Web into a household product name that consumers can rely on around the world. My priority is to raise the Company’s level of operational effectiveness and accelerate growth opportunities acting with urgency and decisiveness.”
Following the end of the quarter, shipments began to a fourth national retailer and the company has over 6,000 retail locations now receiving shipments of its leading hemp CBD products. The company said that more than 2,300 new retail doors were added since the start of the year – more than all of 2018 – significantly expanding the company’s physical brick and mortar retail reach.
As of May 28, 2019, Charlotte’s Web reported that it is shipping product to four national retailer locations covering 18 states combined. The company said it expects additional states and stores to be added by these retailers throughout 2019. A major grocery retailer is also carrying all categories of Charlotte’s Web product portfolio including oils, capsules and topicals, while the remaining national retailers have begun their Charlotte’s Web product introduction with topical products only.
“We are forecasting revenue to grow at a faster pace than operating expenses, particularly in the back half of the year,” stated Rich Mohr, Chief Financial Officer of Charlotte’s Web. “This supports our adjusted EBITDA guidance in the 30%-35% range on an annualized basis, in line with our historical norms. Our sales volumes continue to increase on a quarterly basis and we’re expecting continued top-line growth during the second quarter and during the last half of the year. We reiterate our revenue guidance for 2019 of between $120 million and $170 million.”