Charlotte's Web Archives - Green Market Report

Debra BorchardtDebra BorchardtJune 12, 2020
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6min92635

The Stanley Brothers in Colorado made their name by targeting a strain called Charlotte’s Web that had greater amounts of CBD than THC in order to treat a young girl with a rare form of epilepsy. The girl, Charlotte Figi, suffered from Dravet Syndrome that caused her to have multiple seizures in a single day. This strain of cannabis seemed to quell the seizures and allowed her to live a better life. Sadly, Figi recently passed away.

The company called the strain Charlotte’s Web in her honor and even changed its name to Charlotte’s Web Holding Inc. (OTC:CWBHF). Then the company attempted to trademark the name Charlotte’s Web, but was rejected. In October 2019, the United States Patent & Trademark Office rejected the trademark application for “Charlotte’s Web” in a nonfinal Office Action.  The USPTO specifically found that the name “Charlotte’s Web identifies a particular strain of low THC, high CBD content Cannabis sativa plants” does not function as a trademark.

CBD company AAXLL contends that anyone can use the name Charlotte’s Web since it isn’t trademarked. The company believes that CWI made “a serious mistake in adopting the generic name of a strain as its corporate and brand name since everyone has the right to use the name of a strain.”

The logic here is that no company can trademark a specific strain of cannabis. No one company can own the Jack Herer or Purple Kush or Girl Scout Cookies. However, master growers often apply for patents on strains they create as intellectual property. GW Pharmaceuticals (GWPH) has numerous patent applications for various cannabis drug combinations. Since the federal government is loathe to trademark anything related to marijuana, states stepped in to protect various brand names.

AAXALL Fights Back

AAXLL disputes CWI’s central allegation that Charlotte’s Web is not the name of a strain of hemp.  AAXLL CEO Joseph Maskell notes that CWI itself referred to “the Charlotte’s Web strain” in its own 2019 public offering documents.

Maskell also states, “U.S. federal trademark law already dictates that cultivar or strain names are generic from the get-go, so the Charlotte’s Web name of the strain was never protected as a trademark. CWI cannot prevent the rest of the world from referring to Charlotte’s Web as a strain of hemp any more than a French winery could prevent the world from referring to Chardonnay as a varietal name of grapes.”

AAXLL’s Maskell comments that USPTO’s rejection of CWI’s trademark application would demonstrate Maskell concludes, “the family-run Balance CBD brand will not be bullied by CWI.  It’s shameful that a large publicly traded corporation uses such tactics to intimidate competition to try to cover up their past mistakes”

Charlotte’s Web Fights To Protect Name

Like any large company, Charlotte’s Web is fighting to protect its name. In a company filing it wrote, “CW currently has a portfolio of pending U.S. plant, utility and design patent applications directed to CW’s most promising plant genetics, proprietary extraction technology, cannabinoid isolation methods and cannabinoid conversion processes and industrial designs. CW also has pending U.S. and Canadian trademark applications.”

While AAXALL points to the government trademark rejection as a reason it should get to use the name, Charlotte’s Web says that the rejection was due to the product falling under the Controlled Substances Act and FD & C Act. Not because of a strain argument. It said it, “May rely on common law theories of trademark protection and enforcement in cases of actual or suspected trademark infringement of the trademarks it wishes to protect.” The company also noted that such battles to protect its name and trade secrets could be expensive.

Litigation Lineup

Any large company is always seen as a litigation target. There is the assumption that a big company has the money to settle a case rather than fight. Charlotte’s Web market share in the CBD industry is the largest and has at times been as much as a third, although competition has caused that number to decline.

The company faces a class-action lawsuit that its CBD products contain more hemp than the label says. The company contends the products are accurately labeled. Another lawsuit is being fought with AgriMed, who had the license to sell CW products in the state of Illinois. AgriMed says CW competed against it by selling CW products in the state as well. CW says that AriMed didn’t pay the royalties it said it would. That trial had been planned for May 2020.

 


Debra BorchardtDebra BorchardtMay 14, 2020
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5min4120

Charlotte’s Web Holdings, Inc. (OTCQX:CWBHF) reported slipping first-quarter revenue for the period ending March 31, 2020. Charlotte’s Web delivered revenue of $21.5 million, slightly below last year’s revenue of $21.7 million for the same time period in 2019. However, this beat the Yahoo! Finance average analyst estimate of $20.78 million.

The earnings per share were reported at a negative $0.11 per share. This missed the analyst estimate for a negative $0.06 per share. The company attributed the drop to lower business-to-business (B2B) sales, but also noted that direct-to-consumer (DTC) sales increased.

The company also reported a net loss of $11.5 million versus last year’s net income of $2.3 million for the same time period. Charlotte’s Web also said that the adjusted EBITDA for the quarter was a negative $5.7 million or -26.5% of consolidated revenue compared to positive EBITDA of $4.5 million and 20.7% of consolidated revenue for the first quarter of 2019. The company said this reflected the substantial investments to support expected future revenue growth from the F/D/M channel.

“First quarter revenue was ahead of expectations driven by our strong DTC e-commerce sales enabled by our new technical platform and capabilities.  Operationally we have not had any business disruptions from COVID-19 and have adapted well to the remote working environment,” said Deanie Elsner , CEO of Charlotte’s Web.  “Strategically we implemented several strategies during the quarter to address the F/D/M channel, with new topical products, new pricing, and the announcement of our intent to acquire Abacus Health. We also launched CW Labs to drive break-through Innovation and to support the need for more science and data. These moves have been well received by our customers across all channels and we continue to execute on our plan for 2020.”

Too Much Competition

Despite owning a third of the CBD market, increased competition weighed on Charlotte’s Web. The company said that B2B sales were 31.5% lower year-over-year as the natural retail channel struggled with overcrowding due to increased competition. The company also stated that a lack of FDA regulatory guidelines for the F/D/M channel held back the adoption of ingestible products.

Customers though managed to find the Charlotte’s Web products online as DTC net sales grew by 29.4% through ongoing marketing and social media programs. The company said that year-over-year new consumer acquisitions increased 25% and conversion rates increased 77%. DTC net revenue accounted for 65.6% of total revenue in the first quarter compared to 50.2% for the same period in the prior year.

Cash Burn

The company used $14.9 million of cash in operations during the quarter versus the $3.7 million of cash that was used in the first quarter of 2019. The company said this was due to the construction of its new 137,000 sq. ft. production and fulfillment center to support anticipated growth. Still, the company is in great shape as its cash and working capital at the end of the quarter stood at $53 million and $114.9 million, respectively.

Looking Ahead

“We are modeling for revenue growth of 10% to 20% in 2020 and a return to positive adjusted EBITDA by the end of the year,” explained Russ Hammer, Chief Financial Officer of Charlotte’s Web. “As our new facilities come online later in the year, we expect to harness cost savings through our vertically integrated supply chain to support meaningful increases in adjusted EBITDA, and then continue to leverage against higher revenue as we enter 2021 and 2022.”

Canaccord Genuity analyst Derek Dley wrote in a research note dated May 13, 2020, “The company’s CPG focused management team is well-positioned to lead the company into newer markets as the FDA allows the FDM channels to sell ingestible products over time, in our view.”


StaffStaffMay 13, 2020
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9min18220

Ever since recreational cannabis has stolen the stage, people tend to forget that cannabis is one of the oldest and most trusted medicines on the planet.

The medicinal properties within the plant are responsible for managing the symptoms associated in patients suffering from Epilepsy, Autism, Crohn’s Disease, Cancer, PTSD, and Chronic Pain to name just a few.

These brands have developed some of the best practices and formulations in the industry to treat a myriad of ailments with patents pending across the globe.

Our team decided to break down a list of the most respected medical brands and products within the cannabis industry globally.

Here they are:

 

1.) Charlotte’s Web:

More than just CBD: CBD plus naturally-occurring phytocannabinoids, terpenes, flavonoids and more in every CBD oil serving. The team from Charlotte’s Web uses limited, select ingredients to ensure you have the absolute best hemp extract possible. Their CBD oils include Charlotte’s Web premium hemp extract, carrier oil, and flavor. That’s it. Their products are U.S. Hemp Authority Certified. Charlotte’s Web CBD oils are whole-plant extracts that include a variety of of beneficial compounds, including phytocannabinoids, terpenes, flavonoids, and essential fatty acids.

 

2.) Aunt Zelda’s:

Aunt Zelda’s is a pioneering, data-driven developer of cannabis-based plant medicines. Our products are the result of years of research and development by founders, Mara Gordon and Stewart Smith, in consultation with knowledgeable physicians and world-renowned researchers.

Utilizing proven time-tested extraction processes improved with modern technology, Aunt Zelda’s offers medicines of precisely measured potency and purity that empower patients to dose to the milligram and unlock the therapeutic potential of cannabis.

If you prefer to obtain lab tested products created for specific ailments, Aunt Zelda’s will help you get there!

Aunt Zelda’s mission is to alleviate patient suffering through medical cannabis.  We help you, our patients, live fulfilling, healthy lives.

They provide unmatched expertise in the correct use of medical cannabis matched to disease-specific products with the highest purity in California.

Their goal is to create a positive and supportive community for medical cannabis users. They aspire to be your trusted source of cannabis resources and its safe, effective and responsible use

 

3.) HOPE Grows for Autism:

Formulation by: Zelira Therapeutics

HOPE is a Proprietary formulation specifically to address patient symptoms associated with Autism Spectrum Disorder.  The HOPE® Franchise has received support from organizations such as HOPE Grows for Autism, a leading autism advocacy group based in Pennsylvania. It has been the top performing product within the state and will soon be available for patients in Louisiana and throughout the US and Australia. 

In a company press release in December 2019, Zelira Therapeutics leadership said, “Our company will have the ability to distribute the HOPE® portfolio along with our additional products through licensing agreements with multi-state and international operators…”

HOPE 1 and HOPE 2 are part of a growing family of proprietary medical marijuana formulations. HOPE™ is created by extracting, isolating, and then re-assembling the medicinal compounds from the marijuana plant to achieve specific, targeted effects. HOPE™ was formulated with autism in mind and has quickly proved to be beneficial to other chronic conditions such as chronic pain, anxiety, neuropathy and others. HOPE™ has since become its manufacturer’s best-selling tincture.

 WHAT FORMS OF HOPE ARE AVAILABLE?

Available as a tincture, blended in 100% olive oil.

WHAT MAKES UP HOPE?

THC + CBD + Terpenes

Found in the trichomes of the plant, terpenes are plant oils with unique aromas and distinctive​ flavors (pine, citrus, mint) and are known to play​ a key role on the overall effects of each strain. ​ Terpenes also play a key role in differentiating​ the flavor and scent of marijuana. Some terpenes​ might promote relaxation, while others energy or​ focus.

 

4.) Ilera Holistic Healthcare:

ALAFIA — which means ‘inner peace’ in the Nigerian “Yoruba” language — is scientifically formulated, lab tested and pesticide free. Currently on the market are two formulated PURE CBD tinctures: Isolate CBD with 500mg and 1000mg  and Full Spectrum CBD with 500mg and 1000mg.  This product is Additional CBD products will be released at dispensaries in the state of Louisiana only.

“Our vision has always been patient access and affordability,” said Chanda Macias, chief executive officer of Ilera Holistic Healthcare. “It was imperative for us to bring high-quality products that support health and wellness.  Patients now have the ability to purchase ALAFIA over the counter without a prescription anywhere it is available.”  Dr. Chanda Macias said back in January 2020

5.) Haleigh’s Hope:

Extra strength has double the concentration than the regular strength, allowing the consumer to take less oil but still get the same desired therapeutic effect as the regular strength. Extra Strength products are recommended for people over 100 lbs.

This organically grown, whole plant extract contains a broad spectrum of naturally occurring plant based compounds that are clinically proven to provide a powerful combination of antioxidants and neuroprotectants. Haleigh’s Hope® was created from a proprietary genetic plant strain that was carefully bred and cultivated over seven years to achieve a precise combination of clinically proven, therapeutic plant compounds..

Haleigh’s Hope® grows, extracts, produces, packages and ships 100% of our product from our facilities in Colorado. Because we have exclusive control over our products from seed to sale, we ensure the highest levels of quality and consistency in the industry. Every batch of our product is lab tested for safety and quality.

Safflower is a cold pressed seed oil that is non-GMO and organic, and does not need to be shaken.

Exclusively grown and manufactured in Colorado, USA.


Julie AitchesonJulie AitchesonMay 12, 2020
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5min7960

It is not news that medical marijuana companies are constantly innovating to offer cannabis-derived products specifically formulated for those suffering from life-threatening and debilitating illnesses such as autism, cancer, and epilepsy. What doesn’t regularly make the headlines is the fact that many of them are creating and partnering with non-profit organizations in order to support providers and patients in turning that life-saving (or at least life-enhancing) corner. 

Hope Grows For Autisma nonprofit aimed at improving the lives of families affected by autism through research, education, and the advocacy of medical natural treatments was founded by Erica Daniels. Daniels is the mother of an autistic child, and her quest for a better quality of life for her son and family led her to discover the overwhelming significance of diet and medical cannabis in addressing her child’s autism. Her organization’s mission inspired a partnership between Hope Grows For Autism and medical marijuana company Zelira Therapeutics (formerly Zelda Therapeutics, which merged with Ilera Healthcare to form Zelira) in the creation of their HOPE™ range of products, which are formulated specifically for autism spectrum disorders. These products are olive oil-based tinctures that include Hope 1, which has a 1 to 1 THC:CBD ratio, and Hope 2, with a THC:CBD ratio of 5 to 1.  These formulas were created with the specific challenges of autism in mind, and have become bestselling items for Zelira.

Then there is The Flowering HOPE Foundation, a non-profit started by Jason Cranford, founder of medical marijuana company Haleigh’s Hope. The Flowering HOPE Foundation facilitates safe, lawful access to medical marijuana for individuals suffering from multiple ailments including Crohn’s, cancer, and epilepsy. Flowering HOPE also participates in petitioning and lobbying for clearer regulatory guidelines around marijuana access and use, such as this case profiled by PR Newswire involving a challenge of the DEA’s classification of hemp oil and CBD products as Schedule 1 substances. 

No profile of medical marijuana companies flexing philanthropic muscle on behalf of those in need would be complete without a mention of Colorado flagship company, Charlotte’s Web. Charlotte’s Web enjoys an active partnership with the Realm of Caring Foundation, a non-profit that provides education for patients and healthcare providers, research, and support to families in need of access to medical marijuana. The organization seeks to build a supportive community among those benefiting from the use of medical marijuana in their healing protocols and providing the latest research to inform decisions about treatment. 

This community-building aspect, which all of the aforementioned non-profits share, is particularly valuable to families who do not find the support they need for their medical marijuana treatment protocols from health insurance companies and the larger medical community.  As the science of crafting highly targeted formulas for some of today’s most challenging medical conditions becomes ever more refined, it is both evident and encouraging that some of the industry’s leading medical marijuana companies remain committed to serving the people behind the profits.

 


Debra BorchardtDebra BorchardtApril 8, 2020
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5min46091

Charlotte Figi came to fame as the sweet little girl who suffered hundreds of seizures a day from a rare condition called Dravet Syndrome. She was the patient that inspired the Colorado-based Stanley Brothers to create the cannabidiol (CBD) heavy version of cannabis to treat her condition back in 2011. The response was somewhat miraculous.

Unfortunately, Charlotte has passed away from COVID 19 at the age of 13. According to reports, she had tested positive and went to the hospital. She was released on Sunday, but apparently took a turn for the worse and returned. A family friend posted on Facebook “Charlotte is no longer suffering. She is seizure-free forever.” The family has requested privacy.

Charlotte’s parents were willing to take chances with cannabis as a treatment and their bravery resulted in the migration of many families to Colorado seeking the same treatment. She was featured in the now-famous CNN episode where she was treated on camera and millions were able to see with their own eyes the response CBD had on epileptic patients. She was six years old at the time and had been suffering from seizures since the age of three.

Colorado legalized medical marijuana and then adult-use marijuana causing the state to become the home of many cannabis companies. Stanley Brothers eventually changed the name of their company to Charlotte’s Web (OTC:CWBHF), the strain that was named after Charlotte. The company has ultimately captured 20% of the CBD market and is now a publicly-traded company with a market cap of $452 million. The company’s website posted the following message:

Charlotte was ten feet tall and carried the world on her shoulders.

Inspiring is a lacking word, as are courageous and vivacious and strong and beautiful.

She was divine.

She grew, cultivated by a community, protected by love, demanding that the world witness her suffering so that they might find a solution. She rose every day, awakening others with her courage, and with that smile that infected your spirit at the cellular level.

The infinite compassion of community members who sacrificed their time, resources, and ideas to tend her garden of love were instrumental in her care, but there was no one more committed than the selfless Paige, both a mother and a warrior, both a human and an angel. Charlotte’s cause was her family’s cause and created a foundation of plant-based health that breathed life into their daughter, and the countless sons and daughters like her.

Charlotte, then, became everyone’s daughter or sister or friend and enlivened empathy and love from anyone who had the privilege of hearing her story, as millions did. Her story built communities, her need built hope, and her legacy will continue to build harmony. 

To Paige, Matt, Greg, Max, and Chase – we are humbled by your grace, as the fruits of your kindness have fed the world with love.

She was a light that lit the world. She was a little girl who carried us all on her small shoulders.

Her legacy lives in the garden, in the blooming of ideas, in the fragrance of compassion, in the greenery of nurturing us to be better humans in all ways, always.

What began as her story, became the shared story of hundreds of thousands, and the inspiration of many millions more in the journey of their betterment. Charlotte was and will be, the heartbeat of our passion, and the conviction that the dignity and health of a human being is their right.

Charlotte, you are the light of our lives.

Thank you for your life, your bravery, and your beautiful soul.

We love you, Charlie.

-Joel, Jared, Jesse, Jon, Jordan, Josh, and Austin Stanley

 

 


Debra BorchardtDebra BorchardtNovember 13, 2019
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4min25410

Charlotte’s Web Holdings, Inc. (TSX: CWEB)(OTCQX: CWBHF)  reported that its revenue rose 41.8% to $25.1 million in the third quarter that ended September 30, 2019, versus $17.7 million for the same period in 2018. Still, the company delivered a net loss of $1.3 million versus last year’s net income of $1.8 million.

Rising Expenses

The operating expenses soared to $19.6 million over last year’s $9.8 million for the same time period. The company said in a statement that its “third-quarter operating expenses were $4.7 million”, but that isn’t the number that appeared in the financial table. The company did say that the rising expenses were “to support the Company’s growth and transition to a consumer-packaged goods operating company.

During the quarter Charlotte’s Web moved into larger office facilities in Boulder and added senior CPG management to the leadership team along with related personnel.  “Employee headcount was 307 on September 30, 2019, a 35.8% increase from 226 at September 30, 2018.”

“In an increasingly crowded, noisy and confusing CBD market, brands matter, and Charlotte’s Web is the most trusted hemp extract in the world,” said Deanie Elsner, Chief Executive Officer of Charlotte’s Web. “Consumer education is increasing and a 68% year-over-year increase in traffic through our online store drove Q3 B2C sales to new highs. As the CBD category’s flagship brand, we saw a similar 66% increase in sales pull into our B2B segment which includes the food/drug/mass (“FDM”) and natural health retail channels. This helped drive Q3 growth to 42% year-over-year.”

The revenue breakdown was as follows: Human consumables, topicals, and pet products grew by 43.6%, 156.7%, and 57.5%, respectively. On a year-over-year basis for the quarter ended September 30, 2019, B2C sales grew by 38.7% and accounted for 51.2% of total revenue in the quarter as online traffic increased 68% through expanded marketing and social media programs. B2B sales grew by 66.4% year-over-year and accounted for 48.8% of total revenue in the quarter as mass retailers including Kroger Co., Vitamin Shoppe and CVS Pharmacy locations entered the market in 2019.

Pets Performing

The company said that early sales traction for the new 12 SKU pet line from Charlotte’s Web has been encouraging with a 57% year-over-year increase in revenue with notable success in the independent retail channel.

Lowering Guidance

Ms. Elsner updated the Company’s revenue guidance: “We’re pleased with our growth of 42% for Q3 and 49.6% year-to-date. We expect full-year revenue for 2019 to be in the range of $95 to $100 million and to maintain growth rates for 2020 in the 40% to 50% range or until clear regulations are set.” In the last quarterly report, Rich Mohr, Chief Financial Officer said, “Our previously communicated revenue guidance for 2019 of between $120 million and $170 million remains in place.”

Elsner added, “We are prudently investing in the expansion of our production and distribution capacities as planned, ahead of anticipated FDA regulatory clarity that could enable wider adoption of our product portfolio. We remain hopeful that broad political support will help drive quick regulatory resolutions in 2020.”


William SumnerWilliam SumnerOctober 9, 2019
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3min10491

Charlotte’s Web Holdings, Inc. (TSX: CWEB) (OTCQX: CWBHF) announced today that it is partnering with the data and measurement firm Nielsen (NYSE: NSLN) to provide analytical coverage of the U.S. hemp-CBD retail market.

Recently, Nielsen has been dipping its toes into the hemp and cannabis space by entering into strategic partnerships with cannabis-focused data and analytics firms like Headset and by developing a suite of cannabis measurement capabilities

“We are thrilled to be entering a long-term partnership with Charlotte’s Web, a clear pioneer in the CBD industry,” said Susan Dunn, President, U.S. Sales at Nielsen. “Our mission is to work with the outstanding team at Charlotte’s Web to support and accelerate their growth by applying our breadth of data, insights, tools, and analytic assets.”

Charlotte’s Web has been aggressively moving to establish itself as a thought leader in the hemp industry. Recently the company became the first hemp brand to be granted a patent by the U.S. Patent and Trademark Office for a hemp plant.

The company hopes to leverage Nielsen’s data capabilities to gain insight into consumer attitudes, product preferences, use occasions, and to discern consumer’s future intent tied to consumer interaction points within CPG categories.

“This is a game changer for hemp CBD retail analytics,” said Deanie Elsner, CEO of Charlotte’s Web. “As the market leader in CBD, we have an obligation to advance objective data, purchase dynamics and insights that can be levered by our retailers in the Food, Drug and Mass channels. Nielsen is a trusted industry leader who was an obvious choice as our analytics partner. They provide unbeatable data and insights which will set the stage for one source of truth for the CBD Category.”

News of the partnership with Nielsen briefly gave the company’s stock a boost, rising from C$17.80 to C$18.44, but has since leveled off slightly and is currently trading at or around C$18.36 per share.


Debra BorchardtDebra BorchardtAugust 14, 2019
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7min21160

Charlotte’s Web Holdings, Inc. (TSX: CWEB)(OTCQX: CWBHF), a producer of whole-plant CBD hemp extract products, reported its financial results for the second quarter ending June 30, 2019. The company’s revenue grew 45% to $25 million over last year’s $17.2 million for the same time period. The net income fell to $2.2 million from last year’s $3.7 million.

Charlotte’s Web noted that 53% of its revenue came from retail outlets and that its gross margin was a whopping 75% producing gross profits of $18.8 million. Operating expenses doubled from $8.2 million last year in the second quarter to this year’s $16.2 million. The company attributed the increasing expenses to adding more personnel to address the company’s growth. Employee headcount increased by 41% over the past year.

“We have been experiencing increased sales through both our e-commerce and retail sales channels,” said Deanie Elsner, Charlotte’s Web Chief Executive Officer.  “Top tier mass retailers are entering the market as several national grocery and drugstore brands have announced their CBD plans. The majority of these are now carrying Charlotte’s Web products. This is a significant development for the hemp CBD category. To effectively service projected growth, we have been building our executive leadership with experienced consumer-packaged-goods (CPG) executives in sales, marketing, finance, data, and operations. Similarly, we are expanding our capabilities in cultivation, R&D, production, and distribution.” The company’ products are now available for sale in 8,000 locations.

In order to fund this expansion, Charlotte’s Web used $15.2 million of cash in operations during the first six months of 2019 compared to $6.1 million of cash provided from operations during the same period in 2018. The company said it reflects the investment in inventory required to supply increasing retail and consumer demand. Cash was also used for the 2019 hemp crop that was increased to 862 acres from 300 acres planted in 2018.

“We are experiencing increased momentum with large retailers as consumer awareness and interest in CBD grows,” said Deanie Elsner. “We believe we’ll continue to see additional large retailers coming onboard and expect an increase in the number of states and locations with our existing retail partners throughout the year. Kroger is the most recent example as they added four new states to their distribution in July, including Texas, which is the latest state to approve hemp CBD products.”

New Products

Charlotte’s Web introduced new products including new hemp extract infused CBD gummies in three flavors, and a new twelve SKU pet product line including functionally focused chews with synergistic ingredients to support specific health functions – Calming, Hips & Joints and Cognition. Subsequent to the second quarter, the Company signed two distribution partners for its pet line; Pacific Pet in California, one of the largest distributors of pet food and pet products on the west coast, servicing 1,000 independent pet stores in California, Arizona, Nevada, and Hawaii; and “Pet Food Experts”, servicing over 4,000 retailers in 33 states out of five distribution centers located in Rhode Island, Pennsylvania, Illinois, Washington, and Colorado.

Looking Ahead

“We forecast revenue growing at a faster pace than operating expenses in the back half of the year,” stated Rich Mohr, Chief Financial Officer of Charlotte’s Web. “This supports our financial forecast for increases in adjusted EBITDA percentages in future periods. As product volumes shipped continue to increase on a quarterly basis, we’re expecting continued top-line revenue growth during the last half of the year. Our previously communicated revenue guidance for 2019 of between $120 million and $170 million remains in place. Where we fall within this range will substantially be determined by future developments with the FDA, associated retailer response, and the timeline of these events.”  Russ Hammer has been named as the company’s new Chief Financial Officer.

 

 

 


Anne-Marie FischerAnne-Marie FischerJuly 31, 2019
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8min83360

According to Brightfield Group, the CBD market in the U.S. has grown over 700% in 2019.

The CBD industry is becoming much more saturated than it was before the passing of the U.S. Farm Bill late last year, with new products entering the market, threatening to take a slice of the CBD pie that the early producers of CBD have enjoyed until this time.

Nevertheless, the top 20 CBD companies still hold a majority of the even bigger pie that is CBD in the cannabis industry. 

Brightfield Group listed the Top 5 CBD Companies that the research group says “continue to make a name for themselves” within the growing CBD market. Here’s what we know about these various companies:

 

  • CW Hemp (Charlotte’s Web)

 

Earlier this summer, Charlotte’s Web Holdings (TSX:CWEB)(OTCQX:CWBHF) announced that their total acres of hemp planted for the 2019 growing season had increased 187% due to interest and demand for the products. Prior to that, the company reported its earnings for the first quarter with revenue growing 66% to $21.7 million. 

“Interest and demand for our products has been exceptional and growing rapidly. Our 2019 planting strategy ensures we will have the required raw materials to deliver on production targets for Charlotte’s Web products through 2020 and into 2021,” stated Deanie Elsner, CEO of Charlotte’s Web. “Our leading CBD hemp varieties under cultivation today are the foundation of our 2020 production plan.”

Brightfield Group remarked of the company: “By deeply understanding who they are as a brand and identifying the consumers that resonate with their messaging, they have built the foundation for potentially life-long customers and advocates.”

  1. PlusCBD Oil (CV Sciences)

PlusCBD Oil by CV Sciences (OTCMKTS: CVSI) has found success largely due to their low-dose capsule and softgel formats that Brightfield Group referred to as “a safe bet for more conservative users”. Green Market Report has been watching the steady increase in CV Science’s company value following last year’s impressive sales jump of 203% in the second quarter. 

The company is expected to announce its second-quarter results for 2019 on August 6. 

        3. Green Roads World

Green Roads offers unique, high-dose products, and have built their success on effective social strategies. With a growing employee base of over 100 the company had an estimated value of $45 million in 2018, according to co-founder Arby Boroso. 

The company sells CBD-infused products such as tinctures and balms, online and in 6,000 stores and 2,000 doctors’ offices across the country. Brightfield attributes their “values-based marketing” to their success and prominence in the CBD industry. 

  1. Medterra

Medterra’s growth is largely due to its effective SEO strategy and marketing. With a site that is full of engaging content that manages to get past the limitations of search engines, Medterra gets itself in front of the eyes of consumers.

The company recently announced a foray into the sports, fitness and golf communities, by partnering with Worldwide Golf Shops, the parent company to Edwin Watts, Roger Dunn, and some of the most well-known and established golf retail stores in the United States. 

  1. Irwin Naturals

Irwin Naturals turned heads when Klee Irwin, the founder of the company announced the company would be giving away $1M worth of CBD products to honor the passing of the Farm Bill. 

The company is concerned with making the cost of CBD products affordable, saying “Our mission is to spread health to the world through plant medicine. Our nation is on the edge. And I am worried about the future of our children. If we can make CBD affordable and accessible to the masses, it just might help our country avoid a meltdown.”

Groups of Competitors in the CBD Market

Brightfield Group laid out the different types of companies and brands that are continuing to lead the pack when it comes to innovative marketing, advanced products, and ways to stick out in the market. These companies are those who are:

  • CBD-only companies that have established brand loyalty, improved marketing strategies, and grow larger and more diverse customer bases
  • Cannabis companies including multi-state operators that leverage networks and infrastructure to build brand recognition and raise capital to expand CBD lines
  • Supplement brands existing in the natural food store and retail chain space
  • Disruptor brands that were little-known prior to this year and have risen up in the ranks as they’ve been picked up by large retail chains

As it is only still summer, it remains anyone’s game as to who will end up at the finish line in the CBD brand race by the end of the year.  


Debra BorchardtDebra BorchardtJune 19, 2019
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3min13120

Charlotte’s Web Holdings, Inc.  (TSX:CWEB)(OTCQX:CWBHF) reported its final hemp planting for its 2019 growing season. The company said that in order to meet growing demand the total acres planted for 2019 has been increased to 862, an 187% increase from 300 acres planted in 2018.

“Interest and demand for our products has been exceptional and growing rapidly. Our 2019 planting strategy ensures we will have the required raw materials to deliver on production targets for Charlotte’s Web products through 2020 and into 2021,” stated Deanie Elsner, CEO of Charlotte’s Web. “Our leading CBD hemp varieties under cultivation today are the foundation of our 2020 production plan.”

Charlotte’s Web said it uses an inventory model where it grows more hemp than it needs for the subsequent year to minimize the impact of farming risks and product shortfalls against forecasted rapid market growth. Dried hemp can be stored for years, with even more longevity in its extracted form. In 2016, 2017 and 2018, the company produced 41,000 lbs., 63,000 lbs. and 675,000 lbs., respectively, of dried hemp biomass.

A few weeks ago the company reported its earnings for the first quarter with revenue growing 66% to $21.7 million. The net income though 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.

Charlotte’s Web cultivates hemp outdoors in various regions across the United States to hedge against potential weather risks and other crop-related impacts. Of the 862 acres planted, 166 (19%) are in Colorado, 325 (38%) are in Kentucky, and 371 (43%) are in Oregon. The Colorado farms are operated by the company’s cultivation team while farms in Kentucky and Oregon employ family-owned contract farmers, supporting the important American agricultural economy through hemp farming.

All acres are cultivated using natural farming methods. An active supporter of organic farming, up to 457 acres, or 53% of the total acres planted for 2019 are designated for USDA organic certification, with additional organic expansion planned in subsequent years.

The company said it grows several hemp varieties, all of which contain high levels of CBD content but only trace THC amounts of less than 0.3%. Hemp varieties with high CBD potency reduce the amount of biomass required for CBD extracts, allowing for responsible farming practices by maximizing the production of cannabinoids, terpenes, and other beneficial botanical compounds.

 



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